By 2025, China is expected to house over 1 million inhabitants in 221 cities – news which will bring the urban population up to 1 billion and pose both an insurance opportunity and a challenge. Natural risks One of China’s major challenges is their vulnerability to natural threats; especially as two of China’s megacities (Beijing and Tianjin) are defenseless against earthquakes. In fact, since 1965, some of the world’s most expensive natural disasters have struck China. This figure has greatly affected insurance statistics. Many believe that China will undoubtedly become a major catastrophe zone for the reinsurance industry after the European windstorm, the USA wind and quake and the Japanese wind and quake. When costs from rebuilding the Sichuan province after the 2008 earthquake are factored in, China’s megacities could become more of a challenge especially as there’s more than one concern to worry about with floods and typhoons also high risk in these areas. Population Current figures show the proportion of urban residents to China’s total population to be 53.7%, which is lower than the typical developed nations. Over a span of 10 years, the government hopes to push this figure up to 70%. Placing a mass of individuals in one urban space poses numerous challenges. There must be sufficient resources to move people from A to B and enough assets to go around. Urban planning and durable buildings are just one consideration to factor into the equation. Infrastructure Engineering and technological expertise are also expected to play a hugepart in tomorrow’s big cities. Optimists see a new network of powerful, stable and prosperous city states and in 2010, China surpassed the USA as the world’s principal car market so transportation will be one of the top assets to focus on. In 2013 alone, the number of cars sold reached a figure of over 20 million. Other investments must focus their attentions on underground subways and high-speed rail, as well as alternative mass transport devices. Many of these groundwork projects are already taking place and in 2012 the government sanctioned 25 new subway projects investing over $127 billion in the process. Natural resources One of the major challenges China is facing is the tension on natural resources, such as water. With precipitation at less than half the usual levels, Henan in central China is currently suffering from a...