Xiaomi has officially introduced “Xiaomi Auto Insurance,” a new coverage product that is attracting strong attention from vehicle owners thanks to its competitive pricing and expanded service benefits.
Drivers searching for policy renewals recently discovered the offering, which appears to undercut traditional insurers while providing additional services. A renewal screenshot shared by a vehicle owner shows a premium quote of 4,794.65 yuan underwritten by BNP Paribas Cardif Tianxing, while quotes from conventional insurance providers exceeded 5,000 yuan. The policy also includes eight roadside assistance services, vehicle inspections, and safety checks, making the package particularly appealing for cost-conscious drivers.
Online reactions have been mixed. Supporters believe Xiaomi could once again become a “price disruptor,” potentially addressing long-standing concerns over high insurance premiums for new-energy vehicles. Others remain cautious, choosing to wait and see whether the company can deliver reliable claims services and operational stability.
Automakers Expanding Into Insurance
Xiaomi’s entry into the insurance market follows a broader trend of automakers expanding into financial services. The actual underwriter behind Xiaomi Auto Insurance is Beijing BNP Paribas Cardif Tianxing Property & Casualty Insurance Co., Ltd.
Public records show the company was established on December 16, 2025, with a registered capital of 1 billion yuan. Its shareholder structure includes BNP Paribas Cardif with a 49% stake, Sichuan Yinmi Technology with 33%, and Volkswagen Financial Services Overseas with 18%. Sichuan Yinmi Technology is wholly owned by Beijing Xiaomi Electronic Software Technology, which is 90% controlled by Xiaomi founder Lei Jun.
In response to market speculation, staff at BNP Paribas Cardif Tianxing stated that the insurer operates independently despite Xiaomi’s involvement as a major shareholder. The business is currently running a pilot program, offering limited renewal services in Beijing starting March 5, 2026, with no immediate plans for expansion into other regions.
Automakers entering the insurance sector has become increasingly common. Industry estimates suggest that around 20 original equipment manufacturers (OEMs) have ventured into the market by establishing or acquiring insurance brokerage firms.
For example, Li Auto acquired Yinjian Insurance Broker in 2022 and renamed it Beijing Li Auto Insurance Broker. NIO also entered the sector by acquiring Huiding Insurance Broker, later rebranding it as NIO Insurance Broker. In 2023, BYD fully acquired Yi’an Property Insurance and renamed it BYD Insurance, subsequently gaining approval to provide nationwide compulsory traffic insurance coverage.
Other manufacturers have followed similar paths. GAC Group established Zhongcheng Insurance, FAW Group launched Xin’an Auto Insurance, and Geely Group invested in Hezhong Property Insurance.
A Rapidly Growing EV Insurance Market
The growing interest from automakers reflects the rapid expansion of the new-energy vehicle (NEV) market, which is creating enormous demand for specialized insurance products. Consulting firm McKinsey estimates that NEV insurance premiums could reach approximately 480 billion yuan by 2030, accounting for more than 40% of total auto insurance premiums.
Automakers also possess valuable advantages through direct access to vehicle data and customer ecosystems. According to new-energy vehicle expert Yang Weibin, traditional insurance distribution often involves multiple intermediaries. Automakers can streamline these layers, lowering operational costs and potentially reducing insurance premiums for drivers.
By integrating vehicle sales, insurance services, and after-sales repairs, manufacturers are also able to build a more comprehensive service ecosystem that strengthens customer loyalty.
Potential Disruption to the Insurance Landscape
Industry observers believe companies like Xiaomi could become disruptive forces within the NEV insurance market. While a single new entrant may not immediately transform market share, new pricing models and digital service approaches could pressure traditional insurers to accelerate reforms in product design, digital infrastructure, and distribution channels.
BNP Paribas Cardif Tianxing is expected to explore innovations such as smart auto insurance, IoT-based coverage, and data-driven pricing models based on vehicle telematics and onboard data.
For EV owners, the most direct impact could be seen in premium pricing and service quality. The NEV insurance sector has long faced a paradox in which drivers complain about high premiums while insurers struggle to achieve profitability. Usage-Based Insurance (UBI) models promoted by automakers—where premiums are determined by driving behavior—may push traditional insurers to accelerate digital transformation.
BYD’s Insurance Business Offers Early Insights
BYD’s insurance operations provide an early example of how automaker-led insurance models may evolve. In 2025, BYD Insurance generated 2.871 billion yuan in revenue and recorded a net profit of 93.624 million yuan. Over the same period, the average premium per vehicle declined from about 4,900 yuan in the second quarter to around 3,800 yuan by the end of the year.
A major factor behind the cost reduction was BYD’s direct sales model. During 2025, 100% of written premiums were generated through direct channels, eliminating commissions and brokerage fees typically paid to agents and intermediaries. This approach significantly reduced costs and allowed savings to be passed on to drivers.
Challenges Still Ahead
Despite these advantages, automakers entering the insurance sector still face several challenges. The most significant risk lies in claims management, particularly as new-energy vehicles often carry higher repair costs and elevated loss ratios.
Although some automaker-backed insurers have reported profits, their combined cost ratios frequently exceed 100%, meaning underwriting losses are often offset by investment income rather than operational efficiency.
The challenge becomes even more complex when ride-hailing fleets account for a large share of insured vehicles, as these fleets typically carry higher risk profiles.
To achieve long-term sustainability, automakers will need to strengthen their capabilities in actuarial analysis, underwriting discipline, and claims services. Nevertheless, the transparency, data-driven pricing, and integrated service ecosystems introduced by manufacturers are already injecting fresh momentum into China’s rapidly evolving auto insurance market.
