China: Automobile chips have insurance now with the facilitation of multiple national departments
In order to alleviate the “chip shortage” problem in the auto industry, China has recently worked with related companies to formulate an auto chip insurance mechanism, aiming to promote chip companies, component companies and insurance companies. Specifically, the government will carry out pilot work on auto chip insurance and premium subsidies, solve the problem of auto chip application through the "market-oriented + limited government support" approach, and share the upstream and downstream risks of the industry chain through insurance. Automobile chip insurance is an innovative product that covers risk issues in the development and application of automobile chips. At present, the auto chip insurance protection scheme covers many sub-markets in non-auto insurance fields such as liability insurance. Companies can choose one-year or five-year periods. Underwriting conditions such as compensation limits and deductible rates are also negotiated by both parties.
Dong Xiaoping, deputy director of the Electronic Information Department of the Ministry of Industry and Information Technology, believes that automobile chip insurance is another useful attempt to promote the application of domestic automobile chip products. Auto chip insurance shares the user's risk by market segmentation, which helps to enhance the auto industry’s confidence in purchasing and using new domestic automotive semiconductor products, promotes its accelerated application in vehicles, and realizes the mutual benefits of the automotive industry, automotive semiconductor industry, and insurance industry.
Source: Economic Daily
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