Shanghai-headquartered health and finance giant Fosun has rolled out its mutual aid health plan, a popular alternative to health insurance in China, inside a WeChat mini program called Fosun Huzhu.
The plan, managed by Fostars, Fosun’s insurance tech arm, provides participants aged between 28 days and 50 years with a basic health plan covering costs related to 105 critical illnesses.
Like other mutual aid products, Fosun Huzhu does not require admission fees, nor yearly payments, which differentiates it from commercial insurance policies. Instead, when a participant makes a claim to cover a medical bill, the user receives a one-time payout where the cost is shared equally with all other members.
However, Fosun adds in the mini program that this plan is still in the “preparation phase” and has to wait for at least 300,000 members to join before turning effective. This requirement differs Fosun Huzhu from other mutual aid products which do not have such a waiting period.
Xiaomi Finance, the finance arm of smartphone vendor Xiaomi (HKG: 1810), rolled out Xiaomi Huzhu on June 15 inside the app of Xiaomi Finance and also a WeChat mini program. This mutual aid plan has gathered more than 18,000 users by Tuesday.
Since its founding in 1992, Fosun has built a business empire covering pharmaceuticals, real estate, as well as venture capital, and has accumulated total assets of RMB 715.7 billion (USD 102 billion) by the end of 2019. It is one of several conglomerates looking to expand into the mutual aid market, which is expected to have 450 million users by 2025, triple the number in 2019.
Ant Group, which was renamed from Ant Financial in May, is the largest player with more than 100 million users of its mutual aid product called Xiang Hu Bao, which is inside Alipay.
Retailer Suning and China’s largest ride-hailing platform Didi Chuxing both have their mutual aid products, but with relatively small user bases compared with Ant Group. There is no public information showing how many users are in Suning’s Ninghubao. As of Tuesday, Diandi Shouhu has gained nearly 1.1 million users.
Read more: Mutual aid plans, not health insurance, emerge as go-to coverage solution in China