ZHONGAN ONLINE P & C INSURANCE CO., LTD.

ZhongAn Online P & C Insurance Co., Ltd.

6060

CNE100002QY7

Property & Casualty Insurance

Delayed Hong Kong S.E. Other stock markets 09:20:28 2024-06-02 pm EDT			5-day change	1st Jan Change
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May. 13	ZhongAn Online P&C Insurance Logs 9.7 Billion Yuan in January-April Gross Written Premiums	MT
May. 13	ZhongAn Online P & C Insurance Co., Ltd. Reports Unaudited Gross Written Premiums for the Period from January 1, 2024 to April 30, 2024	CI

ZhongAn Online P & C Insurance : (1) REVISION OF ANNUAL CAP OF EXISTING CONTINUING CONNECTED TRANSACTION; (2) CONTINUING CONNECTED TRANSACTIONS IN RELATION TO THE NEW ONLINE PLATFORM COOPERATION FRAMEWORK AGREEMENT AND THE AUTO CO-INSURANCE COOPERATION AGREEMENTS; AND (3) SUPPLEMENTAL NOTICE OF EGM

November 21, 2019 at 06:11 am EST

THIS DOCUMENT IS IMPORTANT AND REQUIRES YOUR IMMEDIATE ATTENTION

If you are in doubt as to any aspect of this circular or as to the action to be taken, you should consult a stockbroker or other licensed securities dealer, bank manager, solicitor, professional accountant or other professional advisers.

If you have sold or transferred all your shares in ZhongAn Online P & C Insurance Co., Ltd., you should at once hand this supplemental circular and the accompanying proxy form to the purchaser or the transferee or to the bank, stockbroker or other agent through whom the sale or transfer was effected for transmission to the purchaser or the transferee.

Hong Kong Exchanges and Clearing Limited and The Stock Exchange of Hong Kong Limited take no responsibility for the contents of this supplemental circular, make no representation as to its accuracy or completeness and expressly disclaim any liability whatsoever for any loss howsoever arising from or in reliance upon the whole or any part of the contents of this supplemental circular.

眾安在綫財產保險股份有限公司

ZHONGAN ONLINE P & C INSURANCE CO., LTD.*

(A joint stock limited company incorporated in the People's Republic of China with limited liability

and carrying on business in Hong Kong as "ZA Online Fintech P & C")

(Stock Code: 6060)

1. REVISION OF ANNUAL CAP OF EXISTING CONTINUING CONNECTED TRANSACTION;
CONTINUING CONNECTED TRANSACTIONS IN RELATION TO THE NEW ONLINE PLATFORM COOPERATION FRAMEWORK AGREEMENT AND THE AUTO CO-INSURANCE COOPERATION AGREEMENTS; AND
1. SUPPLEMENTAL NOTICE OF EGM

Independent Financial Adviser to the Independent Board Committee and

the Independent Shareholders

This supplemental circular should be read in conjunction with the circular of the EGM dated November 12, 2019.

The Original Notice of EGM convening the EGM to be held at 10:00 a.m. on Friday, December 27, 2019 at Conference Room 1, 2/F, 219 Yuanmingyuan Road, Huangpu District, Shanghai, the PRC, was despatched to the Shareholders on November 12, 2019, which is available on the website of the Company (www.zhongan.com) and the Stock Exchange (www.hkexnews.hk). The Supplemental Notice of EGM, which contains additional resolutions to be proposed at the EGM, is set out on pages SEGM-1 to SEGM-3 of this supplemental circular.

A supplemental proxy form for the EGM is enclosed with this supplemental circular. If you intend to appoint a proxy to attend the EGM, you are required to complete and return the accompanying supplemental proxy form in accordance with the instructions printed thereon not less than 24 hours before the time appointed for the holding of the EGM (i.e. before 10:00 a.m. on Thursday, December 26, 2019) or any adjournment thereof (as the case may be).

References to time and dates in this supplemental circular are to Hong Kong times and dates.

* For identification purposes only and carrying on business in Hong Kong as "ZA Online Fintech P & C".

November 22, 2019

CONTENTS
	Page
DEFINITIONS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	1
LETTER FROM THE BOARD . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	8
LETTER FROM THE INDEPENDENT BOARD COMMITTEE . . . . . . . . . . . . . . . . . .	19
LETTER FROM THE INDEPENDENT FINANCIAL ADVISER . . . . . . . . . . . . . . . . . .	21
APPENDIX I GENERAL INFORMATION. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	I-1
SUPPLEMENTAL NOTICE OF THE EGM . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	SEGM-1

− i −

DEFINITIONS

In this circular, the following expressions have the following meanings unless the context otherwise requires:

"2019 Announcement"	the announcement dated November 8, 2019, in relation to,
	among others, the revision of Revised Ant Financial Online
	Platform Annual Cap for the continuing connected
	transactions under the Online Platform Cooperation
	Framework Agreement for the year ending December 31,
	2019 and the entering into of the New CCT Agreements
"Ant Financial"	Ant Small and Micro Financial Services Group Co., Ltd.# (浙
	江螞蟻小微金融服務集團股份有限公司), a limited liability
	company incorporated in the PRC (formerly known as
	Zhejiang Alibaba E-Commerce Co., Ltd.# (浙江阿里巴巴電子
	商務有限公司)) on October 19, 2000 and one of our
	substantial shareholders
"Ant Financial Annual Caps"	the proposed maximum aggregate annual value for the
	continuing connected transactions under the New Online
	Platform Framework Agreement for the financial year ending
	December 31, 2020 as described under the section headed "3.
	Entering into of the New CCT Agreements - (1) New Online
	Platform Cooperation Framework Agreement - (ii) Annual
	caps" in this circular
"Ant Financial Group"	Ant Financial and its subsidiaries
"Ant Financial Independent	Shareholders other than Ant Financial and its associates
Shareholders"
"April 2019 Announcement"	the announcement of the Company dated April 10, 2019 in
	relation to, among others, the Revised Ant Financial Online
	Platform Annual Cap
"associate(s)"	has the meaning ascribed thereto under the Listing Rules
"Auto Co-insurance Agreement"	the co-insurance agreement dated November 8, 2019 entered
	into between the Company and Ping An P&C for the
	provision of auto co-insurance to the public
"Auto Co-insurance Cooperation	the Auto Co-insurance Agreement and the Auto Co-insurance
Agreements"	Cooperation Framework Agreement

The English translation of the Chinese company names in this supplemental circular are included for reference only and should not be regarded as the official English translation of such Chinese company names.

− 1 −

	DEFINITIONS
"Auto Co-insurance Cooperation	the co-insurance framework agreement dated November 8,
Framework Agreement"	2019 entered into between the Company and Ping An P&C for
	the provision of auto co-insurance to the public
"Auto Co-insurance Independent	Shareholders other than Ping An P&C and its associates
Shareholders"
"Board" or "Board of Directors"	the board of directors of the Company
"CBIRC"	the China Banking and Insurance Regulatory Commission (中
	國銀行保險監督管理委員會)
"Chief Executive(s)"	has the meaning ascribed to it under the Listing Rules
"close associate(s)"	has the meaning ascribed thereto under the Listing Rules
"Company"	ZhongAn Online P & C Insurance Co., Ltd. (眾安在綫財產保
	險股份有限公司), a joint stock limited company incorporated
	in the PRC with limited liability and carrying on business in
	Hong Kong as "ZA Online Fintech P & C", the H Shares of
	which are listed on the Main Board of the Stock Exchange
	(stock code: 6060)
"connected person(s)"	has the meaning ascribed to it under the Listing Rules
"continuing connected	has the meaning ascribed to it under the Listing Rules
transaction(s)"
"Director(s)"	the director(s) of the Company
"Domestic Shares"	ordinary shares of RMB 1 each issued by the Company, which
	are subscribed for in RMB or credited as fully paid up
"EGM"	the extraordinary general meeting of of the Company to be
	held at Conference Room 1, 2/F, 219 Yuanmingyuan Road,
	Huangpu District, Shanghai, the PRC at 10:00 a.m. on Friday,
	December 27, 2019, for the Shareholders to consider among
	other things, and, if thought fit, to approve the resolutions
	contained in the Original Notice of EGM and Supplemental
	Notice of EGM, or any adjournment thereof

− 2 −

	DEFINITIONS
"Existing Ping An Auto	the agreement dated January 25, 2015 entered into between
Co-insurance Agreement"	the Company and Ping An P&C to provide auto co-insurance
	to the public (the details of which are set out in the section
	headed "Relationship with Connected Persons -
	Transactions with Ping An Group - Cooperation agreement
	for the provision of auto co-insurance, between Ping An P&C
	and us" of the Prospectus), as amended by the agreement
	dated January 1, 2018 entered into between the Company and
	Ping An P&C (the details of which are set out in the January
	2018 Announcement)
"Further Revised Ant Financial	the proposed further revised annual cap for the continuing
Online Platform Annual Cap"	connected transactions under the Online Platform
	Cooperation Framework Agreement for the year ending
	December 31, 2019
"Group"	the Company and its subsidiaries
"H Shares"	overseas listed foreign invested ordinary shares in the share
	capital of the Company, with a nominal value of RMB 1 each,
	which are subscribed for and traded in Hong Kong dollars,
	and "H Shares" means any such Shares
"Hangzhou Alibaba"	Hangzhou Alibaba Network Technology Co., Ltd (杭州阿里
	巴巴網絡科技有限公司)
"Hong Kong"	the Hong Kong Special Administrative Region of the PRC
"Independent Board Committee"	the independent board committee of the Company comprising
	all the independent non-executive Directors established for
	the purpose of giving a recommendation to (i) the Ant
	Financial Independent Shareholders in relation to the Further
	Revised Ant Financial Online Platform Annual Cap as well as
	the New Online Platform Cooperation Framework Agreement
	and the transactions contemplated thereunder, and (ii) the
	Auto Co-insurance Independent Shareholders in relation to
	the Auto Co-insurance Cooperation Agreements and the
	transactions contemplated thereunder

− 3 −

	DEFINITIONS
"Independent Financial Adviser"	Lego Corporate Finance Limited, a licensed corporation to
	carry out type 6 (advising on corporate finance) regulated
	activity under the Securities and Futures Ordinance (Chapter
	571 of the Laws of Hong Kong), being the independent
	financial adviser to the Independent Board Committee, the
	Ant Financial Independent	Shareholders	and	the	Auto
	Co-insurance Independent Shareholders in respect of, as the
	case may be, the Further Revised Ant Financial Online
	Platform Annual Cap, as well as the New Online Platform
	Cooperation	Framework	Agreement and	the	Auto
	Co-insurance Cooperation Agreements and the transactions
	contemplated thereunder
"Independent Shareholders"	Shareholders who are not required to abstain from voting in
	the EGM on all of the resolutions relating to the New CCT
	Agreements and the Further Revised Ant Financial Online
	Platform Annual Cap
"Insuretech"	use of technology innovations designed to achieve savings
	and efficiency from the traditional insurance industry model
"January 2018 Announcement"	announcement of the Company dated January 1, 2018 in
	relation to,	among others,	the Existing	Ping	An	Auto
	Co-insurance Agreement
"Keywise Fund"	Keywise Greater China Opportunities Master Fund
"Latest Practicable Date"	November 19, 2019, being the latest practicable date prior to
	the printing of this supplemental circular for ascertaining
	certain information contained in this supplemental circular
"Listing Date"	September 28, 2017, the date on which the H Shares were
	listed and from which dealings in the H Shares took place on
	the Main Board of the Stock Exchange
"Listing Rules"	the Rules Governing the Listing of Securities on The Stock
	Exchange of Hong Kong Limited, as amended and
	supplemented from time to time
"May 2019 Announcement"	the poll results announcement of the annual general meeting
	of the Company held on May 24, 2019 in relation to, among
	others, the Revised Ant Financial Online Platform Annual
	Cap
"Model Code"	Model Code for Securities Transactions by Directors of
	Listed Issuers, set out in Appendix 10 of the Listing Rules

− 4 −

	DEFINITIONS
"New Continuing Connected	collectively, the transactions contemplated under the New
Transactions"	CCT Agreements
"New CCT Agreements"	the New Online Platform Cooperation Framework Agreement
	and the Auto Co-insurance Cooperation Agreements
"New Online Platform	the agreement dated November 8, 2019 entered into between
Cooperation Framework	the Company and Ant Financial for the provision of insurance
Agreement"	products to various parties
"Online Platform Cooperation	the agreement dated September 11, 2017 entered into between
Framework Agreement"	the Company and Ant Financial for the provision of insurance
	products to various parties, the details of which are set out in
	the section headed "Relationship with Connected Persons -
	Non-exempt Continuing Transactions - Transactions with
	Ant Financial Group and its Associates - Online platform
	cooperation agreement between Ant Financial and/or its
	associates and us" of the Prospectus, the April 2019
	Announcement and the May 2019 Announcement
"Original Circular"	the circular of the Company in relation to, among other
	things, the adjustment of the emoluments of independent
	non-executive directors of the Company, dated November 12,
	2019
"Original Notice of EGM"	the notice of the EGM of the Company dated November 12,
	2019, which is available on the websites of the Company
	(www.zhongan.com)	and	the	Stock	Exchange
	(www.hkexnews.hk)
"Original Proxy Form"	the proxy form sent together with the Original Circular
"Ping An Annual Caps"	the proposed maximum aggregate annual value for the
	continuing	connected	transactions	under	the	Auto
	Co-insurance Cooperation Agreements for the three financial
	years ending December 31, 2022 as described under the
	section headed "3. Entering into of the New CCT Agreements
	- (2) Auto Co-insurance Cooperation Agreements - (ii)
	Annual caps" in this circular
"Ping An Group"	Ping An Insurance and its subsidiaries
"Ping An Insurance"	Ping An	Insurance	(Group)	Co.	of	China,	Ltd.
	(中國平安保險(集團)股份有限公司), a	joint	stock	limited

company incorporated in the PRC on March 21, 1988 listed on Main Board of the Stock Exchange (stock code: 02318) and the Shanghai Stock Exchange (stock code: 601318), and one of the Company's substantial shareholders

− 5 −

	DEFINITIONS
"Ping An Life"	Ping An Life Insurance Company of China, Ltd. (中國平安人
	壽保險股份有限公司), a subsidiary of Ping An Insurance
"Ping An P&C"	Ping An Property and Casualty Insurance Company of China,
	Ltd. (中國平安財產保險股份有限公司), a subsidiary of Ping
	An Insurance
"Platform Service Fee"	the platform service fees payable to Ant Financial and/or its
	associates by the Company under the Online Platform
	Cooperation Framework Agreement or the New Online
	Platform Cooperation Framework Agreement, as the case may
	be
"PRC" or "China"	the People's Republic of China
"Prospectus"	the prospectus issued by the Company on September 18, 2017
	in connection with its global offering
"Revised Ant Financial Online	the revised annual cap for the continuing connected
Platform Annual Cap"	transactions under the Online Platform Cooperation
	Framework Agreement for the year ending December 31,
	2019 that was approved on May 24, 2019 by the then
	independent Shareholders
"RMB"	Renminbi, the lawful currency of the PRC
"SFO"	the Securities and Futures Ordinance (Chapter 571 of the
	Laws of Hong Kong), as amended or supplemented from time
	to time
"Share(s)"	Domestic Shares and/or H Shares
"Shareholder(s)"	shareholder(s) of the Company
"Sinolink"	Sinolink Worldwide Holdings Limited (百仕達控股有限公
	司), a company incorporated in Bermuda with limited
	liability whose shares are listed on the Main Board of the
	Stock Exchange (stock code: 1168)
"Stock Exchange"	The Stock Exchange of Hong Kong Limited
"subsidiary(ies)"	has the meaning ascribed to it under the Listing Rules
"substantial shareholder(s)"	has the meaning ascribed to it under the Listing Rules
"Supplemental Notice of EGM"	the supplemental notice of the EGM of the Company dated
	November 22, 2019, as set out on pages SEGM-1 to SEGM-3
	of this supplemental circular

− 6 −

	DEFINITIONS
"Tencent Computer System"	Shenzhen Tencent Computer Systems Company Limited (深
	圳市騰訊計算機系統有限公司), a limited liability company
	incorporated in the PRC on November 11, 1998, one of the
	Company's substantial shareholders
"%"	per cent

− 7 −

LETTER FROM THE BOARD

眾安在綫財產保險股份有限公司

ZHONGAN ONLINE P & C INSURANCE CO., LTD.*

(A joint stock limited company incorporated in the People's Republic of China with limited liability

and carrying on business in Hong Kong as "ZA Online Fintech P & C")

(Stock Code: 6060)

Executive Directors:	Headquarters and principal place of
Mr. Yaping Ou (Chairman of the Board)	business in the PRC:
Mr. Jin Chen	219 Yuanmingyuan Road
Mr. Hugo Jin Yi Ou	Shanghai
	PRC
Non-executive Directors:
Mr. Xinyi Han	Registered office:
Mr. Jimmy Chi Ming Lai	4-5/F, Associate Mission Building
Mr. Xiaoming Hu	169 Yuanmingyuan Road
Mr. Liangxun Shi	Shanghai
Mr. Ming Yin	PRC
Independent non-executive Directors:	Principal place of business in Hong Kong:
Mr. Shuang Zhang	Level 54, Hopewell Centre
Ms. Hui Chen	183 Queen's Road East
Mr. Yifan Li	Hong Kong
Mr. Ying Wu
Mr. Wei Ou^^

(Note:

Mr. Wei Ou shall be an independent non-executive director of the Company upon his qualification as a Director being approved by CBIRC. Mr. Li Du currently serves as an independent non-executive Director and shall retire on the day when Mr. Wei Ou's qualification as a Director is approved by CBIRC.)

November 22, 2019

To the Shareholders

Dear Sir or Madam,

1. 1. REVISION OF ANNUAL CAP OF EXISTING CONTINUING CONNECTED TRANSACTION;
2. CONTINUING CONNECTED TRANSACTIONS IN RELATION TO THE NEW ONLINE PLATFORM COOPERATION FRAMEWORK AGREEMENT AND THE AUTO CO-INSURANCE COOPERATION AGREEMENTS; AND
3. 1. SUPPLEMENT NOTICE OF EGM
For identification purposes only and carrying on business in Hong Kong as "ZA Online Fintech P & C".

− 8 −

LETTER FROM THE BOARD

1. INTRODUCTION

References are made to (i) the 2019 Announcement, and (ii) the Original Circular and the Original Notice of EGM, which sets out the time and venue of the EGM and contain the resolutions to be submitted at the EGM for Shareholders' approval. This supplemental circular of the EGM (the "Supplemental Circular") should be read together with the Original Circular.

The purposes of this Supplemental Circular are to set out the Supplemental Notice of EGM, and provide you with:

further information in respect of the Further Revised Ant Financial Online Platform Annual Cap;
further details of the transactions contemplated under the New CCT Agreements (including the Ant Financial Annual Caps);
the letter from the Independent Board Committee to the Independent Shareholders in respect of the Further Revised Ant Financial Online Platform Annual Cap and the New CCT Agreements (including the Ping An Annual Caps);
the letter from the Independent Financial Adviser to the Independent Board Committee and the Independent Shareholders in respect of the Further Revised Ant Financial Online Platform Annual Cap and the New CCT Agreements; and
the Supplemental Notice of EGM at which relevant resolutions will be proposed to consider and approve the Further Revised Ant Financial Online Platform Annual Cap and the New CCT Agreements.

2. REVISION OF THE REVISED ANT FINANCIAL ONLINE PLATFORM ANNUAL CAP

Reference is made to the Online Platform Cooperation Framework Agreement, which is an online

platform cooperation framework agreement for the provision of insurance products to various parties, pursuant to which the relevant subsidiaries of Ant Financial Group will enter into separate agreements with the Company which will set out the specific terms and conditions (including pricing) according to normal commercial terms provided therein, with a term of three years commencing on the Listing Date, which will be terminated with effect from January 1, 2020 upon the New Online Platform Cooperation Framework Agreement becoming effective.

On May 24, 2019, the original annual cap for the continuing connected transactions under the Online Platform Cooperation Framework Agreement for the year ending December 31, 2019 was revised (i.e., the Revised Ant Financial Online Platform Annual Cap), and the Revised Ant Financial Online Platform Annual Cap was approved by the then independent Shareholders.

− 9 −

LETTER FROM THE BOARD

In light of (i) a rapid surge in demand for the Group's insurance products made available through the online platforms of Ant Financial Group pursuant to the Online Platform Cooperation Framework Agreement during the second half of 2019 resulting from (a) the increase in risk protection awareness among the public in the PRC which has led to an increase in demand for protection related insurance products, in particular, health insurance, and (b) the cooperation between the Group and Ant Financial Group on promoting product innovation and strengthening the education of risk protection awareness of the target group of the Group's insurance products, and (ii) the increase in sales of the Group's insurance products in connection with customer protection in e-commerce transactions resulting from

the strong growth in e-commerce business which is facilitated by the development in mobile internet, and (b) the various promotion activities conducted by Ant Financial Group on its online platforms which have facilitated the development of its own business, and in turn, benefited the Company's sales of insurance products relating to customer protection on such online platforms, the Board expects that the Revised Ant Financial Online Platform Annual Cap will not be sufficient to meet the Company's requirements. Accordingly, the Board proposes to increase the Revised Ant Financial Online Platform Annual Cap from RMB1,140,670,000 to RMB1,176,770,000 (i.e. the Further Revised Ant Financial Online Platform Annual Cap).

Basis of the Further Revised Ant Financial Online Platform Annual Cap

The Further Revised Ant Financial Online Platform Annual Cap has been determined by the Board based on (i) the total Platform Service Fees of RMB719,551,180 that have been paid to Ant Financial and/or its associates as of September 30, 2019, which represents approximately 61.2% of the Further Revised Ant Financial Online Platform Annual Cap, (ii) the Platform Service Fees expected to be payable to Ant Financial and/or its associates for the year ending December 31, 2019, which represents approximately 38.8% of the Further Revised Ant Financial Online Platform Annual Cap, taking into account the total Platform Service Fees that have been paid to Ant Financial and/or its associates for the three months ended December 31, 2018 represented approximately 39.2% of the Platform Service Fees for the year ended December 31, 2018, and (iii) the Company's estimated market demand from the date of this announcement until December 31, 2019, taking into account the increase in sales volume with the five existing online platforms operated by Ant Financial Group and/or its business partners through which the Company can sell its insurance products to end users in 2019, and the increase in demand for protection related insurance products, in particular, health insurance, resulting from the increase in risk protection awareness among the public in the PRC.

3. ENTERING INTO OF THE NEW CCT AGREEMENTS

New Online Platform Cooperation Framework Agreement

Date:	November 8, 2019
Parties:	(1)	the Company; and
	(2)	Ant Financial.
Duration:	One year from January 1, 2020 to December 31, 2020

− 10 −

	LETTER FROM THE BOARD
Subject matter:	Relevant subsidiaries of Ant Financial Group will enter into separate
	agreements with the Company which will set out the specific terms and
	conditions (including pricing) according to normal commercial terms
	provided in the New Online Platform Cooperation Framework Agreement.

Historical transaction amounts

The Online Platform Cooperation Framework Agreement is an existing agreement as at the date of this announcement concerning the same subject matter as that of the New Online Platform Cooperation Framework Agreement, which will be terminated with effect from January 1, 2020 upon the New Online Platform Cooperation Framework Agreement becoming effective.

For the years ended December 31, 2016, 2017 and 2018 and the nine months ended September 30, 2019, the total platform fees paid by the Company under the Online Platform Cooperation Framework Agreement were RMB437,700,000, RMB426,957,000, RMB487,624,000 and RMB719,551,180, respectively.

Annual caps

The annual cap for the year ending December 31, 2020 for the New Online Platform Cooperation Framework Agreement is RMB2,010,670,000, which is determined principally with reference to:

the total Platform Service Fees that have been paid to Ant Financial and/or its associates as of the Latest Practicable Date;
the platform service fees expected to be payable to Ant Financial and/or its associates for the year ending December 31, 2020, taking into account (i) the tremendous development of online platforms in the PRC in recent years, in particular, the rapid growth of the Internet property and casualty insurance business, which has given rise to the increase in the gross written premiums received from the Company from its provision of insurance products through the online platforms of Ant Financial Group pursuant to the Online Platform Cooperation Framework Agreement from approximately RMB2,789,569,600 in 2018 to approximately RMB7,072,331,700 in 2019, representing a year-on-year increase of approximately 153.57%, and the Directors' expectation that this growth trend will continue into 2020, (ii) the increase in sales volume with the five existing online platforms operated by Ant Financial Group and/or its business partners through which the Company can sell its insurance products to end users in 2019, and (iii) the remarkable increase in gross written premium of the Group's lifestyle consumption ecosystem business in the first half of 2019 as a result of the Company's enhanced cooperation with Ant Financial Group to actively explore product innovation and updates; and
the Company's estimated market demand for the year ending December 31, 2020, taking into account (i) the rapid growth rate the Company has recorded in the sales of the Internet insurance products through Ant Financial and its partners in 2019, and (ii) the rise of awareness of insurance amongst the general public in the PRC resulting from the increase of their disposal income level and the upgrade of their consumption level.

− 11 −

LETTER FROM THE BOARD

(iii) Pricing policies

The Platform Service Fees payable to Ant Financial and/or its associates by the Company will be determined based on arm's length negotiations between the Company and Ant Financial and/or its associates and according to the following principles:

if there exists comparable market rates paid by independent third parties, the platform service fees shall be based on such prevailing market rates;
if there exists no comparable rates, the platform service fees shall be based on arm's length negotiations; and
if there exists no comparable rates and there are difficulties with regards to arm's length negotiations, the platform service fees can be based on similar transactions' market rates.

The Platform Service Fees will be calculated with reference to the total premium the Company received from the insurance products sold through such platforms, and based on either:

1. a fixed rate of the total premium, which is determined based on a number of factors specific to each insurance product, including the product's risk management level, the promotion offered by the online platform, prevailing market prices for similar insurance products and the scale of the product business; or
2. a formula based on the actual settlement claim in relation to the insurance products.
Reasons for and benefits of entering into the New Online Platform Cooperation Framework Agreement

The Company is one of only four companies with an online insurance licence in China. It is necessary as part of the Company's online business expansion to utilize various online platforms to reach a wider customer base. The cooperation with Ant Financial Group will be beneficial to the Company in light of Ant Financial Group's dominant market position in online platforms in the PRC market as well as its close cooperation with Alibaba and other well-known online platforms.

The Company considers Ant Financial an important ecosystem partner and the customer reach offered by Ant Financial is incomparable to other online platform service providers. Nevertheless, before entering into any agreement under the New Online Platform Cooperation Framework Agreement, the Company will assess its needs and will only enter into these transactions when the agreement is in the best interests of the Shareholders as a whole.

− 12 −

LETTER FROM THE BOARD

Auto Co-insurance Cooperation Agreements

Date:	November 8, 2019
Parties:	(1)	the Company; and
	(2)	Ping An P&C.
Duration:	Three years from January 1, 2020 to December 31, 2022
Subject matter:	The	Company will enter into agreements for the provision of auto
	insurance services and Ping An P&C will be responsible for operating the
	duties (including insuring and making payments pursuant to claims) under
	such	auto insurance agreements. Payments under such auto insurance

agreements will be made to the Company which will then be settled with Ping An P&C.

Historical transaction amounts

The Existing Ping An Auto Co-insurance Agreement is an existing agreement as at the date of this announcement between the Company and Ping An P&C for the provision of auto co-insurance to the public, which will be terminated with effect from January 1, 2020 upon the Auto Co-insurance Cooperation Agreements becoming effective.

For the years ended December 31, 2016, 2017 and 2018 and the nine months ended September 30, 2019, the total premiums the Company received under the Existing Ping An Auto Co-insurance Cooperation Agreement were RMB3,480,000, RMB77,901,000, RMB1,146,030,000 and RMB964,029,000, respectively.

Annual caps
The annual caps for the Auto Co-insurance Cooperation Agreements are as follows:

Year ending	Year ending	Year ending
December 31, 2020	December 31, 2021	December 31, 2022
RMB1,644,500,000 (Note)	RMB2,137,850,000 (Note)	RMB2,779,205,000 (Note)

Note: The annual caps for the Auto Co-insurance Agreement for the years ending December 31, 2020, 2021 and 2022 have been determined principally with reference to:

the premiums received under the Existing Ping An Auto Co-insurance Cooperation Agreement;
the historical growth of actual insured premium of approximately 13.7 times from the year ended December 31, 2017 to the year ended December 31, 2018 and the approximate 13.3% growth in actual auto insurance premiums received for the nine months ended September 30, 2019 as compared to that for the nine months ended September 30, 2018;

− 13 −

LETTER FROM THE BOARD

1. the potential growth of the scale of auto insurance premium which is associated with the expectation that the CBIRC will promulgate changes on how auto insurance premium should be calculated which will be implemented in 2020; and
2. the Company's anticipation of a year-on-year growth rate that does not exceed 30% for the premiums it will receive for its auto insurance business under the Auto Co-insurance Cooperation Agreements for each of the three years ending December 31, 2022, after taking into account:
3. 1. an approximate 10% year-over-year growth rate for the year ending December 31, 2019 being expected for the premiums received by the Company under the Existing Ping An Auto Co-insurance Agreement will continue, and the Company's expectation that this growth rate will continue for each of the three years ending December 31, 2022; and
  2. the relatively conservative approach the Company has decided to adopt in projecting the premiums it will receive under the Auto Co-insurance Cooperation Agreements for the three years ending December 31, 2022, given:
  3. 1. there has been no unanimous growth rate in the Company's auto insurance business across the regions of China, although the Directors are of the view that there is still potential for growth in such business in most regions in China; and
    2. the uncertainty in the growth of the scale of auto insurance premium which is associated with the expectation that the CBIRC will promulgate changes on how auto insurance premium should be calculated that will be implemented in 2020, after taking into account such changes that have occurred in the Shaanxi, Guangxi and Qinghai regions of China.
Pricing policies

The auto insurance premiums are heavily regulated in the PRC and the premium charged under the Auto Co-insurance Agreement is determined at a market rate and approved by the CBIRC. They are determined after careful examination and verification by the business management committee of the department. Members of the committee conduct market analysis and various other procedures to determine all aspects of the product including the pricing. These prices must conform with the terms and regulations set by the Company and be approved by other relevant departments such as the actuary department and the operations management centre. The premium and claim payment sharing ratio between the Company and Ping An Group is agreed by both parties after arm's length negotiations having regard to the fact that Ping An Group will be responsible for the daily operations of the agreement including receiving reports of claims, investigating the claims and maintaining customer records.

Pursuant to the Auto Co-insurance Agreement, the premiums, claims and all fees and expenses incurred in the provision of auto co-insurance pursuant to the Auto Co-insurance Agreement are to be shared by the Company and Ping An P&C in 50% and 50% proportions, respectively.

(iv) Reasons for and benefits of entering into the Auto Co-insurance Cooperation Agreements

Ping An Group is one of the largest insurance providers in the PRC. Property and casualty insurance has been the foundation of its business with steady growth since its inception. The entering into of the Auto Co-insurance Cooperation Agreements, which is a continuation of the existing cooperation between Ping An P&C and the Company in the provision of auto co-insurance to the

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LETTER FROM THE BOARD

public under the Existing Ping An Auto Co-insurance Agreement, represents an affirmation by both parties of the results of the existing cooperation, indicating the determination and confidence of both parties to further deepen the cooperation and marking a higher level of cooperation and business exploration between the parties in the area of auto insurance. In addition, the Auto Co-insurance Cooperation Agreements allow the Company not only to share the risk of claims with Ping An Group but also to reach a wider base of customers and benefit from brand name of Ping An P&C in the PRC market and its expertise in the operation of the provision of auto insurance products. Moreover, the Directors believes that Ping An Group's online auto co-insurance network will provide the Company with a number of opportunities to conduct a variety of business explorations.

4. INFORMATION ON THE PARTIES

The Company

The Company is an online Insuretech company in the PRC and is principally engaged in the provision of insurance products and solutions in the context of five major ecosystems, namely lifestyle consumption, consumer finance, health, auto and travel ecosystems.

Ant Financial

Ant Financial (formerly known as Zhejiang Alibaba E-Commerce Co., Ltd.# (浙江阿里巴巴電子商務有限公司)) is a limited liability company incorporated in the PRC on October 19, 2000. Ant Financial is a technology company that aims to bring accessible financial services to the world. With its mission "to bring the world equal opportunities", Ant Financial is committed to building an open and shared credit system and financial services platform to provide safe and accessible financial services to global consumers and microenterprises through its technological and innovation capabilities. As at the Latest Practicable Date , the shares of Ant Financial are held by Hangzhou Alibaba, Hangzhou Junao and Hangzhou Junhan as to 33%, 21.53% and 28.45%, respectively, and the voting rights of Hangzhou Junnao and Hangzhou Junhan in Ant Financial are controlled by Hangzhou Yunbo, the general partner, which in turn is entirely owned by Yun Ma (馬雲).

Ping An P&C

Ping An P&C is a subsidiary of Ping An Insurance, which is our substantial shareholder. The business scope of Ping An P&C covers all statutory property and casualty business and international reinsurance business including insurance for automobile, commercial properties, construction, liability, cargo, short-term accident and health. As at the date of this announcement, Ping An P&C is controlled by Ping An Insurance, which holds approximately 99.51% of Ping An P&C's shareholding.

The English translation of the Chinese company names in this supplemental circular are included for reference only and should not be regarded as the official English translation of such Chinese company names.

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LETTER FROM THE BOARD

5. LISTING RULES IMPLICATIONS

As at the Latest Practicable Date:

Ant Financial holds approximately 13.53% of the total issued share capital of the Company and is a substantial shareholder of the Company under the Listing Rules. Ant Financial and its subsidiaries are therefore connected persons of the Company under Chapter 14A of the Listing Rules; and
Ping An Insurance holds approximately 10.20% of the total issued share capital of the Company and is a substantial shareholder of the Company. Given Ping An P&C is a subsidiary of Ping An Insurance, Ping An P&C is therefore a connected person of the Company under Chapter 14A of the Listing Rules.

Pursuant to Rule 14A.54 of the Listing Rules, if the Company proposes to revise the annual caps for continuing connected transactions, the Company will have to re-comply with the provisions of Chapter 14A of the Listing Rules applicable to the relevant continuing connected transaction.

As the highest applicable percentage ratio calculated with reference to Rule 14.07 of the Listing Rules in respect of each of the New Continuing Connected Transactions and the Further Revised Ant Financial Online Platform Annual Cap for the continuing connected transactions under the Online Platform Cooperation Framework Agreement are more than 5%, the New Continuing Connected Transactions and the transactions under the Online Platform Cooperation Framework Agreement as captured under the Further Revised Ant Financial Online Platform Annual Cap are subject to the reporting, announcement and independent Shareholders' approval requirements under Chapter 14A of the Listing Rules.

Mr. Guoping Wang, being a non-executive Director and vice general manager of Ping An Life, has abstained from voting on the relevant Board resolutions in relation to each of the Auto Co-insurance Cooperation Agreements and matters contemplated therein. Mr. Xiaoming Hu, being a non-executive Director and president of Ant Financial, and Mr. Xinyi Han, being a non-executive Director and vice president of Ant Financial, have abstained from voting on the relevant Board resolutions in relation to the Further Revised Ant Financial Online Platform Annual Cap as well as the New Online Platform Cooperation Framework Agreement and matters contemplated therein. Save as disclosed above, no other Directors have or are considered to have a material interest in the Further Revised Ant Financial Online Platform Annual Cap as well as the New CCT Agreements and the transactions contemplated thereunder, nor are they required to abstain from voting on the relevant Board resolutions approving the Further Revised Ant Financial Online Platform Annual Cap as well as the New CCT Agreements and the transactions contemplated thereunder.

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LETTER FROM THE BOARD

6. EGM

The EGM of the Company will be held at 10:00 a.m. on Friday, December 27, 2019 at Conference Room 1, 2/F, 219 Yuanmingyuan Road, Huangpu District, Shanghai, the PRC for the Shareholders to consider, and if thought fit, approve the resolutions contained in the Original Notice of EGM and Supplemental Notice of EGM. The voting in relation to such resolutions will be conducted by way of poll.

The Original Notice of EGM was despatched to Shareholders on November 12, 2019 which is available on the websites of the Company (www.zhongan.com) and the Stock Exchange (www.hkexnews.hk). The Supplemental Notice of EGM, which contains the additional resolutions to be proposed at the EGM is set out on pages SEGM-1 to SEGM-3 of this Supplemental Circular.

Ant Financial and its associates and those Shareholders who are involved in or are interested in the transactions contemplated under the Online Platform Framework Cooperation Agreement as captured under the Further Revised Ant Financial Online Platform Annual Cap, as well as New Online Platform Cooperation Framework Agreement and the transactions contemplated thereunder will be required to abstain from voting on the relevant resolutions to be proposed at the EGM. Ping An P&C and its associates and those Shareholders who are involved in or are interested in the Auto Co-insurance Cooperation Agreements and the transactions contemplated thereunder will be required to abstain from voting on the relevant resolutions to be proposed at the EGM.

Since the Original Proxy Form does not contain the additional resolutions as set out in the Supplemental Notice of the EGM, a new proxy form (the "Supplemental Proxy Form") is enclosed with this Supplemental Circular. If any Shareholder has not yet lodged the Original Proxy Form according to the instructions in the Original Notice of EGM and wishes to appoint a proxy to attend the EGM on his/her/its behalf, he/she/it is required to lodge the Supplemental Proxy Form. In this case, the Shareholder shall not lodge the Original Proxy Form. For any Shareholder who has lodged the Original Proxy Form with the Company's H share registrar or the Company's office of the Board of Directors, please note that:

if no Supplemental Proxy Form is lodged with the Company's H share registrar of the Company's office of the Board of Directors, the Original Proxy Form will be treated as a valid proxy form lodged by the Shareholder if duly completed. The proxy so appointed by the Shareholder will be entitled to vote at his or her discretion or to abstain from voting on the resolutions properly put to the EGM other than those referred to in the Original Notice of EGM and the Original Proxy Form;
if the Supplemental Proxy Form is lodged with the Company's H share registrar or the Company's office of the Board of Directors at or before 10:00 a.m. on Thursday, December 26, 2019, the Supplemental Proxy Form, whether duly completed or not, will revoke and supersede the Original Proxy Form previously lodged by the shareholder. The Supplemental Proxy Form will be treated as a valid proxy form if duly completed; and

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LETTER FROM THE BOARD

if the Supplemental Proxy Form is lodged with the Company's H share registrar or the Company's office of the Board of Directors after 10:00 a.m. on Thursday, December 26, 2019, the Supplemental Proxy Form will be deemed invalid. It will not revoke the Original Proxy Form previously lodged by the Shareholder. The Original Proxy form will be treated as a valid proxy form if duly completed. The proxy so appointed by the Shareholder will be entitled to vote at his or her discretion or to abstain from voting on the resolutions properly put to the EGM other than those referred to in the Original Notice of EGM and the Original Proxy Form.

Please refer to the Original Notice of EGM for details about the resolutions to be submitted for consideration and approval at the EGM, eligibility of shareholders to attend the EGM, appointment of proxies, registration procedures, closures of register of members and other matters, and the circular of the Company dated November 12, 2019 for details on the closure of register of members.

7. RECOMMENDATION

Based on the relevant information disclosed herein, the Board considers that the resolutions set out in the Supplemental Notice of the EGM for consideration and approval by the Shareholders are in the interests of the Company and the Shareholders as a whole and accordingly recommends the Shareholders to vote in favor of the resolution in connection with the Further Revised Ant Financial Online Platform Annual Cap and each of the New CCT Agreements to be proposed at the EGM.

For the purpose of the EGM, the Board has established the Independent Board Committee comprising all the independent non-executive Directors to advise (i) the Ant Financial Independent Shareholders in relation to the Further Revised Ant Financial Online Platform Annual Cap as well as the New Online Platform Cooperation Framework Agreement and the transactions contemplated thereunder, and (ii) the Auto Co-insurance Independent Shareholders in relation to the Auto Co-insurance Cooperation Agreements and the transactions contemplated thereunder. The Company has also appointed Lego Corporate Finance Limited to be the independent financial adviser of the Company, to advise the Independent Board Committee and the Independent Shareholders in this regard.

The letter of advice from the Independent Financial Adviser to the Independent Board Committee and the Independent Shareholders is set out on pages 21 to 46 of this Supplemental Circular.

8. ADDITIONAL INFORMATION

Your attention is also drawn to the information set out in Appendix I to this circular.

By order of the Board

ZhongAn Online P & C Insurance Co., Ltd.

Yaping Ou

Chairman

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LETTER FROM THE INDEPENDENT BOARD COMMITTEE

眾安在綫財產保險股份有限公司

ZHONGAN ONLINE P & C INSURANCE CO., LTD.*

(A joint stock limited company incorporated in the People's Republic of China with limited liability

and carrying on business in Hong Kong as "ZA Online Fintech P & C")

(Stock Code: 6060)

November 22, 2019

To the Independent Shareholders of the Company

Dear Sir or Madam,

1. REVISION OF ANNUAL CAP OF EXISTING CONTINUING CONNECTED TRANSACTION;
CONTINUING CONNECTED TRANSACTIONS IN RELATION TO THE NEW ONLINE PLATFORM COOPERATION FRAMEWORK AGREEMENT AND THE AUTO CO-INSURANCE COOPERATION AGREEMENTS; AND
1. SUPPLEMENTAL NOTICE OF EGM

We refer to the 2019 Announcement and the supplemental circular of the Company dated November 22, 2019 (the "Supplemental Circular") of which this letter forms part. Terms defined in the Supplemental Circular shall have the same meanings when used herein unless the context requires otherwise. We, being the independent non-executive Directors, have been appointed as the Independent Board Committee to advise (i) the Ant Financial Independent Shareholders in connection with the Further Revised Ant Financial Online Platform Annual Cap as well as the New Online Platform Cooperation Framework Agreement and the transactions contemplated thereunder, and (ii) the Auto Co-Insurance Independent Shareholders in connection with each of the Auto Co-Insurance Cooperation Agreements and the transactions contemplated thereunder. Details of the Further Revised Ant Financial Online Platform Annual Cap, the New Online Platform Cooperation Framework Agreement and the Auto Co-Insurance Cooperation Agreements are set out in the Letter from the Board contained in the Supplemental Circular.

We wish to draw your attention to the letter from the Independent Financial Adviser as set out on pages 21 to 46 of the Supplemental Circular.

* For identification purposes only and carrying on business in Hong Kong as "ZA Online Fintech P & C".

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LETTER FROM THE INDEPENDENT BOARD COMMITTEE

Having considered the information set out in the letter from the Board, the terms of each of the New CCT Agreements, the Further Revised Ant Financial Online Platform Annual Cap and the advice of the Independent Financial Adviser in relation thereto as set out on pages 8 to 18 and pages 21 to

46 of the Supplemental Circular, we are of the view that:

the terms of the transactions contemplated under the New Online Platform Framework Agreement and the transactions under the Online Platform Cooperation Framework Agreement as captured under the Further Revised Ant Financial Online Platform Annual Cap (including the Further Revised Ant Financial Online Platform Annual Cap) are fair and reasonable so far as the Ant Financial Independent Shareholders are concerned, on normal commercial terms and conducted in the ordinary and usual course of business of the Group;
the terms of the transactions contemplated under each of the Auto Co-insurance Agreements are fair and reasonable so far as the Auto Co-insurance Independent Shareholders are concerned, on normal commercial terms and conducted in the ordinary and usual course of business of the Group; and
each of the New CCT Agreements and the Further Revised Ant Financial Online Platform Annual Cap are in the interests of the Company and the Shareholders as a whole.

Accordingly, we recommend:

the Ant Financial Independent Shareholders to vote in favour of the relevant resolutions to be proposed at the EGM to approve the New Online Platform Cooperation Framework Agreement and the Further Revised Ant Financial Online Platform Annual Cap; and
the Auto Co-insurance Independent Shareholders to vote in favour of the relevant resolutions to be proposed at the EGM to approve the Auto Co-insurance Cooperation Agreements.

Your faithfully

Independent Board Committee

Mr. Shuang Zhang

Ms. Hui Chen

Mr. Yifan Li

Mr. Ying Wu

Mr. Li Du^^

Independent non-executive Directors

(Note: ^^ Mr. Wei Ou shall be an independent non-executive Director upon his qualification as a Director being approved by the CBIRC. Mr. Li Du currently serves as an independent non-executive Director and shall retire on the day when Mr. Wei Ou's qualification as a Director is approved by the CBIRC.)

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LETTER FROM THE INDEPENDENT FINANCIAL ADVISER

The following is the full text of a letter of advice from Lego Corporate Finance Limited, the independent financial adviser to the Independent Board Committee and the Independent Shareholders, which has been prepared for the purpose of incorporation into this supplemental circular, setting out its advice to the Independent Board Committee, the Ant Financial Independent Shareholders in relation to the Further Revised Ant Financial Online Platform Annual Cap as well as the New Online Platform Cooperation Framework Agreement and the transactions contemplated thereunder, and the Auto Co-insurance Independent Shareholders in relation to the Auto Co-insurance Cooperation Agreements and the transactions contemplated thereunder.

November 22, 2019

To the Independent Board Committee

and the Independent Shareholders

Dear Sir or Madam,

(1) REVISION OF ANNUAL CAP OF

EXISTING CONTINUING CONNECTED TRANSACTION; AND

CONTINUING CONNECTED TRANSACTIONS IN RELATION TO THE NEW ONLINE PLATFORM COOPERATION FRAMEWORK AGREEMENT
AND THE AUTO CO-INSURANCE COOPERATION AGREEMENTS

INTRODUCTION

We refer to our appointment as the Independent Financial Adviser to the Independent Board Committee, the Ant Financial Independent Shareholders in relation to the Further Revised Ant Financial Online Platform Annual Cap as well as the New Online Platform Cooperation Framework Agreement and the transactions contemplated thereunder (including the annual cap for transactions to be contemplated thereunder for the year ending December 31, 2020 (the "2020 Online Platforms Annual Cap")), and the Auto Co-insurance Independent Shareholders in relation to the Auto Co-insurance Cooperation Agreements and the transactions contemplated thereunder (including the annual caps of the transactions to be contemplated thereunder for the three years ending December 31, 2022 (the "Auto Annual Caps")), details of which are set out in the "Letter from the Board" (the

"Letter") contained in the supplemental circular dated November 22, 2019 issued by the Company to the Shareholders (the "Supplemental Circular"), of which this letter forms part. Terms used in this letter shall have the same meanings as defined in the Supplemental Circular unless the context otherwise requires.

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LETTER FROM THE INDEPENDENT FINANCIAL ADVISER

On May 24, 2019, the original annual cap for the continuing connected transactions under the Online Platform Cooperation Framework Agreement for the year ending December 31, 2019 was revised and was approved by the then independent Shareholders. The Board expects that the Revised Ant Financial Online Platform Annual Cap will not be sufficient to meet the Company's need for the transactions contemplated. Accordingly, the Board proposes to increase the Revised Ant Financial Online Platform Annual Cap from approximately RMB1,140.7 million to the Further Revised Ant Financial Online Platform Annual Cap of approximately RMB1,176.8 million.

On November 8, 2019, the Group entered into the New Online Platform Cooperation Framework Agreement to sell various insurance products to end users of Ant Financial Group's online platforms in the ordinary course of business of the Group. Pursuant to the New Online Platform Cooperation Framework Agreement, the 2020 Online Platforms Annual Cap will be amounted to approximately RMB2,010.7 million.

Furthermore, on November 8, 2019, the Group entered into the Auto Co-insurance Cooperation Agreements with Ping An P&C, a subsidiary of Ping An Insurance, to provide auto co-insurance to the public. Pursuant to the Auto Co-insurance Cooperation Agreements, the Company will enter into agreements for the provision of auto insurance services and Ping An P&C will be responsible for operating the duties (including insuring and making payments pursuant to claims) under such auto insurance agreements. Payments under such auto insurance agreements will be made to the Company which will then be settled with Ping An P&C., which the Group and Ping An P&C share the premiums and claim payments in 50% and 50% proportions, respectively. The Existing Ping An Auto Co-insurance Agreement will be terminated with effect from January 1, 2020 and the Auto Co-insurance Cooperation Agreements are for a term of three years which will be effective from January 1, 2020 to December 31, 2022. Under the Auto Co-insurance Cooperation Agreements, the Auto Annual Caps for the three years ending December 31, 2020, 2021 and 2022 are expected to be RMB1,644.5 million, approximately RMB2,137.9 million and approximately RMB2,779.2 million, respectively.

As at the Latest Practicable Date, (i) Ant Financial held approximately 13.53% of the total issued share capital of the Company and is a substantial shareholder of the Company under the Listing Rules. Ant Financial and its subsidiaries are therefore connected persons of the Company under Chapter 14A of the Listing Rules; and (ii) Ping An Insurance held approximately 10.20% of the total issued share capital of the Company and is a substantial shareholder of the Company. Given Ping An P&C is a subsidiary of Ping An Insurance, Ping An P&C is therefore a connected person of the Company under Chapter 14A of the Listing Rules.

As a result, the transactions contemplated under the Online Platform Cooperation Framework Agreement as captured under the Further Revised Ant Financial Online Platform Annual Cap and the New Continuing Connected Transactions constitute continuing connected transactions of the Company under Chapter 14A of the Listing Rules. Pursuant to Rule 14A.54 of the Listing Rules, if the Company proposes to revise the annual caps for continuing connected transactions, the Company will have to re-comply with the provisions of Chapter 14A of the Listing Rules applicable to the relevant continuing connected transaction.

As the highest applicable percentage ratio calculated with reference to Rule 14.07 of the Listing Rules in respect of each of the New Continuing Connected Transactions and the Further Revised Ant

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LETTER FROM THE INDEPENDENT FINANCIAL ADVISER

Financial Online Platform Annual Cap for the continuing connected transactions under the Online Platform Cooperation Framework Agreement are more than 5%, the New Continuing Connected Transactions and the transactions under the Online Platform Cooperation Framework Agreement as captured under the Further Revised Ant Financial Online Platform Annual Cap are subject to the reporting, announcement and independent Shareholders' approval requirements under Chapter 14A of the Listing Rules.

The Independent Board Committee, comprising all the independent non-executive Directors, has been established to advise the (i) the Ant Financial Independent Shareholders in relation to the Further Revised Ant Financial Online Platform Annual Cap as well as the New Online Platform Cooperation Framework Agreement and the transactions contemplated thereunder, and (ii) the Auto Co-insurance Independent Shareholders in relation to the Auto Co-insurance Cooperation Agreements and the transactions contemplated thereunder, and to advise the Independent Shareholders as to whether to vote in favour of the resolution to be proposed at the EGM to approve the Further Ant Financial Online Platform Annual Cap, the New Online Platform Cooperation Framework Agreement (including the 2020 Online Platforms Annual Cap) and Auto Co-insurance Cooperation Agreements (including the Auto Annual Caps). As the Independent Financial Adviser, our role is to give an independent opinion to the Independent Board Committee and the Independent Shareholders in such regard.

As at the Latest Practicable Date, Lego Corporate Finance Limited did not have any shareholding in any member of the Group, Ant Financial Group or Ping An Group or relationships with or interests, directly or indirectly, in any assets which have been or are proposed to be acquired or disposed of by or leased to any member of the Group, Ant Financial Group or Ping An Group since December 31, 2018, that could reasonably be regarded as relevant to the independence of Lego Corporate Finance Limited. In the last two years, other than the engagement in February 2018 and April 2019 as the independent financial adviser to the independent board committee and independent shareholders, in relation to the amendment to the Existing Ping An Auto Co-insurance Cooperation Agreement and the revision of annual cap of the Online Platform Cooperation Framework Agreement (as defined in the circular of the Company dated April 30, 2019), there was no engagement between the Group and Lego Corporate Finance Limited. Apart from normal professional fees being paid or payable to us in connection with this appointment as the Independent Financial Adviser, no arrangements exist whereby we have received or will receive any fees or benefits from the Group, Ant Financial Group or Ping An Group. Accordingly, we are qualified to give independent advice in respect of (i) the Further Revision Ant Financial Online Platform Annual Cap; (ii) the New Online Platform Cooperation Framework Agreement and the 2020 Online Platforms Annual Cap; and (iii) the Auto Co-insurance Cooperation Agreements and the Auto Annual Caps.

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LETTER FROM THE INDEPENDENT FINANCIAL ADVISER

BASIS OF OUR OPINION

In formulating our opinion and advice, we have relied on (i) the information and facts contained or referred to in the Supplemental Circular and the Prospectus; (ii) the information supplied by the Group and its advisers; (iii) the opinions expressed by and the representations of the Directors and the management of the Group (the "Management"); and (iv) our review of the relevant public information. We have assumed that all the information provided and representations and opinions expressed to us or contained or referred to in the Supplemental Circular and the Prospectus were true, accurate and complete in all respects as at the date thereof and may be relied upon. We have also assumed that all statements contained and representations made or referred to in the Supplemental Circular and the Prospectus are true at the time they were made and continue to be true as at the date of the Supplemental Circular and the Prospectus and all such statements of belief, opinions and intention of the Directors and the Management and those as set out or referred to in the Supplemental Circular and the Prospectus were reasonably made after due and careful enquiry. We have no reason to doubt the truth, accuracy and completeness of the information and representations provided to us by the Directors, the Management, and/or the advisers of the Company. We have also sought and received confirmation from the Directors that no material facts have been withheld or omitted from the information provided and referred to in the Supplemental Circular and that all information or representations provided to us by the Directors and the Management are true, accurate, complete and not misleading in all respects at the time they were made and continued to be so until the date of the Supplemental Circular.

We consider that we have reviewed the relevant information currently available to reach an informed view and to justify our reliance on the accuracy of the information contained in the Supplemental Circular so as to provide a reasonable basis for our recommendation. We have not, however, carried out any independent verification of the information provided, representations made or opinion expressed by the Directors and the Management or Ping An Group or Ant Financial Group, nor have we conducted any form of in-depth investigation into the business, affairs, operations, financial position or future prospects of the Group, Ant Financial Group or Ping An Group or any of their respective subsidiaries or associates.

PRINCIPAL FACTORS AND REASONS CONSIDERED IN RELATION TO THE FURTHER REVISED ANT FINANCIAL ONLINE PLATFORM ANNUAL CAP AND THE NEW ONLINE PLATFORM COOPERATION FRAMEWORK AGREEMENT

In arriving at our recommendation, we have considered the following principal factors and reasons:

1. Background of the Group and Ant Financial

Ant Financial (formerly known as Zhejiang Alibaba E-Commerce Co., Ltd.* (浙江阿里巴巴電子商務有限公司)) is a limited liability company incorporated in the PRC on October 19, 2000. Ant Financial is a technology company that aims to bring accessible financial services to the world. With

* The translations are for reference only and should not be regarded as the official translation.

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LETTER FROM THE INDEPENDENT FINANCIAL ADVISER

its mission "to bring the world equal opportunities", Ant Financial is committed to building an open and shared credit system and financial services platform to provide safe and accessible financial services to global consumers and microenterprises through its technological and innovation capabilities.

2. The Further Revised Ant Financial Online Platform Annual Cap

2.1 Background of the revision

Reference is made to the Online Platform Cooperation Framework Agreement, which is an online platform cooperation framework agreement for the provision of insurance products to various parties, pursuant to which the relevant subsidiaries of Ant Financial Group would enter into separate agreements with the Company which would set out the specific terms and conditions (including pricing) according to normal commercial terms provided therein, with a term of three years commencing on the Listing Date.

2.2 Reasons for the revision

As mentioned in the Letter, given that the total Platform Service Fees of approximately RMB719.6 million that have been paid to Ant Financial and/or its associates as of September 30, 2019 already represents approximately 61.2% of the Revised Ant Financial Online Platform Annual Cap and in light of (i) a rapid surge in demand for the Group's insurance products made available through the online platforms of Ant Financial Group pursuant to the Online Platform Cooperation Framework Agreement during the second half of 2019 resulting from (a) the increase in risk protection awareness among the public in the PRC which has led to an increase in demand for protection related insurance products, in particular, health insurance; and (b) the cooperation between the Group and Ant Financial Group on promoting product innovation and strengthening the education of risk protection awareness of the target group of the Group's insurance products; and (ii) the increase in sales of the Group's insurance products in connection with customer protection in e-commerce transactions resulting from

the strong growth in e-commerce business which is facilitated by the development in mobile internet; and (b) the various promotion activities conducted by Ant Financial Group on its online platforms which has facilitated the development of its own business, and in turn, benefited the Company's sales of insurance products relating to customer protection on such online platforms, the Board expects that the Revised Ant Financial Online Platform Annual Cap will not be sufficient to meet the Company's requirements. Accordingly, the Board proposes to increase the Revised Ant Financial Online Platform Annual Cap from approximately RMB1,140.7 million to the Further Revised Ant Financial Online Platform Annual Cap of approximately RMB1,176.8 million.

Having considered that the Group and Ant Financial Group is required to suspend business under the Online Platform Cooperation Framework Agreement should the actual platform service fee equal

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LETTER FROM THE INDEPENDENT FINANCIAL ADVISER

or exceed the Revised Ant Financial Online Platform Annual Cap, which in turn will limit the revenue to be generated by the Group, we are of the view that the adoption of the Further Revised Ant Financial Online Platform Annual Cap is in the interest of the Company and the Shareholders as a whole.

2.3 Basis of the Further Revised Ant Financial Online Platform Annual Cap

As mentioned in the Letter and as advised by the Management, the Further Revised Ant Financial Online Platform Annual Cap has been determined by the Board based on (i) the total Platform Service Fees of approximately RMB719.6 million that have been paid to Ant Financial and/or its associates for the nine months ended September 30, 2019; (ii) the premium of RMB4,311.5 million for the nine months ended September 30, 2019; (iii) the Platform Service Fees expected to be payable to Ant Financial and/or its associates for the period from the date of the Announcement up to December 31, 2019; and (iv) the Company's estimated market demand from the date of the Announcement up to December 31, 2019, taking into account the increase in sales volume with the five existing online platforms operated by Ant Financial Group and/or its business partners, through which the Company can sell its insurance products to end users in 2019, and the increase in demand for protection related insurance products, in particular, health insurance, resulting from the increase in risk protection awareness among the public in the PRC.

Having considered (i) the Platform Service Fees of approximately RMB719.6 million that have been paid to Ant Financial and/or its associates for the nine months ended September 30, 2019 represented approximately 61.2% of the Further Revised Ant Financial Online Platform Annual Cap, and the remaining 38.8% of the Further Revised Ant Financial Online Platform Annual Cap is expected to be utilised for the three months ending December 31, 2019; and (ii) the Further Revised Ant Financial Online Platform Annual Cap only represents an increment of only approximately 3.2% as compared to the Revised Ant Financial Online Platform Annual Cap, which is not significant, we are of the view that the Further Revised Ant Financial Online Platform Annual Cap is not excessive and fair and reasonable so far as the Ant Financial Independent Shareholders are concerned.

3 The New Online Platform Cooperation Framework Agreement

3.1 Principal terms

As disclosed in the Letter, the New Online Platform Cooperation Framework Agreement entered into by the Group and Ant Financial is an online platform cooperation framework agreement for the provision of insurance products to various parties through Ant Financial Group. As a provider of online insurance products, the Group uses online platforms (the "Online Platforms") operated by Ant Financial Group to sell various insurance products to end users of their Online Platforms in the Group's ordinary course of business.

As disclosed in the Letter, the principal terms of the New Online Platform Cooperation Framework Agreement are as follows:

the New Online Platform Cooperation Framework Agreement is for a term of one year commencing on January 1, 2020; and

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LETTER FROM THE INDEPENDENT FINANCIAL ADVISER

relevant subsidiaries of Ant Financial Group will enter into separate agreements with the Company which will set out the specific terms and conditions (including pricing) according to normal commercial terms provided in the New Online Platform Cooperation Framework Agreement.

We have reviewed the New Online Platform Cooperation Framework Agreement and did not note any abnormal terms or material difference between the terms of the Online Platform Cooperation Framework Agreement and the terms of the New Online Platform Cooperation Framework Agreement.

3.2 Pricing policies

As disclosed in the Letter, the platform service fees paid to Ant Financial and/or its associates by the Group are determined based on arm's length negotiations between the Group and Ant Financial and/or its associates. They are determined according to the following principles: (i) if there exists comparable market rates paid by independent third parties, the platform service fees shall be based on such prevailing market rates; (ii) if there exists no comparable rates, the platform service fees shall be based on arm's length negotiations; and (iii) if there exists no comparable rates and there are difficulties with regards to arm's length negotiations, the platform service fees can be based on similar transactions' market rates.

As stated above, relevant subsidiaries of Ant Financial Group will enter into separate agreements with the Company which will set out the specific terms and conditions (including pricing) according to normal commercial terms provided in the Online Platform Cooperation Framework Agreement. As advised by the Management, currently the platform service fees charged by Ant Financial Group are calculated with reference to the total premium the Group receives from the insurance products sold through the Online Platforms. The calculation is either based on (a) a fixed rate of the total premium pursuant to the product agreement entered; or (b) a formula based on the actual settlement claim in relation to the insurance products as detailed below.

We have discussed with the Management and noted that currently there are total three categories of insurance products sold by the Group under the Online Platform Cooperation Framework Agreement, namely health insurance, travel insurance and e-commerce related insurance and it is expected that the said three types of insurance products will continue to be sold by the Group under the New Online Platform Cooperation Framework Agreement.

Under the current arrangements, the platform service fee in relation to e-commerce related insurance products is calculated by multiplying the total premium of the insurance by the surplus of settlement limit after deducting the actual maturity loss ratio times the fixed rate. The actual maturity loss ratio is calculated based on, and is adjusted from time to time in accordance with, the actual claim settlements of the insurance product. The settlement limit is based on the claim settlement limit set for each policy.

Meanwhile, the fixed rate of the total premium received by the Group through Ant Finance Group were adopted in calculating the platform service fee for the health insurance products and travel insurance products. Such fixed rates used in both calculation methods were determined based on a number of factors specific to each insurance product, including the product's risk management level, the promotion offered by the online platform, prevailing market prices for similar insurance products and the scale of the product business.

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We have reviewed sample product agreements entered into by the Group and Ant Financial Group pursuant to the Online Platform Corporation Framework Agreement for each category of insurance products as stated above, and noted that the pricing policies stipulated in the product agreements were consistent with the pricing policies as discussed above. As advised by the Management, the service scope provided by Ant Financial Group with respect to the travel insurance products is different from the service scope provided by other third parties independent from the Company, therefore, there is no product agreement entered into between the Group and independent third parties which is comparable to the product agreements between the Group and Ant Financial Group with respect to the travel insurance products. We have also reviewed sample agreements entered into by the Group and other third parties independent from the Group who provided similar online platform services to the Group with respect to the sales of health insurance products and e-commerce related insurance products and noted that the rates of platform service fees charged by such independent third parties were similar than the rates charged by Ant Financial Group.

Please refer to the section headed "3.4 The annual caps" in this letter for more information of the fixed rates adopted between the cooperation of the Group and Ant Financial Group. Based on the above, we are of the view that the the terms of the New Online Platform Cooperation Framework Agreement are on normal commercial terms, fair and reasonable so far as the Company and the Ant Financial Independent Shareholders are concerned.

3.3 Reasons for and benefits of entering into the New Online Platform Cooperation Framework Agreement

As disclosed in the Letter and confirmed by the Management, the Group is one of the only four companies with an online insurance licence in China. It is necessary as part of the Group's online business expansion to utilise various online platforms to reach a wider customer base. As stated in the Letter, the cooperation with Ant Financial Group under the New Online Platform Cooperation Framework Agreement will continue to be beneficial to the Group in light of Ant Financial Group's leading market position in online platforms in the PRC market as well as its close cooperation with Alibaba and other well-known online platforms. Moreover, the premium received by the Group pursuant to the Online Platform Cooperation Framework Agreement entered into between the Company and Ant Financial increased from the year ended December 31, 2016 to 2018, and the premium received by the Group pursuant to the Online Platform Cooperation Framework Agreement for the nine months ended September 30, 2019 already exceeded the premium received the year ended December 31, 2018. As such, we are of the view that the entering into of the New Online Platform Cooperation Framework Agreement will allow the continuous business cooperation between the Group and Ant Financial Group and provide a stable platform for the distribution of the Group's online insurance products, therefore is in the interest of the Company and the Shareholders as a whole.

The Directors consider Ant Financial an important ecosystem partner and the customer reach offered by Ant Financial is wider as compared to other online platform service providers because of its leading position in the online financial services industry in the PRC as well as its close cooperation with Alibaba and other well-known online platforms. Nevertheless, before entering into any agreement under the New Online Platform Cooperation Framework Agreement, the Group will assess the needs and will only enter into these transactions when the agreement is in the best interests of the Shareholders as a whole.

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3.4 The annual caps

3.4.1 Historical transaction amount and the 2020 Online Platforms Annual Cap

The table below sets out the historical platform service fee paid to Ant Financial Group by the Group and corresponding premium received by the Group pursuant to the Online Platform Cooperation Framework Agreement for each of the three financial years ended December 31, 2018 and the nine months ended September 30, 2019 (the "Review Period"):

									For the nine months
		For the year ended December 31,			ended September 30,
	2016			2017			2018		2019

Product	Platform			Platform			Platform		Platform
category	service fee	Premium	service fee	Premium	service fee	Premium	service fee	Premium
	in RMB	in RMB	in RMB	in RMB	in RMB	in RMB	in RMB	in RMB
	million	million	million	million	million	million	million	million
Health insurance	1.9	33.9		44.5	365.3		178.0	958.8	244.4	1,605.2
Travel insurance	3.2	258.8		8.5	377.5		5.7	256.2	10.3	302.9
E-commerce
related
insurance	432.6	1,640.1		374.0	1,554.7		303.9	1,574.6	464.9	2,403.4
Total/ overall	437.7	1,932.7		427.0	2,297.5		487.6	2,789.6	719.6	4,311.5

Note: The above table is for illustration purpose only and all figures in the above table have been rounded up to one decimal place. As advised by the Management, as the above information was provided by Ant Financial Group to the Group for settlement purpose, some premium and platform service fees for different categories of insurance policies sold through one online platform may be provided to the Group as a package and hence the Group may not be able to have an exact separation of premium and platform service fees for each category of insurance policies sold in this case. For the avoidance of doubt, amounts of premium shown in the above table represented the total premium pursuant to the product agreements entered for the year/period but not the actual premium received and the platform service fee represented the actual fees paid by the Group to Ant Financial Group based on the actual premium received for the period/year.

We have discussed with the Management and noted that during the Review Period, there were a total of three categories of insurance products sold by the Group through the Online Platforms, namely health insurance, travel insurance and e-commerce related insurance.

We have reviewed the management schedule for each of the years ended December 31, 2016,

2017 and 2018 and the nine months ended September 30, 2019 stating the premium received by the Group pursuant to the Online Platform Cooperation Framework Agreement and the corresponding platform service fees paid to Ant Financial Group for each of the aforementioned categories. As shown in the schedule, the Group commenced the sales of e-commerce related insurance products through the Online Platforms before 2016, while it only started to receive premium and pay the platform service fees for the health insurance products and travel insurance products since the second to third quarter of 2016.

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Platform service fees

The platform service fees paid by the Group to Ant Financial Group recorded a slight decrease by approximately 2.4% from approximately RMB437.7 million for the year ended December 31, 2016 to approximately RMB427.0 million for the year ended December 31, 2017. Such slight decrease was mainly due to the decrease in platform service fees paid for the e-commerce related insurance policies as a combined effect of the decrease in premiums received from sales of insurance policies as well as the Average Platform Service Rate (representing the simple average of total platform service fee paid divided by the total premium received under the respective category of products) as discussed below in the paragraph headed "Platform service rate", which was partially offset by the increase in platform service fee paid for health insurance policies and travel insurance policies as a result of the substantial increase of premiums received by the Group from the sales of such insurance policies.

The platform service fee paid to Ant Financial Group by the Group increased by approximately 14.2% from approximately RMB427.0 million for the year ended December 31, 2017 to approximately RMB487.6 million for the year ended December 31, 2018. Such increase was mainly due to the significant increase of platform service fee paid for the sales of health insurance policies due to the increase in both premiums received as well as the Average Platform Service Rate as discussed below.

The platform service fee paid to Ant Financial Group by the Group is projected to be approximately RMB959.5 million for the annualised amount for year ending December 31, 2019 based on the actual amount of approximately RMB719.6 million for nine months ended September 30, 2019, which represents an increase by approximately 96.8% from the year ended December 31, 2018. Such increase was mainly due to (i) the expanded customer base, particularly for health insurance related products after the introduction of settling premium by instalments in mid 2019 as evidenced by the sharp increase in premium starting from June 2019; and (ii) the expected increase of premium to be received by the Group.

Premium

We note that the premium received by the Group increased from approximately RMB1,932.7 million for the year ended December 31, 2016 to approximately RMB2,297.5 million for the year ended December 31, 2017, representing an year-on-year increase of approximately 18.9%. As advised by the Management, such increase was mainly attributable to the notable increase of premium received from the sales of health insurance policies after the launch of new products, and partially offset by the decrease of premium received from the sales of e-commerce related insurance policies as a result of switch of sales focus to the health insurance products.

The premium received by the Group further increased to RMB2,789.6 million for the year ended December 31, 2018, indicating an increase of approximately 21.4% as compared to the previous year. The increase was mainly led by the continuous growth of the premium received from the sales of health insurance policies since the previous year, and partially offset by the decrease of premium received from sales of travel insurance policies due to the change of marketing methods of certain online platforms through which the Group sold such products.

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The premium to be received by the Group is projected to be approximately RMB5,748.7 million for year ending December 31, 2019 based on the actual amount of approximately RMB4,311.5 million for nine months ended September 30, 2019, which represents an increase of approximately 106.1% from the year ended December 31, 2018. Such increase was mainly due to (i) the increase in premium from health related insurance mainly due to premium generated from the core products of the health ecosystem, namely Personal Clinic Policy (*尊享e生) and Healthcare Ecosystem (*好醫保) as a result of the increasing awareness of the health issues which led to a strong demand for family health insurance products; and (ii) the increase in premium from e-commerce related insurance as a result of the increase popularity of mobile internet and the penetration rate of online shopping by users.

Platform service rate

As illustrated in the section headed "3. The New Online Platform Cooperation Framework Agreement - 3.2 Pricing policies" in this letter, fixed rate of the total premium received by the Group through Ant Finance Group were adopted in calculating the platform service fees for the health insurance products and travel insurance products, while the platform service fees in relation to e-commerce related insurance products is calculated by multiplying the total premium of the insurance by the surplus of settlement limit after deducting the actual maturity loss ratio (賠付率) times the fixed rate. As advised by the Management, the fixed rate, settlement limit and actual maturity loss rate may vary from product to product.

As further advised by the Management, the Group and Ant Financial Group are in the progress of expanding the customer base while relevant expenses/fees may increase. The Average Platform Service Rate for the health insurance products experienced an upward trend from the year ended December 31, 2016 to 2018. As advised by the Management, such upward trend was mainly due to

the launch of new product in 2017 which bore a higher platform service rate as compared to the then existing products; and (ii) the sales of another new product launched in the end of 2017 which bore a higher platform service rate. The Average Platform Service Rate for the health insurance products decreased slightly for the nine months ended September 30, 2019 from the year ended December 31, 2018 mainly because the total premium pursuant to the product agreements entered into during the nine months ended September 30, 2019 increased as a result of the introduction of settling premium by way of instalments whereas such increase in premium because of the instalments would not materially affect the actual platform service fee paid by the Group to Ant Financial Group which was based on the actual premiums received by the Group in the period.

The Average Platform Service Rate for the travel insurance policies increased from the year ended December 31, 2016 to the year ended December 31, 2017, and remained relatively stable for the year ended December 31, 2018 and further increased to the nine months ended September 30, 2019. As confirmed by the management of the Company, the fluctuations of the Average Platform Service Rate were mainly due to the mix of the travel insurances purchased by the insurers.

With respect to the e-commerce related insurance policies, its Average Platform Service Rate recorded a decreasing trend during the Review Period. As advised by the Management, such downward trend of the Average Platform Service Rate was mainly attributable to the increase of

* The translations are for reference only and should not be regarded as the official translation.

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maturity loss ratio during the Review Period, which was brought by the expansion of the Group's sales channel which brought some customers who might be more likely to claim for repayment of certain insurance policies. Nevertheless, the Group may further optimise its risk management models based on its larger customer base so as to lower the maturity loss ratio subsequently.

3.4.2 Basis and assessment of the 2020 Online Platforms Annual Cap

Set out below is the 2020 Online Platforms Annual Cap with the corresponding estimation basis for the year ending December 31, 2020:

	Premium	Platform service fee
	in RMB million	in RMB million
Annual Cap		2,010.7
Health insurance	6,537.5	1,176.8
Travel insurance	390.8	13.7
E-commerce related insurance	4,086.3	820.2
Total/ overall	11,014.6	2,010.7

As advised by the Management, the 2020 Online Platforms Annual Cap was determined by the Board having taken into consideration of (i) the expansion of insurance products under the cooperation between the Company and Ant Financial and/or its associates, through which the Company can sell its insurance products to end users and at the same time better serve the insurance needs of ecological Internet users based on mutual cooperation, thus improving the user experience of the platforms; (ii) the tremendous development of online platforms in the PRC in recent years, in particular, the rapid growth of the Internet property and casualty insurance business, which has given rise to the increase in the gross written premiums received by the Company from its provision of insurance products through the online platforms of Ant Financial Group pursuant to the Online Platform Cooperation Framework Agreement from approximately RMB2.8 billion in 2018 to an estimated amount of approximately RMB7.1 billion in 2019, representing a year-on-year increase of approximately 153.6%, and the Directors' expectation that this growth trend will continue into 2020;

the increase sales volume in the five exisiting online platforms established by Ant Financial and/or its associates through which the Company can sell its insurance products to end users in 2019; and (iv) the remarkable increase in gross written premium of the Group's lifestyle consumption ecosystem business in the first half of 2019 as a result of the Company's enhanced cooperation with Ant Financial Group to actively explore product innovation and update. Based on the insurance technology and Internet ecological service capabilities accumulated by the Company, the Company recorded a rapid growth rate in the sales of the Internet insurance products through Ant Financial and its partners. As such, it is expected that the platform service fees to be paid by the Company to Ant Financial and/or its associates for the year ending December 31, 2020 will be higher than the annual cap for the year ended December 31, 2019. Accordingly, the Board proposes to increase the annual cap from approximately RMB1,176.8 million for the year ending December 31, 2019 to approximately RMB2,010.7 million for the year ending December 31, 2020.

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The 2020 Online Platforms Annual Cap has been determined by the Board based on (i) the total platform service fees that has been paid to Ant Financial and/or its associates as of the Latest Practicable Date, (ii) the platform service fees expected to be payable to Ant Financial and/or its associates for the year ending December 31, 2020; and (iii) the Company's estimated market demand for the year ending December 31, 2020, taking into account (a) the rapid growth rate the Company has recorded in the sales of the Internet insurance products through Ant Financial and its partners in 2019, and (b) the rise of awareness of insurance amongst the general public in the PRC resulting from the increase of their disposal income level and the upgrade of their consumption level.

Premium

It is noted that the Company expects to receive premiums from the sales of health insurance, travel insurance and e-commerce related insurance products of approximately RMB6,537.5 million, RMB390.8 million and RMB4,086.3 million for the year ending December 31, 2020, representing a year-on-year growth of approximately 2.0 times and 27.5% for health insurance and e-commerce related insurance products, respectively and a year-on-year decline of approximately 3.2% for travel insurance as compared to the annualised amount for the year ending December 31, 2019 through the Online Platforms.

We were advised by the Management that the Group, together with Ant Financial Group, continue to explore more insurance products and relevant services to solve the customers' problems. The Group has expanded its sales volume with the five existing online platforms operated by Ant Financial Group and/or its business partners in 2019. Such online platforms includes (i) an online third party payment platform ; (ii) two online shopping platform targeting buyers globally; (iii) an online trading platforms for business; and (iv) an online air ticketing platform. It is expected that the Group could benefit from the large amounts of end-users from these online platforms through the launch of new insurance products, especially health insurance products and e-commerce related insurance products.

Furthermore, as advised by the Management, the Group continued to provide insurance products covering risks associated with product return, product quality, logistics, post-sale services and merchant security deposits for main stream e-commerce platforms in China, such as customer finance insurance Fang Xin Tao* (放心淘) with Taobao and Furniture Cargo Policy* (天貓家裝貨運險) with Tmall. Through the cooperation with Ant Financial Group in several business fields, the Group is expected to continue to (i) explore innovative insurance products and user experiences for the customers of the lifestyle consumption related business; and (ii) proactively explore upgrades and innovation under the e-commerce scenarios by enhancing cooperation with an aim to identify any unsolved deficiency and provide comprehensive insurance solutions in order to increase the premium received by the Group.

We were also advised that the introduction of settling premium by instalments for health insurance related products has successfully attracted more customers. It is expected that (i) the expansion of insurance products under the cooperation between the Company and Ant Financial and/or its associates; (ii) launch of new insurance products; and (iii) the impact of settling premium by instalment for health insurance related products as evidenced by the sharp increase in premium starting from June 2019 will help generate additional premium to the Group.

* The translations are for reference only and should not be regarded as the official translation.

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With respect to the travel insurance products, since the travel insurance products are not the core products under discussion with the new business partners, the Directors have been rather conservative on estimating the premium to be received by the sales of travel insurance policies as compared to the annualised premium for the year ending December 31, 2019.

We have also reviewed the management schedule with respect to the premium received by the Group and corresponding platform service fee paid to Ant Finance Group by the Group pursuant to the Online Platform Cooperation Framework Agreement for the nine months ended September 30, 2019 provided by the Group. We note that the Group recorded an increase in premium received from the sales of insurance products through the online platforms of approximately 1.3 times as compared to that for the nine months ended September 30, 2018, which also indicates an increasing trend of the Group's business and better cooperation with Ant Financial Group.

With respect to the health and related insurance market, according to the Statistical Communique of the People's Republic of China on the 2018 National Economic and Social Development (2018年國民經濟和社會發展統計公報) (the "Statistical Communique") published by the National Bureau of Statistics, the annual premium of the insurance industry has increased by approximately 3.9% to around RMB3,801.7 billion whereas the annual premium of the health and casualty insurance has a significant increase of approximately 23.3% to around RMB652.4 billion for the year ended December 31, 2018. Therefore, it is not unreasonable to expect that the health insurance market still has a potential for a significant expansion in the coming years.

In relation to the travel insurance market, the Statistical Communique also set out that the number of outbound travellers in 2018 has increased by approximately 13.5% from around 142.7 million for the year ended December 31, 2017 to around 162.0 million for the year ended December 31, 2018. Among the outbound travellers, the non-business travellers have increased around 14.1% from approximately 135.8 million for the year ended December 31, 2017 to approximately 155.0 million for the year ended December 31, 2018, consequently, the demand for travel insurance may be boosted as a result of the increase in number of outbound travellers.

For the e-commerce related insurance market, the online retail sales in 2018 has a significant rise of approximately 23.9%, from RMB7175.1 billion for the year ended December 31, 2017 to RMB9,006.5 billion for the year ended December 31, 2018 according to the Statistical Communique. Hence, the demand of value-added service such as insurance with transportation coverage and contents coverage is likely to increase along with the thrive of the e-commerce market.

According to the 2018 Internet Property Insurance Market Report issued by Association of China Insurance Industry (中國保險行業協會) as provided by the Company, the online non-auto insurance business has maintained a steady and rapid growth, and the business ratio continues to rise, which is higher than the overall non-auto insurance business. In 2018, the accumulated online non-auto insurance premium income was approximately RMB32.7 billion, representing a growth rate of approximately 75.3% over the same period, and still maintained a high growth rate. The rapid growth of online non-auto insurance provides a more diversified platform and demands for the development of online insurance, promotes the innovation of insurance products and the growth of the business. On the other hand, with the increase of the disposable income level of the citizens, the consumption level has upgraded and the awareness on insurance has risen, making insurance services gradually become essential, popular products such as return freight insurance, high-end medical insurance, aviation

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accident insurance, personal accident insurance, credit and guarantee insurance have further cultivated and rise the insurance awareness of the public. Moreover, the further development of the industry has provided more space for the online non-auto insurance innovation and diversified product line.

We are of the view that the estimation of respective premium amount is justifiable.

Platform service rate

After reviewing the calculation of the 2020 Online Platforms Annual Cap as provided by the Management, we noted that the Average Platform Service Rate for each category of insurance products under the New Online Platform Cooperation Framework Agreement for the year ending December 31, 2020 is estimated with reference to (i) latest fixed rates of corresponding insurance products as discussed above; or (ii) historical platform service rates.

In particular, the Average Platform Service Rate for the health insurance products for the year ending December 31, 2020 of approximately 18.0% is estimated with reference to the current fixed rate of various insurance products offered, which has also taken into account the impact of the introduction of settling premium by way of instalments which reduced the overall Average Platform Service Rate as detailed in paragraph headed "3.4.1 Historical transaction amount and the 2020 Online Platforms Annual Caps - Platform service rate" above.

The fixed rate for the travel insurance products is expected to be relatively stable at approximately 3.5% for the year ending December 31, 2020 which is referenced to that for the nine months ended September 30, 2019.

With respect to the Average Platform Service Rate for the e-commerce related insurance products which should be calculated based on the settlement limit, actual maturity loss ratio and fixed rate for each product, the Management estimates the Average Platform Service Rate for the year ending December 31, 2020 will only have a slight increase to approximately 20.1% as both the Group and Ant Financial Group are striving to lower the actual maturity loss ratio by carefully selecting the target customers in the future as well as the Group will further optimise its risk management models based on its larger customer base.

We are of the view that the estimation of respective Average Platform Service Rate is justifiable.

Annual cap - aggregate platform service fee

As illustrated above, the 2020 Online Platforms Annual Cap, being the aggregate platform service fee for the year ending December 31, 2020, was estimated based on the premium to be received by the Group and the corresponding Average Platform Service Rate.

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The Management advised that the 2020 Online Platforms Annual Cap is closely linked to the online insurance products to be sold by the Group using the online platforms operated by Ant Financial Group and/or its associates to the end users, which in turn represent the sales target of the Group's business. We would like to emphasise that, premium to be received by the Group pursuant to the New Online Platform Cooperation Framework Agreement is a stable and recurring source of income of the Group, hence we are of the view that it is fair and reasonable to determine the 2020 Online Platforms Annual Cap according to the Group's sales target, so as not to limit the development of the Group's business in the event that it is able to meet its sales target.

Moreover, given the Revised Ant Financial Online Platform Annual Cap has to be revised to the Further Revised Ant Financial Online Platform Annual Cap because it is expected that the Revised Ant Financial Online Platform Annual Cap will be insufficient, we are of the view that the 2020 Online Platforms Annual Cap should provide certain buffer to the Group in order to save resources for revising it.

Based on the aforesaid, we consider the bases of determination of the 2020 Online Platforms Annual Cap under the New Online Platform Cooperation Framework Agreement to be fair and reasonable. In addition, having considered that (i) the provision of online insurance products under the New Online Platform Cooperation Framework Agreement falls within the ordinary course of business of the Group; and (ii) the expected increase in platform service fee to be paid to Ant Financial Group is resulted from the expected increase of premium to be received by the Group, which contributes to the Group's revenue inflow, we consider that the 2020 Online Platforms Annual Cap is acceptable.

The Further Revised Ant Financial Online Platform Annual Cap and the 2020 Online Platforms Annual Cap are determined by the Management based on assumptions, which include but are not limited to the current estimation of the amount of premiums and market conditions. Accordingly, we express no opinion as to how closely the actual amounts contemplated under the continuing connected transactions in comparison to the Further Revised Ant Financial Online Platform Annual Cap and the 2020 Online Platforms Annual Cap.

PRINCIPAL FACTORS AND REASONS CONSIDERED IN RELATION TO THE AUTO CO-INSURANCE COOPERATION AGREEMENT AND THE AUTO ANNUAL CAPS

In arriving at our recommendation, we have considered the following principal factors and reasons:

1. Background of Ping An P&C

Ping An P&C is a subsidiary of Ping An Insurance, which is the Company's substantial shareholder. The business scope of Ping An P&C covers all statutory property and casualty business and international reinsurance business including insurance for automobile, commercial properties, construction, liability, cargo, short-term accident and health.

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2. Background of the Auto Co-insurance Cooperation Agreements

2.1 Principal terms of the Auto Co-insurance Cooperation Agreements

As advised by the Management, pursuant to the Auto Co-insurance Cooperation Agreements, the premiums, claims and all fees and expenses incurred in the provision of auto co-insurance are to be shared by the Group and Ping An P&C in 50%:50% proportion, respectively. The term of the Auto Co-insurance Cooperation Agreements will be effective from January 1, 2020 and expire on December 31, 2022. The Company will enter into agreements for the provision of auto insurance services and Ping An P&C will be responsible for operating the duties (including insuring and making payments pursuant to claims) under such auto insurance agreements. Payments under such auto insurance agreements will be made to the Company which will then be settled with Ping An P&C.

As advised by the Management, the premiums sharing proportion was determined and agreed between the Company and Ping An P&C after an arm's length negotiation, against the backdrop of successful collaboration between the two parties since the beginning of 2015. The parties reached an agreement to 50:50 premium sharing ratio due to the synergy that can be created out of the cooperation of both parties as the Company can successfully sell and market insurance products through various third parties and through its own proprietary platforms. This also represents an affirmation by both parties of the results of the existing cooperation, indicating the determination and confidence of both parties to further deepen the cooperation and marking a higher level of cooperation and business exploration between the parties in the area of auto insurance. We have reviewed the terms of the Existing Ping An Auto Co-insurance Agreement and the Auto Co-insurance Cooperation Agreements. Save for the payments of premium under such auto insurance agreements will be made to the Company, we did not note any abnormal term or any material difference between the terms of the Existing Ping An Auto Co-insurance Agreement and the terms of the Auto Co-insurance Cooperation Agreements.

The auto insurance premiums are heavily regulated in the PRC and the premium charged under the Auto Co-insurance Agreements are determined at a market rate and approved by the CBIRC. They are determined after careful examination and verification by the business management committee of the department. Members of the committee conduct market analysis and various other procedures to determine all aspects of the product including the pricing. These prices must conform with the terms and regulations set by the Company and be approved by other relevant departments such as the actuary department and the operations management centre. The premium and claim payment sharing ratio between the Company and Ping An Group is agreed by both parties after arm's length negotiations having regard to the fact that Ping An Group will be responsible for the daily operations of the agreement including receiving reports of claims, investigating the claims and maintaining customer records. We have obtained samples of the agreements for the provision of auto insurance services and such price were in line with the said pricing policies.

2.2 Reasons for and benefits of entering into the Auto Co-insurance Cooperation Agreements

As disclosed in the Letter, Ping An Group is one of the largest insurance providers in the PRC. Property and casualty insurance has been the foundation of its business with steady growth since its inception. The entering into of the Auto Co-insurance Cooperation Agreements which is a continuation of the existing cooperation between Ping An P&C and the Company in the provision of

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auto co-insurance to the public under the Existing Ping An Auto Co-insurance Agreement, represents an affirmation by both parties of the results of the existing cooperation, indicating the determination and confidence of both parties to further deepen the cooperation and marking a higher level of cooperation and business exploration between the parties in the area of auto insurance. In addition, the Auto Co-insurance Cooperation Agreements allow the Company not only to share the risk of claims with Ping An Group but also to reach a wider base of customers. Moreover, the Directors believes that Ping An Group's online auto co-insurance network will provide the Company with a number of opportunities to conduct a variety of business explorations.

As discussed with the Management, we note that the auto insurance products offered by the Group were all under the Auto Co-insurance Cooperation Agreements and the Group does not have any other co-insurance cooperation arrangement with other third parties independent from the Company. The Group also does not offer any auto insurance services on its own. The payments of premium under such auto insurance agreements will be made to the Company which will then be settled with Ping An P&C. The Management are of the view that the Company has sufficient resources on handling the administrative work for the receipt of premium and experience in monitoring the compliance of relevant regulatory requirement. The Company would benefit from this arrangement in terms of cashflow management since the premium will be made to the Company directly by taking lead for the whole transaction. The total premiums the Group received under the Auto Co-insurance Cooperation Agreements for each of the two years ended December 31, 2017 and 2018 and nine months ended September 30, 2019, were approximately RMB77.9 million, RMB1,146.0 million and RMB964.0 million, respectively. Therefore, we consider that the co-insurance cooperation arrangement under the Auto Co-insurance Cooperation Agreements provides a recurring and rapidly growing source of revenue to the Group, which is beneficial to the Group's business.

As discussed with the Management, we understand that for the auto co-insurance services under the Auto Co-insurance Cooperation Agreements, Ping An P&C is primarily responsible for operating the duties under the agreement, such as underwriting and issuance of insurance policies, keeping insurance policies and settlement of insurance claims, whereas the Group is mainly responsible for the sales and distribution and provision of the sales channels, such as through its own proprietary platforms and cooperate with the Group's business partners who can provide their customers access to the Group's online insurance products. As discussed below, the transformation of the means and habits of auto insurance from offline to online and the simplification of insuring processes for automobiles create market opportunities for both Ping An P&C and the Group.

Particularly, having considered that the Group is the only few online Insuretech company, i.e. use of technology innovations designed to achieve savings and efficiency from the traditional insurance industry model, in the PRC to provide online auto insurance, whereas Ping An P&C, being a subsidiary of Ping An Insurance, is a solid and established insurance company which the insured would be confident with, the Directors consider, and we concur that the business cooperation under the Auto Co-insurance Cooperation Agreements are mutually beneficial to Ping An P&C and the Group. In addition, the Group has powerful internet technologies and extensive connections to its ecosystem partners' platforms, while Ping An P&C will be able to reach such large extent of potential customers through online platforms under the cooperation with the Group, and hence, may be able to capture the potential growth in the Insuretech industry.

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LETTER FROM THE INDEPENDENT FINANCIAL ADVISER

As advised by the Management, the auto insurance is only one of the five ecosystems of the Company, and the others include lifestyle consumption, consumer finance, health and travel. While the gross written premium from auto insurance has increased significantly from the year ended December 31, 2017 to the year ended December 31, 2018 as discussed further in the section headed "3. The annual caps" below, the Management confirmed there has also been increases in the performance of the other ecosystems. The auto co-insurance collaboration follows a unique business model that requires the two parties to perform two distinct roles. The Company performs the front-line sales function while Ping An P&C performs the back-end operation function. The Directors confirm that the Company maintains its independence by having its network of sales platforms from its various ecosystem partners including Alipay (支付寶), Xiaomi (小米) and WeChat payment (微信支付) and having its own proprietary platforms such as the Company's official website, the Company's own APP and Wechat platform as sales channels for the auto insurance products. While there are other players in the market that could provide the back-end operation function and there are other business models that the Company could implement to achieve and maintain the level of revenue in the future, the collaboration between the Company and Ping An P&C is one steeped in confidence and stability. The continuous collaboration between the parties to the Auto Co-insurance Cooperation Agreements further demonstrates Ping An P&C's confidence in its business relations with the Company and its enhanced effort to continue business collaboration with the Company.

As further disclosed in the Letter, the Company also believes that its collaboration with Ping An P&C is mutually beneficial. Ping An P&C benefits from the Company's technological expertise such as using big data analytics in price determination, personalised product design based on the Company's proprietary technologies and its network of platforms from its ecosystem partners as well as its own proprietary platforms to provide the front-line sales channels to Ping An P&C, while the Company benefits from Ping An P&C's brand name in the PRC market and its expertise in the operation of the provision of auto insurance products. The Company and Ping An P&C are both aligned to increase the total premiums received for the products to increase the revenue income of both parties.

Based on the aforesaid, the Directors believe that the collaboration with Ping An P&C does not raise a reliance issue on Ping An Group. Notwithstanding the expected increase in the amount of the Group's gross written premium under the Auto Co-insurance Cooperation Agreements and regardless whether the collaboration with Ping An P&C raises a reliance issue on Ping An Group, considering that the entering into the Auto Co-insurance Cooperation Agreements with Ping An P&C allow the Group to (i) offer auto co-insurance services so as to reach a wider base of customers and expand its product offerings and revenue source; and (ii) achieve higher revenue by a proportion of 50% of premiums to be received, we are of the opinion that the terms of the Auto Co-insurance Cooperation Agreements are on normal commercial terms, fair and reasonable so far as the Company and the Auto Co-insurance Independent Shareholders are concerned and are in the interest of the Company and the Shareholders as a whole.

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LETTER FROM THE INDEPENDENT FINANCIAL ADVISER

3 The annual caps

3.1 Historical transaction amount and the Auto Annual Caps

The table below sets out the historical amount of premiums shared by the Group under the Auto Co-insurance Cooperation Agreements for years ended December 31, 2017, December 31, 2018 and nine months ended September 30, 2019 and the annualised amount for the year ending December 31, 2019:

For the year ended	For the year ended	For the nine months	For the year ending
December 31,	December 31,	ended September 30,	December 31,
2017	2018	2019	2019 (Note)
(Approximate)	(Approximate)	(Approximate)	(Approximate)
RMB77.9 million	RMB1,146.0 million	RMB964.0 million	RMB1,285.4 million

Note: Annualised based on the amount for the nine months ended September 30, 2019.

We noted an upward trend of the historical amount of premiums shared by the Group under the Existing Ping An Auto Co-insurance Cooperation Agreement during the years ended December 31, 2017, December 31, 2018 and the annualised amount for the year ending December 31, 2019 based on the amount for the nine months ended September 30, 2019. The amount of premiums received was approximately RMB77.9 million for the year ended December 31, 2017, and increased by approximately 13.7 times to approximately RMB1,146.0 million for the year ended December 31, 2018. As advised by the Management, such increase was mainly attributable to (i) the increase in number of regions that the Group can offer the auto co-insurance products as approved by CIRC as detailed below; (ii) the increase in number of the insured during the year ended December 31, 2018; and (iii) the upgrade and optimisation of the Group's online purchase system for the commercial auto insurance products since mid-2017, such as simplification of the overall auto insurance procedures and process, which lead to an increase in insure conversion rate, which was derived by dividing the number of end-users who purchased the insurance products by the number of end-users who clicked into the Group's product purchase front page/commenced the process of online purchase by over 2.4 times from approximately 2.6% for the year ended December 31, 2017 to approximately 8.8% for the year ended December 31, 2018, which represented the successful rate of placing the auto insurance of an individual who browsed the online purchase platform.

The premiums shared by the Group for the nine months ended September 30, 2019 amounted to approximately RMB964.0 million with an annualised amount of approximately RMB 1,285.4 million for the year ending December 31, 2019, representing an increase of approximately 12.2% as compared to approximately RMB1,146.0 million for the year ended December 31, 2018. Such increase was mainly due to the steady development in respect of the auto insurance business and optimised the underwriting quality of the existing business through refined operation to keep the loss ratio under control.

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LETTER FROM THE INDEPENDENT FINANCIAL ADVISER

The annual cap for the year ending December 31, 2019 under the Existing Ping An Auto Co-insurance Cooperation Agreement was RMB6,000 million, while the annualised premiums of the Group for the year ending December 31, 2019 is approximately RMB1,285.4 million. According to the Management, such estimated shortfall was mainly due to (i) the unexpected slump on the automobile market in the PRC from the second half of 2018 which was unforeseen at the time of the revision of the annual cap for the year ending December 31, 2019 under the Existing Ping An Auto Co-insurance Cooperation Agreement in February 2018; and (ii) the cease of business relationship with some platforms such as Changan (長安汽車) and BYD (比亞迪汽車) since April 2019 which was mainly due to the relatively higher cost for the insurance for electric cars.

According to the China Association of Automobile Manufacturers (the "CAAM"), the auto market in the PRC dropped by approximately 2.8% on a year-on-year basis in 2018, being the first fall since 1990 and missed the previous sales growth expectation. CAAM citied that such decrease was mainly due to (i) slower economic growth in China led to the low consumer sentiment and the drop of vehicle sales; and (ii) a tough pollution crackdown which requires cars to have better filtering systems for particulate matters and for trapping exhaust gases and in turn, affect the sales of vehicle in particular those vehicle does not meet emission standard and the demand of the auto insurance.

As discussed with the Management, we note that the Group launched its auto co-insurance products by batch since 2015 after obtaining relevant approvals from CIRC. The table below sets forth the timing of launch of the Group's auto co-insurance products in respective regions of the PRC (other than Hong Kong, Macau and Taiwan)

Launch date	Regions covered
Fourth quarter of 2015	Six regions ("Regions A"), including:
	Heilongjiang, Shandong, Guangxi, Chongqing, Shaanxi, Qingdao
Second quarter to third	12 regions ("Regions B"), including:
quarter of 2017
	Guangdong, Shenzhen, Jiangxi, Xiamen, Henan, Anhui, Jiangsu,
	Zhejiang, Hebei, Tianjin, Beijing, Shanghai
Third quarter to fourth	13 regions ("Regions C"), including:
quarter of 2017
	Fujian, Hainan, Hubei, Hunan, Jilin, Liaoning, Inner Mongolia,
	Ningbo, Qinghai, Shanxi, Sichuan, Tibet, Yunnan
First and second	Five regions ("Regions D"), including:
quarter of 2018
	Guizhou, Dalian, Gansu, Ningxia, Xinjiang

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LETTER FROM THE INDEPENDENT FINANCIAL ADVISER

3.2 Basis and assessment of the Auto Annual Caps

Set out below are the Auto Annual Caps for each of the three years ending December 31, 2022:

	For the year ending	For the year ending	For the year ending
	December 31, 2020	December 31, 2021	December 31, 2022
	(RMB' million)	(RMB' million)	(RMB' million)
Auto Annual Caps	1,644.5	2,137.9	2,779.2

The Auto Annual Caps amount to approximately RMB1,644.5 million, RMB2,137.9 million and RMB2,779.2 million for the three years ending December 31, 2022, which represented growth rate of approximately 30.0% as compared to the preceding year. In estimating the Auto Annual Caps for the three years ending December 31, 2022, the Group has taken into account of (i) the historical growth of actual insured premium of approximately 13.7 times from the year ended December 31, 2017 to the year ended December 31, 2018 and approximately 13.3% growth in actual premiums received for nine months ended September 30, 2019 as compared to that of nine months ended September 30, 2018; (ii) the potential growth in all regions in the PRC; and (iii) the potential growth of the scale of auto insurance premium which is associated with the expectation that CBIRC will promulgate changes on how auto insurance premium should be calculated that is expected to be implemented in 2020.

The average premiums shared by the Group per region increased by approximately 12.2% from approximately RMB31.8 million for the year ended December 31, 2018 to approximately RMB35.7 million for the year ending December 31, 2019 based on the annualised premium of approximately RMB1,285.4 million as all Region A, B, C and D also recorded growth for the nine months ended September 30, 2019 as compared to that for the nine months ended September 30, 2018. As such, we are of the view that the premiums shared by the Group recorded a steady growth from 2018 to 2019.

In addition, as stated in the Prospectus, according to the research and forecasts of the industry consultant (the "Industry Consultant") engaged by the Group, China has become the largest auto market in the world. According to the information stated on the website of 中國公安部交通管理局 (Traffic Management Bureau of The Ministry of Public Securities of the PRC), the total number of automobiles under registration in the PRC is approximately 340 million as at the end of June 2019 and there are approximately 12.4 million new automobiles registered during the first half of 2019. According to the Industry Consultant, it is expected that the number of outstanding vehicles in China will grow at a compound annual growth rate ("CAGR") of 10.6% from 2016 to 2021, reaching 321 million by 2021. As stated in the Prospectus, according to the Industry Consultant, the size of the auto related Insuretech market amounted to RMB124 billion in 2016, and is expected to grow to RMB412 billion in 2021, representing a CAGR of 27.1%. The percentage of the overall auto insurance market that is addressable by Insuretech is expected to increase from 18% in 2016 to 35% in 2021, according to the Industry Consultant.

The implied total amount of premium income to be generated under the Auto Co-insurance Cooperation Agreements for the years ending December 31, 2020 and 2021, which amounts to approximately RMB3.2 billion and RMB4.3 billion (i.e. the combined income of the Group and Ping An P&C) only account for approximately 3.0% market share of the size of the auto related Insuretech

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LETTER FROM THE INDEPENDENT FINANCIAL ADVISER

market in the PRC in 2020 and 2021 as estimated by the Industry Consultant. The implied total amount of premium income to be generated under the Auto Co-insurance Cooperation Agreements for the year ending December 31, 2022, which amounts to approximately RMB5.6 billion (i.e. the combined income of the Group and Ping An P&C) also accounts for approximately 3.5% market share of the size of the auto related Insuretech market in the PRC in 2022 only as estimated by referencing the size of the auto related Insuretech market in the PRC in 2021 based on the estimation by the Industry Consultant and using the compound annual growth rate of approximately 10.6% from 2016 to 2021. Moreover, considering that, as advised by the Management, the Group is currently the only few online Insuretech companies in the PRC and that the Group is approved to distribute the auto co-insurance products in all 36 regions of the PRC, we consider the Group is well-positioned to seize the growth of the auto related Insuretech industry of the PRC. Based on the aforesaid, we consider the bases and assumptions for determining the Auto Annual Caps (including the growth rate of premiums adopted by the Management) are fair and reasonable and that we do not consider the targeted premium income to be generated by the Group under the Auto Co-insurance Cooperation Agreements for the three years ending December 31, 2022 is overly aggressive.

In estimating the Auto Annual Caps, the Group has also taken into account the further reforms to the administration system of the commercial auto insurance premium rates, as well as the gradual decrease in the premiums, there will come a golden era for further developments in internet auto insurance. Since 2017, the Group have commenced business in relation to auto ecosystems, including

commencing the sale of auto insurance in the automotive aftermarket by means of software-as-a-service (SAAS); (ii) creating direct operation channels such as an auto insurance app, a WeChat service account and direct sales mini programs; (iii) enhancing the depth of cooperation with existing auto retail platforms including Guazi (瓜子), Maodou (毛豆), Yixin (易鑫) and Cango (燦穀); and (iv) commencing business with other insurance or auto retail platforms such as WeSure(微保) and TuHu (途虎養車).

Guazi (瓜子) is an online second-hand automobile transaction platform launched in 2015 and covers around 30 provinces in the PRC; Maodou (毛豆) is a business line operated by the owner of Guazi (瓜子) and an online plus offline auto retail platform launched in 2017, focusing on selling and rental of new automobiles and covers more than 30 major cities in the PRC; Yixin Group (易鑫), started in 2014, is an online automobile retail transaction platform in the PRC and mainly provides transaction platform services and auto related financing services. Based on the information provided by the Management, the premiums contributed by these platforms increased by approximately 381.0% from 2017 to 2018 and further by approximately 9.4% from the nine months ended September 30, 2018 to the nine months ended September 30, 2019.

After discussing with the Management and according to our research, we noted WeSure(微保) is an online insurance platform launched by Tencent in the PRC which cover all 36 provinces and allowed its users from WeChat and QQ to purchase insurance products directly, TuHu (途虎養車) is an online automobile maintenance platform launched in 2011 and covers around 31 provinces in the PRC; and Cango (燦穀) is an automotive transaction service platform launched in 2010 for selling and rental of automobiles. We have reviewed the schedule of the auto insurance premiums expected to be generated via such platforms prepared by the Management and noted that the auto insurance premiums to be contributed via such business partners are expected to increase in the coming years considering the Group only commenced business cooperation with them in 2019 and the Group expects to cooperate with these business partners in a long run.

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LETTER FROM THE INDEPENDENT FINANCIAL ADVISER

Moreover, as mentioned in the interim report of the Company for the six months ended June 30, 2019, the Group continued to increase investments in video claim settlement service for auto insurance and integrate in-house and external technologies and data during the first half of 2019, providing users of Baobiao Auto Insurance with online one-to-one instructions to complete loss assessment within 10 minutes at fastest. With the extensive rollout of the 5G technology in the future, its capability of video claim settlement will make communication via video even smoother and facilitate direct communications without delay and labour costs. It is believed that the enhancement of such video claim settlement service will attract more insurers to purchase from the Group.

Considering that, (i) as advised by the Management, the Group is currently the only few online Insuretech companies in the PRC to provide online auto insurance; (ii) the Group is approved to distribute the auto co-insurance products in all 36 regions of the PRC; and (iii) the marketing initiatives of the Group as discussed above; we consider the bases and assumptions for determining the Auto Annual Caps (including the growth rate of premiums adopted by the Management) are fair and reasonable and that we do not consider the targeted premium income to be generated by the Group under the Auto Co-insurance Cooperation Agreements for the three years ending December 31, 2022 are overly aggressive.

Furthermore, CBIRC launched a one-year pilot program in April 2018 to reform the independent pricing of commercial auto insurance in Guangxi, Shanxi and Qinghai provinces. Insurance companies in these locations will have greater flexibility to price commercial auto insurance and offer deeper discounts to high-quality,low-risk customers. The Directors believe that, if such pricing mechanism imposes to other provinces, the pricing reform bring in a solid foundation for the market-oriented pricing mechanism since the Company can offer different premiums based on the risk identification and risk appetites of different customers. Drivers with good driving habits and low accident frequency can enjoy a lower premium which in turn, boosted the customer's willingness to buy additional auto insurance.

The Management advised that the Auto Annual Caps represent the sales targets of the Group's auto co-insurance business during the corresponding periods. We would like to emphasise that, notwithstanding the increasing Auto Annual Caps as compared to the actual historical premiums received, taking into account that the premiums to be received by the Group under the Auto Co-insurance Cooperation Agreements is a stable and recurring source of income of the Group, we are of the view that it is fair and reasonable to set the Auto Annual Caps according to the Group's sales target, so as not to limit the development of the Group's business in the event that it is able to meet its sales target.

Based on the aforesaid, we consider the bases of determine of the Auto Annual Caps under the Auto Co-insurance Cooperation Agreements (including the assumptions and projections of the premiums to be received by the Group) are fair and reasonable. In addition, having considered that

entering into the Auto Co-insurance Cooperation Agreements allows the Group to share a higher portion of premium; (ii) the expected increases in premium from the Group's auto co-insurance business were estimated in accordance with the assumptions made by the Directors which have been made with due care and consideration and made on an objective and a reasonable basis; and (iii) the provision of auto co-insurance products falls within the ordinary course of business of the Group, we consider that the proposed Auto Annual Caps are acceptable.

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LETTER FROM THE INDEPENDENT FINANCIAL ADVISER

The Auto Annual Caps are determined by the Management based on assumptions, among others, current estimation of the amount of premiums and market conditions. Accordingly, we express no opinion as to how closely the actual amounts contemplated under the continuing connected transactions in comparison to the Auto Annual Caps.

ANNUAL REVIEW OF THE CONTINUING CONNECTED TRANSACTIONS

Pursuant to Rules 14A.55 and 14A.56 of the Listing Rules, the continuing connected transactions under the New Online Platform Cooperation Framework Agreement and the Auto Co-insurance Cooperation Agreements and the transations under the the Further Revised Ant Financial Online Platform Annual Cap are subject to the following requirements:

the independent non-executive Directors must confirm in the annual reports and accounts that the continuing connected transactions have been entered into:
- in the ordinary and usual course of business of the Group;
- on normal commercial terms or better; and
- according to the agreement governing them on terms that are fair and reasonable and in the interests of the Company and the Shareholders as a whole;
the Company must engage its auditors to report on the continuing connected transactions for each financial year of the Company and that the Company's auditors must provide a letter to the Board confirming whether anything has come to their attention that causes them to believe that the continuing connected transactions:
- have not been approved by the Board;
- were not, in all material respects, in accordance with the pricing policy of the Group if the transaction involves the provision of goods or services by the Group;
- were not entered into, in all material respects, in accordance with the relevant agreement governing the transactions; and
- have exceeded the annual caps.

In view of the continuing connection transactions will be subject to annual review of the independent non-executive Directors and the auditors of the Company, we are of the view that appropriate measures will be in place to govern the conduct of the continuing connected transactions and safeguard the interests of the Independent Shareholders.

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LETTER FROM THE INDEPENDENT FINANCIAL ADVISER

RECOMMENDATION

Having considered the principal factors and reasons as discussed above, we are of the opinion that the transactions contemplated under (i) the New Online Platform Cooperation Framework Agreement; and (ii) the Auto Co-insurance Cooperation Agreements are entered into in the ordinary and usual course of business of the Group and on normal commercial terms. The terms of (i) the New Online Platform Cooperation Framework Agreement and the 2020 Online Platforms Annual Cap; and

the Auto Co-insurance Cooperation Agreements and the Auto Annual Caps; and the determination of the Further Revised Ant Financial Online Platform Annual Cap are fair and reasonable so far as the Company and the Independent Shareholders are concerned, and are in the interests of the Company and the Shareholders as a whole. Accordingly, we recommend the Independent Shareholders to vote in favour of the ordinary resolution to approve the adoption of the terms of (i) the Further Revised Ant Financial Online Platform Annual Cap; (ii) the New Online Platform Cooperation Framework Agreement and the 2020 Online Platforms Annual Cap; and (iii) the Auto Co-insurance Cooperation Agreements and the Auto Annual Caps at the EGM.

Yours faithfully,

For and on behalf of

Lego Corporate Finance Limited

Kristie Ho

Managing Director

Ms. Kristie Ho is a licensed person registered with the Securities and Futures Commission and a responsible officer of Lego Corporate Finance Limited to carry out Type 6 (advising on corporate finance) regulated activity under the Securities and Futures Ordinance (Chapter 571 of the laws of Hong Kong). She has over 16 years of experience in the finance and investment banking industry.

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APPENDIX I

GENERAL INFORMATION

1. RESPONSIBILITY STATEMENT

This supplemental circular, for which the Directors collectively and individually accept full responsibility, includes particulars given in compliance with the Listing Rules for the purpose of giving information with regard to the Company. The Directors, having made all reasonable inquiries, confirm that to the best of their knowledge and belief the information contained in this circular is accurate and complete in all material respects and not misleading or deceptive, and there are no other matters the omission of which would make any statement herein or this supplemental circular misleading.

2. DISCLOSURE OF INTERESTS

Directors and Chief Executive

As of the Latest Practicable Date and in accordance with the records of the Company maintained in accordance with the SFO and the Listing Rules, the interests and short positions of the Directors or Chief Executive of the Company in the Shares, underlying Shares and debentures of the Company or any associated corporations (within the meaning of Part XV of the SFO) which are required to be notified to the Company and the Stock Exchange pursuant to Divisions 7 and 8 of Part XV of the SFO, including interests and short positions which the Directors and the Chief Executive of the Company are taken and deemed to have under such provisions of the SFO, or which are required to be and are recorded in the register required to be kept under Section 352 of the SFO or as otherwise notified to the Company and the Stock Exchange pursuant to the Model Code are as follows:

					Approximate
				Approximate	percentage of
				percentage in	the Company's
	Class of	Nature of	Number of	Shares of the	total issued
Name of Director	Shares	interest	Shares	same class(1)	share capital(1)
Yaping Ou(2)	Domestic	Interest of	81,000,000	8.10%	5.51%
	Shares	controlled	(Long
		corporation	position)

Notes:

The shareholding percentages are calculated on the basis of 1,000,000,000 Domestic Shares and 469,812,900 H Shares.
Cnhooray Internet Technology Co. Ltd. (深圳日訊網絡科技股份有限公司) is a subsidiary of Timeway Holdings Limited (中宇集團有限公司). The entire interest of Timeway Holdings Limited (中宇集團有限公司) is held by Sinolink, of which approximately 45.10% of its shareholding is held by Asia Pacific Promotion Limited, a company wholly owned by Mr. Yaping Ou, an executive Director and the chairman of the Board. As such, Timeway Holdings Limited (中宇集團有限公司), Sinolink, Asia Pacific Promotion Limited and Mr. Yaping Ou are deemed to be interested in the Shares held by Cnhooray Internet Technology Co. Ltd. (深圳日訊網絡科技股份有限公司).

− I-1 −

APPENDIX I

GENERAL INFORMATION

Save as disclosed above, as at the Latest Practicable Date, so far as is known to any Director or the Chief Executive of the Company, none of the Directors and the Chief Executive of the Company had any interests or short positions in the Shares, underlying Shares or debentures of the Company or its associated corporations (within the meaning of Part XV of the SFO) which (a) were required to be notified to the Company and the Stock Exchange pursuant to Part XV of the SFO (including the interests and short positions which the Director is taken or deemed to have under such provisions of the SFO); or (b) were required, pursuant to section 352 of the SFO, to be entered in the register referred to therein; or (c) were required, pursuant to the Model Code to be notified to the Company and the Stock Exchange.

As at the Latest Practicable Date, the following Directors were directors or employee of companies which had an interest in the shares and underlying shares of the Company which would fall to be disclosed under the provisions of Divisions 2 and 3 of Part XV of the SFO:

Mr. Yaping Ou is a non-executive director of Sinolink and the chairman of Cnhooray Internet Technology Co. Ltd. Sinolink is deemed to be interested in, for the purpose of the SFO, 81,000,000 Domestic Shares, representing approximately 5.51% of the total number of issued shares of the Company. All of such 81,000,000 Domestic Shares are held by Cnhooray Internet Technology Co. Ltd., a subsidiary of Timeway Holdings Limited, which in turn is entirely owned by Sinolink Worldwide Holdings Limited.
Mr. Xiaoming Hu is the president of Ant Financial. Ant Financial is interested in 199,000,000 Domestic Shares, representing approximately 13.53% of the total number of issued shares of the Company.
Mr. Xinyi Han is the vice president of Ant Financial. Ant Financial is interested in 199,000,000 Domestic Shares, representing approximately 13.53% of the total number of issued shares of the Company.
Mr. Ming Yin is the vice president of Ant Financial. Ant Financial is interested in 199,000,000 Domestic Shares, representing approximately 13.53% of the total number of issued shares of the Company.
Mr. Jimmy Chi Ming Lai is the vice president of Tencent Holdings Limited. Tencent Holdings Limited is deemed to be interested in, for the purpose of the SFO, 150,000,000 Domestic Shares, representing approximately 10.20% of the total number of issued shares of the Company. All of such 150,000,000 Domestic Shares are held by Tencent Computer System, which is a consolidated affiliated entity (through contractual arrangements) of Tencent Holdings Limited.
Mr. Hugo Jin Yi Ou is a non-executive director of Sinolink. Sinolink is deemed to be interested in, for the purpose of the SFO, 81,000,000 Domestic Shares, representing approximately 5.51% of the total number of issued shares of the Company. All of such 81,000,000 Domestic Shares are held by Cnhooray Internet Technology Co. Ltd., a subsidiary of Timeway Holdings Limited, which in turn is entirely owned by Sinolink.

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APPENDIX I

GENERAL INFORMATION

Save as disclosed above, as at the Latest Practicable Date, the Directors were not aware of any other Director who was a director or employee of a company which had an interest in the shares and underlying shares of the Company which would fall to be disclosed under the provisions of Divisions 2 and 3 of Part XV of the SFO.

Substantial Shareholders

As of the Latest Practicable Date, so far as the Directors are aware, the following persons (other than the Directors or Chief Executive of the Company) have an interest or short position in the Shares or underling Shares which are required to be disclosed to the Company and the Stock Exchange under the provisions of Divisions 2 and 3 of Part XV of the SFO, as recorded in the register required to be kept by the Company pursuant to section 336 of the SFO:

					Approximate
				Approximate	percentage of
				percentage in	the Company's
Name of	Class of	Nature of	Number of	Shares of the	total issued
Shareholder	Shares	interest	Shares(1)	same class(2)	share capital(2)
Ant Financial (3)	Domestic	Beneficial	199,000,000	19.90%	13.53%
	Shares	interest
Hangzhou Junao	Domestic	Interest of	199,000,000	19.90%	13.53%
Equity	Shares	controlled
Investments		corporation
Partnership
(Limited
Partnership)(3)
Hangzhou Junhan	Domestic	Interest of	199,000,000	19.90%	13.53%
Equity	Shares	controlled
Investments		corporation
Partnership
(Limited
Partnership)(3)
Hangzhou Yunbo	Domestic	Interest of	199,000,000	19.90%	13.53%
Investment	Shares	controlled
Consulting Co.,		corporation
Ltd.(3)
Yun Ma(3)	Domestic	Interest of	199,000,000	19.90%	13.53%
	Shares	controlled
		corporation
Tencent Computer	Domestic	Beneficial	150,000,000	15.00%	10.20%
System(4)	Shares	interest

− I-3 −

APPENDIX I			GENERAL INFORMATION
					Approximate
				Approximate	percentage of
				percentage in	the Company's
Name of	Class of	Nature of	Number of	Shares of the	total issued
Shareholder	Shares	interest	Shares(1)	same class(2)	share capital(2)
Huateng Ma(4)	Domestic	Interest of	150,000,000	15.00%	10.20%
	Shares	controlled
		corporation
Tencent Holdings	Domestic	Interest of	150,000,000	15.00%	10.20%
Limited(4)	Shares	controlled
		corporation
Ping An Insurance(5)	Domestic	Beneficial	150,000,000	15.00%	10.20%
	Shares	interest
Shenzhen Jia De	Domestic	Beneficial	140,000,000	14.00%	9.52%
Xin Investment	Shares	interest
Limited(6)
Shenzhen	Domestic	Interest of	140,000,000	14.00%	9.52%
Huaxinlian	Shares	controlled
Investment		corporation
Limited(6)
Yafei Ou(6)	Domestic	Interest of	140,000,000	14.00%	9.52%
	Shares	controlled
		corporation
Unifront Holding	Domestic	Beneficial	90,000,000	9.00%	6.12%
Limited(7)	Shares	interest
Shanghai Songlu	Domestic	Interest of	90,000,000	9.00%	6.12%
Investment	Shares	controlled
Management Co.,		corporation
Ltd.(7)
Shanghai Jianglu	Domestic	Interest of	90,000,000	9.00%	6.12%
Investment	Shares	controlled
Management Co.,		corporation
Ltd.(7)
Shanghai Xinlu	Domestic	Interest of	90,000,000	9.00%	6.12%
Investment	Shares	controlled
Management Co.,		corporation
Ltd.(7)

− I-4 −

APPENDIX I			GENERAL INFORMATION
					Approximate
				Approximate	percentage of
				percentage in	the Company's
Name of	Class of	Nature of	Number of	Shares of the	total issued
Shareholder	Shares	interest	Shares(1)	same class(2)	share capital(2)
Shanghai Youlu	Domestic	Interest of	90,000,000	9.00%	6.12%
Investment	Shares	controlled
Management Co.,		corporation
Ltd.(7)
Zhen Zhang(7)	Domestic	Interest of	90,000,000	9.00%	6.12%
	Shares	controlled
		corporation
Cnhooray Internet	Domestic	Beneficial	81,000,000	8.10%	5.51%
Technology Co.	Shares	interest
Ltd.(8)
Timeway Holdings	Domestic	Interest of	81,000,000	8.10%	5.51%
Limited(8)	Shares	controlled
		corporation
Sinolink Worldwide	Domestic	Interest of	81,000,000	8.10%	5.51%
Holdings	Shares	controlled
Limited(8)		corporation
Asia Pacific	Domestic	Interest of	81,000,000	8.10%	5.51%
Promotion	Shares	controlled
Limited(8)		corporation
Qingdao Huilijun	Domestic	Beneficial	50,000,000	5.00%	3.40%
Trading Company	Shares	interest
Limited(9)
Gongqingcheng	Domestic	Interest of	50,000,000	5.00%	3.40%
Shengchuang	Shares	controlled
Investment		corporation
Partnership
(Limited
Partnership)(9)
Shengchuang Weiye	Domestic	Interest of	50,000,000	5.00%	3.40%
(Xiamen) Equity	Shares	controlled
Investment Fund		corporation
Management
Limited(9)

− I-5 −

APPENDIX I			GENERAL INFORMATION
					Approximate
				Approximate	percentage of
				percentage in	the Company's
Name of	Class of	Nature of	Number of	Shares of the	total issued
Shareholder	Shares	interest	Shares(1)	same class(2)	share capital(2)
Shenzhen Qianhai	Domestic	Interest of	50,000,000	5.00%	3.40%
Lihui Fund	Shares	controlled
Management		corporation
Limited(9)
Yu Chen(9)	Domestic	Interest of	50,000,000	5.00%	3.40%
	Shares	controlled
		corporation
Zuojie Peng(9)	Domestic	Interest of	50,000,000	5.00%	3.40%
	Shares	controlled
		corporation
Shanghai Yuanqiang	Domestic	Beneficial	50,000,000	5.00%	3.40%
Investment	Shares	interest
Company Limited
(10)
Song Zou(10)	Domestic	Interest of	50,000,000	5.00%	3.40%
	Shares	controlled
		corporation
Keywise ZA	H Shares	Beneficial	60,309,167	12.83%	4.10%
Investment(11)		interest
SVF Zen Subco	H Shares	Beneficial	71,909,800	15.30%	4.89%
(Singapore) Pte.		interest
Ltd.(12)
SVF Holdco	H Shares	Interest of	71,909,800	15.30%	4.89%
(Singapore) Pte.		controlled
Ltd.(12)		corporation
SVF Holdings	H Shares	Interest of	71,909,800	15.30%	4.89%
(Cayman) Ltd.(12)		controlled
		corporation
SVF Holdings (UK)	H Shares	Interest of	71,909,800	15.30%	4.89%
LLP(12)		controlled
		corporation

− I-6 −

APPENDIX I			GENERAL INFORMATION
					Approximate
				Approximate	percentage of
				percentage in	the Company's
Name of	Class of	Nature of	Number of	Shares of the	total issued
Shareholder	Shares	interest	Shares(1)	same class(2)	share capital(2)
SoftBank Vision	H Shares	Interest of	71,909,800	15.30%	4.89%
Fund L.P.(12)		controlled
		corporation
Vision Technology	H Shares	Interest of	71,909,800	15.30%	4.89%
Investment		controlled
Company(12)		corporation
Public Investment	H Shares	Interest of	71,909,800	15.30%	4.89%
Fund(12)		controlled
		corporation
SVF GP (Jersey)	H Shares	Interest of	71,909,800	15.30%	4.89%
Limited(12)		controlled
		corporation
Softbank Group	H Shares	Interest of	71,909,800	15.30%	4.89%
Corp.(12)		controlled
		corporation

Notes:

All the Shares are held in long position (as defined under Part XV of the SFO) unless otherwise specified.
The shareholding percentages are calculated on the basis of 1,000,000,000 Domestic Shares and 469,812,900 H Shares.
Hangzhou Junao Equity Investments Partnership (Limited Partnership) (杭州君澳股權投資合夥企業(有限合夥)) ("Hangzhou Junao") holds 21.53% shares in Ant Financial and Hangzhou Junhan Equity Investments Partnership (Limited Partnership) (杭州君瀚股權投資合夥企業(有限合夥)) ("Hangzhou Junhan") holds 28.45% shares in Ant Financial. As such, Hangzhou Junao and Hangzhou Junhan are deemed to be interested in the Shares held by Ant Financial. The voting rights of Hangzhou Junao and Hangzhou Junhan in Ant Financial are controlled by Hangzhou Yunbo Investment Consulting Co., Ltd. (杭州雲鉑投資諮詢有限公司) ("Hangzhou Yunbo"), the general partner, which in turn is entirely owned by Yun Ma (馬雲). As such, Hangzhou Yunbo and Yun Ma (馬雲) are deemed to be interested in the Shares held by Ant Financial.
Tencent Computer System is a consolidated affiliated entity (through contractual arrangements) of Tencent Holdings Limited, a company listed on the Main Board of the Stock Exchange (Stock Code: 0700), and is one of its principal PRC domestic operating entities. Tencent Computer System is a leading provider of internet value added services in the PRC and a clear holder of the Company's Shares. As such, Tencent Holdings Limited is deemed to be interested in the Shares held by Tencent Computer System. Huateng Ma (馬化騰) holds 54.29% shares in Tencent Computer System.
Ping An Insurance is a joint-stock company incorporated in the PRC and listed on Main Board of the Stock Exchange (stock code: 02318) and the Shanghai Stock Exchange (stock code: 601318).

− I-7 −

APPENDIX I

GENERAL INFORMATION

Shenzhen Jia De Xin Investment Limited (深圳市加德信投資有限公司) ("Shenzhen Jia De Xin") is a subsidiary of Shenzhen Huaxinlian Investment Limited (深圳市華信聯投資有限公司) ("Shenzhen Huaxinlian"). As such, Shenzhen Huaxinlian is deemed to be interested in the Shares held by Shenzhen Jia De Xin. Shenzhen Huaxinlian is controlled by Yafei Ou (歐亞非). As such, Yafei Ou (歐亞非) is deemed to be interested in the Shares held by Shenzhen Jia De Xin.
Unifront Holding Limited (優孚控股有限公司) ("Unifront") is owned by Shanghai Songlu Investment Management Co., Ltd. (上海松鹿投資管理有限公司) ("Shanghai Songlu") as to 25.00%, Shanghai Jianglu Investment Management Co., Ltd. (上海江鹿投資管理有限公司) ("Shanghai Jianglu") as to 16.90% and Shanghai Xinlu Investment Management Co., Ltd. (上海鑫鹿投資管理有限公司) ("Shanghai Xinlu") as to 13.10%. The entire interest of Shanghai Songlu, Shanghai Jianglu and Shanghai Xinlu are held by Shanghai Youlu ("Shanghai Youlu"), which in turn is controlled by Zhen Zhang (張真). As such, Shanghai Youlu, Shanghai Songlu, Shanghai Jianglu and Shanghai Xinlu are deemed to be interested in the Shares held by Unifront. As such, Zhen Zhang (張真) is deemed to be interested in the Shares held by Unifront.
Cnhooray Internet Technology Co. Ltd. (深圳日訊網絡科技股份有限公司) is a subsidiary of Timeway Holdings Limited (中宇集團有限公司). The entire interest of Timeway Holdings Limited (中宇集團有限公司) is held by Sinolink, of which approximately 45.10% of its shareholding is held by Asia Pacific Promotion Limited, a company wholly owned by Mr. Yaping Ou, the chairman of the Board and an executive Director. As such, Timeway Holdings Limited (中宇集團有限公司), Sinolink, Asia Pacific Promotion Limited and Mr. Yaping Ou are deemed to be interested in the Shares held by Cnhooray Internet Technology Co. Ltd. (深圳日訊網絡科技股份有限公司).
Qingdao Huilijun Trading Company Limited (青島惠麗君貿易有限公司) ("Qingdao Huilijun") is a wholly owned subsidiary of Gongqingcheng Shengchuang Investment Partnership (Limited Partnership) (共青城盛創投資合夥企業 (有限合夥)) ("Gongqingcheng Shengchuang LP"). The general partner of Gongqingcheng Shengchuang LP is Shengchuang Weiye (Xiamen) Equity Investment Fund Management Limited (盛創偉業 (廈門) 股權投資基金管理有限公司) ("Shengchuang Weiye"), which is wholly owned by Shenzhen Qianhai Lihui Fund Management Limited (深圳前海力匯基金管理有限公司) ("Shenzhen Qianhai Fund"). Each of Yu Chen (陳宇) and Zuojie Peng (彭作傑) holds 50.00% of Shenzhen Qianhai Fund. As such, Gongqingcheng Shengchuang LP, Shengchuang Weiye, Shenzhen Qianhai Fund, Yu Chen (陳宇) and Zuojie Peng (彭作傑) are deemed to be interested in the Shares held by Qingdao Huilijun.
Shanghai Yuanqiang Investment Company Limited (上海遠強投資有限公司) ("Shanghai Yuanqiang") is owned by Song Zou (鄒松) as to 80.00%. As such, Song Zou (鄒松) is deemed to be interested in the Shares held by Shanghai Yuanqiang.
Keywise ZA Investment is an investment of Keywise Fund. The investment advisor of Keywise Fund is Keywise Capital Management (HK) Limited which in turn owns 23.00% interest in Keywise ZA Investment. Other investors own 77.00% interest in Keywise ZA Investment.
SVF Zen Subco (Singapore) Pte. Ltd. is a wholly owned subsidiary of SVF Holdco (Singapore) Pte. Ltd., which is wholly owned by SVF Holdings (Cayman) Ltd. SVF Holdings (Cayman) Ltd. is a wholly owned subsidiary of SVF Holdings (UK) LLP, which is wholly owned by SoftBank Vision Fund L.P., which is owned by Vision Technology Investment Company as to 48.31%. Vision Technology Investment Company is wholly owned by Public Investment Fund. The general partner of SoftBank Vision Fund L.P. is SVF GP (Jersey) Limited and the ultimate parent company is SoftBank Group Corp., which is a Japanese corporation listed on the Tokyo Stock Exchange (Stock Code: 9984).

Save as disclosed above, according to the register kept by the Company under Section 336 of the SFO, there was no other person who had a substantial interest or short positions in the Shares or underlying Shares as at the Latest Practicable Date.

− I-8 −

APPENDIX I

GENERAL INFORMATION

3. FURTHER INFORMATION CONCERNING DIRECTORS

Directors' service contracts

As at the Latest Practicable Date, none of the Directors had entered, or was proposing to enter, into any service contract with any member of the Group (excluding contracts expiring or determinable by such member of the Group within one year without payment of compensation (other than statutory compensation)).

Directors' interest in competing business

As at the Latest Practicable Date, none of the Directors or their respective close associate is or was interested in any business apart from the Group's business, that competes or is likely to compete, either directly or indirectly, with the Group's business.

Directors' interest in assets

None of the Directors had any direct or indirect interest in any assets which had been acquired or disposed of or leased to any member of the Group or proposed to be so acquired, disposed of or leased since December 31, 2018, being the date to which the latest published audited accounts of the Company were made up, and up to the Latest Practicable Date.

Directors' interest in contracts

As at the Latest Practicable Date, there is no contract or arrangement subsisting in which any of the Directors is materially interested and which is significant in relation to the business of the Group.

4. MATERIAL ADVERSE CHANGE

As at the Latest Practicable Date, the Directors were not aware of any material adverse change in the financial position or trading prospects of the Group since December 31, 2018, the date to which the latest published audited financial statements of the Company were made up.

5. QUALIFICATION AND CONSENT OF EXPERT

The following is the qualification of the expert or professional adviser who has given opinion or advice contained in this circular:

Name	Qualification
Lego Corporate Finance	corporation licensed to carry out type 6 (advising on
Limited	corporate finance) regulated activity under the SFO

Lego Corporate Finance Limited has given and has not withdrawn its written consent to the issue of this circular with the inclusion of its letter and references to its name in the form and context in which they respectively appear.

− I-9 −

APPENDIX I

GENERAL INFORMATION

INTERESTS OF EXPERT
As at the Latest Practicable Date, Lego Corporate Finance Limited:
1. did not have any shareholding in any member of the Group or any right (whether legally enforceable or not) to subscribe for or to nominate persons to subscribe for securities in any member of the Group; and
2. was not interested, directly or indirectly, in any assets which have been or are proposed to be acquired or disposed of by or leased to any member of the Group since December 31, 2018, being the date to which the latest published audited accounts of the Company were made up.
DOCUMENTS AVAILABLE FOR INSPECTION

Copies of the below documents will be available for inspection during normal business hours at Level 54, Hopewell Centre, 183 Queen's Road East, Hong Kong from the date of this supplemental circular up to and including the date of the EGM:

the Online Platform Cooperation Framework Agreement;
the Auto Co-insurance Cooperation Agreement;
the Auto Co-insurance Cooperation Framework Agreement;
a letter of recommendation from the Independent Board Committee, the text of which is set out on pages 19 to 20 of this supplemental circular;
a letter of advice from Lego Corporate Finance Limited, the text of which is set out on pages 21 to 46 of this supplemental circular; and
the written consent from Lego Corporate Finance Limited referred to in paragraph 5 of this appendix.

− I-10 −

SUPPLEMENTAL NOTICE OF THE EGM

眾安在綫財產保險股份有限公司

ZHONGAN ONLINE P & C INSURANCE CO., LTD.*

(A joint stock limited company incorporated in the People's Republic of China with limited liability

and carrying on business in Hong Kong as "ZA Online Fintech P & C")

(Stock Code: 6060)

SUPPLEMENTAL NOTICE OF EGM

References are made to the circular and the notice of the extraordinary general meeting (the "EGM") of ZhongAn Online P & C Insurance Co., Ltd. (the "Company") dated November 12, 2019 (the "Original Notice of EGM"), which set out the time and venue of the EGM and contain the resolutions to be submitted at the EGM for shareholders' approval.

SUPPLEMENTAL NOTICE IS HEREBY GIVEN that the EGM will be held as originally scheduled at Conference Room 1, 2/F, 219 Yuanmingyuan Road, Huangpu District, Shanghai, the PRC at 10:00 a.m. on Friday, December 27, 2019 for the purposes of considering, and if thought fit, approving the following resolutions, in addition to the resolutions set out in the Original Notice of EGM:

ORDINARY RESOLUTION

"THAT

1. the revised annual cap for the continuing connected transactions under the Online Platform Cooperation Framework Agreement (as defined in the supplemental circular of the Company dated November 22, 2019) (the "Supplemental Circular")) for the year ending December 31, 2019 (the "Further Revised Ant Financial Online Platform Annual Cap"), be and are hereby approved, confirmed and ratified;
2. the New Online Platform Cooperation Framework Agreement (as defined in the Supplemental Circular) and the transactions contemplated thereunder (including the Ant Financial Annual Caps), be and are hereby approved, confirmed and ratified;
3. the Auto Co-insurance Cooperation Agreements (as defined in the Supplemental Circular) and the transactions contemplated thereunder (including the Ping An Annual Caps), be and are hereby approved, confirmed and ratified; and
For identification purposes only and carrying on business in Hong Kong as "ZA Online Fintech P & C".

− SEGM-1 −

SUPPLEMENTAL NOTICE OF THE EGM

any one director of the Company be and are hereby generally and unconditionally authorized to do all such further acts and things and to sign and execute all such other or further documents and to take all such steps as he/she may consider necessary, desirable, appropriate or expedient to implement and/or give effect to or otherwise in connection with each of the New Online Platform Cooperation Framework Agreement and the Auto Co-insurance Cooperation Agreements and the transactions respectively contemplated thereunder, and the Further Revised Ant Financial Online Platform Annual Cap."

By order of the Board

ZhongAn Online P & C Insurance Co., Ltd.

Ya Ping Ou

Chairman

Shanghai, the PRC

November 22, 2019

Notes:

Save for the inclusion of the additional resolutions, there are no other changes to the other resolutions as set out in the Original Notice of EGM.
Since the proxy form sent together with the Circular (the "Original Proxy Form") does not contain the additional resolutions as set out in this supplemental notice of the EGM (the "Supplemental Notice"), a new proxy form (the "Supplemental Proxy Form") is enclosed with this Supplemental Notice.
If any shareholder of the Company has not yet lodged the Original Proxy Form according to the instruction in the Original Notice of EGM and wishes to appoint a proxy to attend the EGM on his or her behalf, he or she is required to lodge the Supplemental Proxy Form. In this case, the shareholder of the Company shall not lodge the Original Proxy Form.
In order to be valid, the Supplemental Proxy Form together with the notarized power of attorney or other authorization document (if any) must be deposited at the Company's H share registrar, Tricor Investor Services Limited, at Level 54, Hopewell Centre, 183 Queen's Road East, Hong Kong (for holders of H shares of the Company) or the Company's office of the board of directors at 4-5/F, Associate Mission Building, 169 Yuanmingyuan Road, Shanghai, the PRC (for holders of domestic shares of the Company) not less than 24 hours before the time fixed for the holding of the EGM (i.e. before 10:00 a.m. on Thursday, December 26, 2019) or any adjournment thereof (as the case may be).
For any shareholder of the Company who has lodged the Original Proxy Form with the Company's H share registrar or the Company's office of the board of directors, please note that:
1. if no Supplemental Proxy Form is lodged with the Company's H share registrar or the Company's office of the board of directors, the Original Proxy Form will be treated as a valid proxy form lodged by the Shareholder if duly completed. The proxy so appointed by the Shareholder will be entitled to vote at his or her discretion or to abstain from voting on the resolutions properly put to the EGM other than those referred to in the Original Notice of EGM and the Original Proxy Form;
2. if the Supplemental Proxy Form is lodged with the Company's H share registrar or the Company's office of the board of directors at or before 10:00 a.m. on Thursday, December 26, 2019, the Supplemental Proxy Form, whether duly completed or not, will revoke and supersede the Original Proxy Form previously lodged by the shareholder. The Supplemental Proxy Form will be treated as a valid proxy form if duly completed; and

− SEGM-2 −

SUPPLEMENTAL NOTICE OF THE EGM

1. if the Supplemental Proxy Form is lodged with the Company's H share registrar or the Company's office of the board of directors after 10:00 a.m. on Thursday, December 26, 2019, the Supplemental Proxy Form will be deemed invalid. It will not revoke the Original Proxy Form previously lodged by the Shareholder. The Original Proxy Form will be treated as a valid proxy form if duly completed. The proxy so appointed by the Shareholder will be entitled to vote at his or her discretion or to abstain from voting on the resolutions properly put to the EGM other than those referred to in the Original Notice of EGM and the Original Proxy Form.
Completion and return of the Original Proxy Form and/or the Supplemental Proxy Form will not preclude a shareholder of the Company from attending and voting in person at the EGM or any adjournment thereof if he so wishes.
Please refer to the Original Notice of EGM for details about the resolutions to be submitted for consideration and approval at the EGM, eligibility of shareholders of the Company to attend the EGM, appointment of proxies, registration procedures, closure of register of members and other matters.
References to time and dates in this notice are to Hong Kong time and dates.

− SEGM-3 −

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ZhongAn Online P & C Insurance Co. Ltd. published this content on 21 November 2019 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 21 November 2019 11:10:03 UTC

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Chart ZhongAn Online P & C Insurance Co., Ltd.

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Company Profile

ZhongAn Online P & C Insurance Co., Ltd. is a China-based online insurance company. The Company provides insurance services include lifestyle consumption insurance, consumer finance insurance, health insurance, auto insurance and travel insurance. The Companyâs products include shipping return policy, online payment security insurance, account security insurance, phone accident policy, phone screen crack policy, Baobei Open Platform, Mashanghua, individual health insurance, group health insurance plans, flight accident and delay policy and among others.

Sector

Property & Casualty Insurance

Calendar

2024-08-25 - Q2 2024 Earnings Release (Projected)

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ESG Refinitiv

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Analysts' Consensus

Sell

Buy

Mean consensus

BUY

Number of Analysts

Last Close Price

12.32 CNY

Average target price

20.18 CNY

Spread / Average Target

+63.85%

Consensus

EPS Revisions

Estimates Revisions

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Company calendar

Sector Other Property & Casualty Insurance

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SAMPO OYJ	-0.43%	21.46B

Other Property & Casualty Insurance

ZhongAn Online P & C Insurance Co., Ltd.

Equities

6060

CNE100002QY7

Property & Casualty Insurance

ZhongAn Online P & C Insurance : (1) REVISION OF ANNUAL CAP OF EXISTING CONTINUING CONNECTED TRANSACTION; (2) CONTINUING CONNECTED TRANSACTIONS IN RELATION TO THE NEW ONLINE PLATFORM COOPERATION FRAMEWORK AGREEMENT AND THE AUTO CO-INSURANCE COOPERATION AGREEMENTS; AND (3) SUPPLEMENTAL NOTICE OF EGM

Latest news about ZhongAn Online P & C Insurance Co., Ltd.

Chart ZhongAn Online P & C Insurance Co., Ltd.

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Income Statement Evolution

Ratings for ZhongAn Online P & C Insurance Co., Ltd.

Analysts' Consensus

EPS Revisions

Annual profits - Rate of surprise

Sector Other Property & Casualty Insurance