China COSCO Shipping Group founded a captive insurance company last week in Shanghai Pilot Free Trade Zone, the first captive insurer in the zone and the third self-insurance firm in China. The first two were set up by PetroChina and China Railway Corporation.

Self-insurance means a business carries risks itself without using a third-party insurance company. About 7 percent of Fortune 500 companies have self-insurance affiliates. The practice was approved by the China Insurance Regulatory Commission in December 2013.

COSCO is a big state-owned shipping company. COSCO Captive Insurance Co Ltd is expected to meet the insurance demands of the group and its affiliates for overseas business development.

Source: Shanghai FTZ Government.cn