Insurers to Lend Chip Firms Hand
Insurers,insurance companies are designing tailored insurance services to encourage the development and use of domestically developed chip products. This arrangement is expected to help chip firms cut R&D costs and attract more customers. In Washington, however, export controls continue to be tightened, making the opportunity for these companies to expand into foreign markets limited.
Chinese insurance companies are designing tailor-made insurance services to promote the use of domestically developed Lend Chip products
As China’s chip industry grows and becomes more sophisticated, more insurance companies are offering custom-made insurance policies to help domestic chip makers overcome the challenges of globalization. According to a recent report by China Daily, insurance companies in China are drafting plans to promote the use of domestic EDA tools and chip-making equipment. The insurance policies will help chip makers reduce their R&D costs and achieve breakthroughs in core technologies, and they will also stabilize their supply chains.
Currently, only a few companies in China are able to manufacture high-layer-count, flexible boards and specialty PCB-type products. But with the Belt and Road Initiative, the Chinese economy has achieved remarkable progress. It is now home to the largest social security system in the world, with nearly one billion people covered by basic medical insurance and nearly one billion people with old-age insurance. Moreover, 23 million urban shanty-town homes in China have been renovated.
They can help lower R&D costs
Chinese insurers are increasingly focusing on developing customized financial services to help chip firms lower R&D costs and overcome technological bottlenecks. In October, the nation’s top industry regulator, the Ministry of Industry and Information Technology, encouraged insurance companies to roll out chip services as a way to help chip firms boost their confidence and ease chip shortages. Earlier this year, 18 insurance companies announced a strategic alliance in Shanghai.
Some of the federal government’s recent stimulus packages include subsidies for R&D. These are intended to reduce the nation’s reliance on semiconductors produced abroad, build a more resilient supply chain, and stimulate technological innovation. The federal government is making the largest investment ever in public R&D to ensure U.S. economic competitiveness and innovation. This effort is particularly important given Taiwan’s rise as a manufacturing powerhouse, which is a potential threat to the U.S. economy. Although Taiwan is considered an independent nation, China claims its territory.
The CHIPS and Science Act of 2022 includes incentives to help chip manufacturers lower their costs. It authorizes nearly $170 billion in federal funding for strategic R&D and provides $50 billion to firms that adopt the latest technologies. The Act also creates an R&D tax credit for chip manufacturers that invest in research and development.
They can encourage more customers to use them
Insurers are exploring market-driven ways to promote the growth of China’s chip industry. These include developing chip insurance services and easing technical bottlenecks. They can help chip companies cut R&D costs and encourage more customers to use indigenous chips.Chinese insurance companies are designing tailor-made insurance services to promote the use of domestically developed chip products as part of the nation’s broader push to boost the homegrown semiconductor sector, people familiar with the matter said.Chinese insurance companies are designing tailor-made insurance services to promote the use of domestically developed chip products as part of the nation’s broader push to boost the homegrown semiconductor sector, people familiar with the matter said.
Insurance companies are developing plans to promote homegrown chipmaking equipment and EDA tools. These tools are crucial in the design of chips. As long as they offer transparency on how these data are used, they should encourage more customers to share their data. Insurers can use customer-centric analytics to enrich customer data, while focusing on deepening customer understanding.