MoST calls on insurance industry to support innovation
What happened: On February 28, the Ministry of Science and Technology (MoST) and three other agencies released guidelines on developing a sci-tech insurance system to support tech innovation.
Why it matters: Pioneering new tech is expensive and risky business, from initial R&D spending all the way through product launch.
- Companies and investors are naturally exposed to potentially big losses, but so are early adopters of products with limited track record.
- Workers at startups can take on significant risk themselves.
The state is asking insurers to share the burden of these uncertain R&D outcomes, and thereby make it easier for companies, investors, and individuals to act boldly. Beijing wants to see more:
- Insurance products for R&D expense losses, tech transfer failures, and first-batch product trials
- Expanded IP insurance covering patent litigation and overseas IP disputes
- Network security insurance to cover cyber risks
Some context: Products covering some of these areas already exist on the global market. For example, “technology performance insurance” is offered in the energy sector to encourage the adoption of clean tech.
- Chinese policymakers want a whole ecosystem of such products.
What caught our eye: The guidelines single out frontier fields for special treatment.
- "We will develop dedicated sci-tech insurance products in key areas like AI, integrated circuits, quantum tech, bio-manufacturing, hydrogen and fusion energy, brain-computer interfaces, and embodied intelligence."
Get smart: This is about leveraging insurance in China's push for tech self-sufficiency.
- Implemented fully, insurance providers will be transformed into an active participant in sci-tech innovation.