The insurance sector strengthened, with gains exceeding 5%

[Source: Global Times]

[Global Times Finance Comprehensive Report] On April 8, the insurance sector collectively strengthened, with gains exceeding 5%. In terms of individual stocks, China Taiping Life Insurance rose by more than 7%, while New China Life, China Life, Ping An, and PICC Property & Casualty each rose by more than 4%.

According to the 2025 annual reports of five listed insurers, their net profit attributable to shareholders totaled 425.291 billion yuan, up 22.4% year on year; their total investment assets exceeded 20.7 trillion yuan, up 12.8% from the end of 2024. In 2025, investment returns became the core factor driving profit growth. New China Life’s total investment yield reached 6.6%, the highest level since 2015; Ping An’s comprehensive investment yield was 6.3%, up 0.5 percentage points year on year.

All five insurers mentioned that in 2025 they increased the allocation to equity-type assets, precisely capturing opportunities in the capital markets, and equity investment returns reached the best level in recent years. By the end of 2025, the total amount of stock investments held by the five insurers was 2.5 trillion yuan, an increase of more than 1 trillion yuan compared with the end of the prior year, representing a growth rate of 75.2%; the proportion of stocks in investment assets rose to 12.2%.

Guotai Haitong Securities analysts believe that in 2025, the equity market combined with rising interest rates, together with insurers strengthening their asset-liability management capabilities, enabled overall high growth in profits, net assets, and value, which is generally in line with expectations. With high profit growth, the dividend payout ratio remained stable, and there was a strong emphasis on shareholder returns. Improvements in investment service performance are a primary source of profit for life insurance companies; some insurers also benefited from improved insurance service performance and improvements in income tax. For property and casualty insurers, improvements in COR drove significant growth in underwriting profits.

As for the overall positive growth in net assets attributable to shareholders, the above analysis suggests that profit growth driven by the upward equity market offset the negative impact on other comprehensive income caused by interest rate fluctuations. The improvement in the financial changes in BBA insurance contracts resulting from rising interest rates could not fully offset the decline in the fair value of OCI bonds, so other comprehensive income still had a negative impact on net assets.

From the investment side, it is expected that insurers’ asset-liability management capabilities will effectively improve, and diversified asset allocation strategies will help drive steady growth in earnings. (Wen Hui)