As the two largest companies in China's life insurance market, China Life Insurance and Ping An Insurance are transforming from former industry rivals into close shareholder "allies."
According to financial reports and Hong Kong Exchange disclosure information from May 20th, a pattern of "cross-shareholding" has emerged between China Life and Ping An. Ping An has been continuously buying China Life's H-shares, while China Life has also appeared on the list of circulating A-share shareholders of Ping An.
Insurance capital increasing stakes in peers is not an isolated case. Ping An also holds shares of China Pacific Insurance's H-shares, and New China Life Insurance has increased its holdings of People's Insurance Company of China (PICC) A-shares for two consecutive quarters.
In the first quarter, insurance stocks experienced an adjustment, falling significantly more than the broader market. Major insurers increased their holdings in peer companies while other institutions chose to exit. This reflects a "mutual move" by insurance giants against a backdrop of low interest rates, scarce high-quality assets, and policy liberalization.
Increasing Stakes in Peers
On May 20th, Hong Kong Exchange disclosure information showed that Ping An once again increased its stake in China Life's H-shares, holding 1.199 billion shares, accounting for 16.12% of the issued voting shares.
On March 25th, Ping An increased its stake in China Pacific Insurance's H-shares, holding 335 million shares, accounting for 12.08% of the issued voting shares.
Simultaneously, according to the list of top ten circulating shareholders disclosed in Ping An's first-quarter report, China Life's insurance product account increased its holdings by over 43 million shares. By the end of 2025, China Life had newly entered the list of Ping An's top ten circulating shareholders.
Similarly, New China Life Insurance also shows a preference for peer stocks. Data shows that by the end of 2025, New China Life Insurance, through its participating insurance account and traditional insurance account, collectively held 159 million A-shares of PICC, securing a position among the top five circulating shareholders with a 0.56% stake.
By the first quarter of 2026, New China Life Insurance continued to increase its holdings of PICC A-shares, with the combined stake from its participating and traditional insurance accounts rising to 0.51%.
In fact, the phenomenon of increasing stakes in peers had already appeared during the surge of insurance capital stake increases in 2025. By year-end, the balance of insurance capital's stock investments reached 3.73 trillion yuan, and the number of stake increases in the secondary market hit a nearly 10-year high.
Huachuang Securities research shows that throughout 2025, insurance capital initiated stake increases a total of 31 times (not counting repeated triggers by the same entity). If repeated increases are considered, the number reaches at least 38 times.
From a market distribution perspective, H-shares became the main battlefield due to their dividend yield advantage, with 26 stake increases targeting Hong Kong-listed stocks throughout the year. The entities initiating these increases also shifted from former small and medium-sized insurers to leading insurers. In 2025, Ping An-related entities led with 7 stake increases, followed by Great Wall Life Insurance (5 times), China Post Life Insurance (4 times), and Ruizhong Life Insurance (4 times).
Why Target Peers?
"Previously, insurance companies invested heavily in fixed-income assets, including government bonds, corporate bonds, municipal bonds, and bank deposit agreements, achieving good returns. Currently, a large amount of renewal premium income comes from past high-yield products, which has become a 'sweet burden.' Insurers can only increase the proportion of equity investments to seek higher returns," said a senior life insurance industry professional. "Additionally, current market expectations are relatively positive, and policy adjustments have relaxed the investment ratio for insurance capital's equity assets."
In the latest asset allocation landscape for insurance funds, bonds form the base, accounting for 50.5%. The proportion allocated to stocks, at 10.1%, exceeds that allocated to bank deposits. In 2023, the balance of insurance capital's stock investments accounted for less than 8%.
Against the backdrop of low interest rates, household deposits are accelerating their shift, with a portion flowing into insurance, keeping the liability side of insurers growing at a relatively high rate.
As premium income grows, the balance of insurance fund utilization increases synchronously. 39.44 trillion yuan—this is the balance of insurance fund utilization at the end of the first quarter of 2026, already exceeding the 37.53 trillion yuan net asset value scale of public funds during the same period. Notably, regarding the operational balance of funds in stock investments, insurance capital is approaching the scale of active equity funds managed by public funds. Zhongtai Securities research indicates that the balance of insurance capital's stock investments reached 3.84 trillion yuan, only 150 billion yuan less than the 3.99 trillion yuan scale of public funds' active equity funds (ordinary stock + equity-biased hybrid + flexible allocation).
"Currently, the 10-year government bond yield is stable around 1.8%, and high-quality alternative assets have also become scarce. In this context, insurance capital's demand for allocating to stocks with high dividend yields has increased," said Chen Hui, Director of the China Actuarial Science Laboratory at the Central University of Finance and Economics.
As quasi-fixed-income assets, high-dividend-yield stocks are mostly concentrated in mature industries with stable cash flows, such as banking, utilities, and energy. These are also industries heavily weighted by insurance capital. In the 2025 stake increases by insurance capital, the banking and utilities sectors saw 7 and 6 stake increases respectively. Non-bank financials, primarily insurance, also became an important allocation direction.
This preference became even more pronounced in the first quarter of 2026. Data shows that among insurance capital's A-share holdings in the first quarter, banking and insurance had the highest proportions. Sectors such as power and utilities, transportation, home appliances, and food and beverage were among those that saw more significant increases in holdings.
"The development trends and potential of some industries are unclear or average, while insurance companies have a relatively thorough understanding of their own industry and competitors. Investing in leading companies within the same industry offers more certainty. For a period, insurance industry stock prices were at low levels, which was also a good opportunity to accumulate shares," added the senior life insurance professional.
In the A-share market, the banking and insurance sectors offer relatively high dividend yields. Huachuang Securities research shows that in 2025, the average dividend yield of A-share listed insurers was 3.74%, while for H-shares it was 4.67%, significantly higher than the 10-year government bond yield. For trillions in insurance capital urgently seeking "quasi-fixed-income" assets, insurance stocks themselves have become high-dividend-yield targets.
CITIC Securities research indicates that 44.8 trillion yuan in medium- to long-term fixed deposits will mature in 2026, potentially driving non-bank deposits to achieve growth on the scale of 10 trillion yuan. From an investment perspective, insurance capital's OCI (financial assets measured at fair value through other comprehensive income) accounts continue to increase allocations to dividend-paying financial stocks. It is estimated that over the next five years, incremental equity funds from insurance capital will exceed 6 trillion yuan, with financial stocks potentially capturing over 30% of this.
From the perspective of Zhu Junsheng, a postdoctoral fellow in applied economics at Peking University, leading insurers holding each other's shares can allow them to share in shareholder returns, enhance the possibility of long-term strategic collaboration between the parties, convey a signal of stability, and improve the industry's credibility in the capital market.
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