Big in China; CNinsure reports awesome Q3 2016 earnings

CNinsure, an independent online-to-offline (“O2O”) financial services provider in China, announced its financial results for Q3, 2016. The unfiltered version, here. The digestible version, below.

Bird’s-eye view.

China’s insurance premiums increased 19.1% on a year-over-year basis, of which P&C and life insurance premiums were up 9.3% and 24.4%, respectively.

Bottom Line.

CNinsure insurance revenues grew by 66.3% compared to last year .

What gives?

CNinsure expanded their sales force; set up new branches and doubled the number of their sales agents.

Okay, but what else?

CNinsure integrated their P&C and life insurance agencies, which resulted in more cross-selling opportunities. In fact, the number of CNinsure agents who have sold both P&C and life insurance policies increased by 38% from the same period last year.

Well, that explains it.

But that’s not all, life insurance products now makes up over 22.1% of their total net revenues, compared to 12.2% last year and these products typically generate a higher gross margin than P&C.

Tech it or leave it?

Tech it. The company continues to focus on promoting its CNpad mobile app and its Baoxian.com insurance comparison portal; all in the name of cost control. In the numbers, CNpad and Baoxian.com contributed to 26.6% in aggregate of the company’s total insurance premiums. That being said, CNpad is a B2B portal used by agents and Baoxian.com is a B2C portal. Big difference. Last. $2.9 million in premium flowed through Baoxian.com; almost the same number as the year before, signaling a lower average purchase per active customer despite a significant increase in the number of active customer accounts. Conversion is almost always an issue.