China's auto exports hit 7.098 million units in 2025, up 21.1% year-on-year. New Energy Vehicles (NEVs) alone accounted for 2.615 million units, making up roughly 37% of that total. As Chinese automakers race into global markets, the game has changed completely: it is no longer just about shipping vehicles; it is about building an entire ecosystem — manufacturing, distribution, after-sales service, and critically, insurance.
Auto insurance is no longer a peripheral add-on. It is a structural prerequisite for sustainable overseas expansion. The underwriting of vehicles sold abroad must be tightly coupled with automakers' go-to-market strategies. Where repair networks are thin, spare parts rely heavily on imports, and claims costs run high, the absence of fit-for-purpose insurance quickly erodes consumer confidence and brand equity.
Furthermore, local regulatory licensing requirements compel insurers and automakers to cooperate. Through localized front-end underwriting paired with cross-border reinsurance and technical enablement, risk can be effectively priced, transferred, and serviced within each host jurisdiction.
Below are the key dimensions of this insurer–automaker convergence, along with their legal and commercial implications for cross-border automotive operations.
1. Three ways automakers and insurers are teaming up
The traditional siloed approach is now replaced by three dominant models:
- Bundled sales. Insurance is sold directly with the vehicle. For example, Geely partnered with Ping An P&C for its 2025 Australia launch; BYD built Thailand after-sales infrastructure specifically around streamlined claims handling.
- Local issuance + Chinese reinsurance. A locally licensed insurer issues the policy on the ground, while a Chinese insurer absorbs the risk via reinsurance. CPIC teamed with Mitsui Sumitomo and Aon to reinsure over 50,000 Chinese NEVs in Thailand using this exact model.
- Full-chain coverage. Factory construction, freight, extended warranties, corporate liability are all bundled into a single, comprehensive cross-border programme.
Because core NEV data — including battery management systems (BMS) and smart networking parameters — resides entirely with automakers, insurers depend on that data for actuarial accuracy. Regulatory authorities in China have explicitly encouraged the establishment of overseas insurance service networks through co-insurance and reinsurance. This makes strategic data-sharing partnerships between automakers and insurers a structural necessity rather than a commercial option.
2. The licensing trap
Most host jurisdictions require that compulsory third-party liability insurance be issued exclusively by a locally licensed insurer. For Chinese market entrants, the only viable route in is indirect: reinsurance, co-insurance, or technical enablement.
Under the “local issuance + Chinese reinsurance” model, the legal relationship between the reinsurance contract and the underlying local policy raises a fundamental privity-of-contract question: local policyholders cannot directly claim against Chinese reinsurers. To mitigate this gap, contractual frameworks should specify front-end claims settlement procedures and back-end reinsurance clearing mechanisms. This ensures that liability flows remain transparent, seamless, and enforceable across jurisdictions.
3. One car, different cover, different countries
Advanced coverages- such as battery degradation cover, charging-pile liability, usage-based insurance (UBI) — are highly mature in China, but they are often unrecognised or unapproved abroad. The EU and much of Southeast Asia demand strict pre-approval of all insurance clauses.
Discrepancies in approved coverage for the same vehicle model sold in different markets create legal exposure. If claims standards diverge materially, automakers and insurers face the risk of class-action litigation abroad. Companies should therefore embed localized clause customization and compliance review into their product development cycle. Furthermore, partnership agreements must clearly allocate product liability, insurance liability, and owner-assumed risk among the parties involved.
4. Data rules can void your policy
Accurate NEV risk pricing runs on driving and charging data. However, global privacy laws strictly police how that data is collected, consented to, and moved across borders. For example, key frameworks include:
- GDPR (European Union) -featuring fines up to 4% of global turnover
- PDPA (Thailand)
- LGPD (Brazil)
- PIPL (China)
Any failure in data compliance can render an insurance policy void or legally unenforceable. Cross-border operators must integrate independent, upfront consent-authorization checkpoints directly into the combined vehicle-purchase and insurance-application workflow. Additionally, partnership agreements between automakers and insurers should also include data-compliance liability clauses to allocate responsibility if a data-collection violation invalidates underlying policies.
We help you to navigate this terrain — structuring cross-border insurance programs and agreements, assisting you with regulatory mapping and requirements and resolving potential disputes when claims or data issues go wrong.
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.
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