China’s first insurance policy to use the digital yuan for billing was issued in Shenzhen, local media reported. The new product, aimed at healthcare workers exposed to coronavirus risks, is offered by the country’s largest insurer, Ping An. The financial giant also has fintech and healthtech companies under its roof.
Ping An is partnering with the Bank of China to offer digital yuan insurance
In another important step towards the wider use of China’s digital central bank currency (CBDC), the first insurance policies with digital yuan accounting were introduced in Shenzhen, Guangdong Province. They are the result of the collaboration between the local subsidiary of Ping An Property Insurance and the Bank of China branch in the city, the Shenzhen Special Zone Daily reported.
The new insurance product is aimed at medical workers in the Nanshan District in Shenzhen. The policy provides coverage of 300,000 yuan (over US $ 46,000) for deaths from Covid-19 infection, according to the English-language newspaper Global Times in an article.
Insured health care workers are also entitled to 50,000 yuan (around $ 7,700) if they are diagnosed with Covid and the same amount in the event of an accidental death. Those who pay for their insurance with a digital yuan wallet also receive an exclusive preferential flat rate, the publication said.
Ping An’s offering represents a pilot implementation of the Chinese digital fiat in the insurance market. The Chinese giant intends to investigate the use of digital RMB in claims, payments and other insurance scenarios, according to a representative from its Shenzhen office. Wang Peng, Assistant Professor at the Gaoling School of Artificial Intelligence, Renmin University, commented:
[The move] aims to cultivate user habits for broader application scenarios, as previous attempts have mainly focused on e-commerce and online payments.
Shenzhen is one of several major cities participating in a government campaign to promote the use of the digital yuan through giveaways and lotteries with red envelopes, the others being Suzhou, Beijing, Chengdu and Shanghai. China has so far distributed $ 40 million in digital yuan in red envelopes, Bitcoin.com News reported earlier this month, of which $ 35 million has been distributed to these five metropolitan areas.
The public testing of the digital yuan began in Shenzhen in mid-October when the local government and People’s Bank of China distributed 50,000 red envelopes each containing 200 digital yuan. The handouts were reportedly part of China’s first such experiment.
Do you think medical workers in Shenzhen will take advantage of the new digital yuan insurance? Let us know in the comments section below.
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