Guizhou-based Huagui Life Insurance has received regulatory approval to increase its registered capital by 615 million yuan ($86 million), raising it from 2 billion yuan to 2.615 billion yuan. The move comes as the company advances a larger 2.5-4.5 billion yuan fundraising plan initiated in late 2024, which could ultimately expand its capital base to 4.5-6.5 billion yuan.
As Guizhou's first locally incorporated insurer, Huagui Life reached an operational turning point in its eighth year. The company reported 4.523 billion yuan in premium income for the first three quarters of 2025, marking 31.03% year-over-year growth, while achieving 183 million yuan in net profit—a significant improvement from previous losses. Its investment performance ranked 14th (4.28% yield) and 8th (5.23% comprehensive yield) among life insurers.
This capital injection addresses both regulatory requirements under China's "C-ROSS Phase II" framework, which mandates higher solvency ratios, and aligns with the industry's broader recapitalization trend. By December 15, 2025, insurers had replenished approximately 114.4 billion yuan in capital, with life insurers leading the charge through a combination of equity raises and bond issuances.
The latest approval follows Huagui's 1 billion yuan capital increase in April 2023, when major shareholder Kweichow Moutai Group participated. The liquor giant now holds 33.33%—the regulatory maximum for single shareholders. A more ambitious 2.5-4.5 billion yuan fundraising effort remains underway, seeking up to 20 new investors with lock-up periods of 3-5 years.
Despite posting accumulated losses of 1.2 billion yuan since its 2017 founding, Huagui demonstrated improved fundamentals in 2025: total assets grew 17.45% to 25.541 billion yuan, while net assets surged 68.83% to 883 million yuan. Its Q3 solvency ratios stood at 118.80% (core) and 133.80% (comprehensive).
Industry-wide, life insurers accounted for 87% of the 19.8 billion yuan in approved capital increases among 14 institutions this year. Ping An Life's planned 20 billion yuan raise alone represents 40% of the sector's total anticipated equity injections. Smaller insurers typically sought 500 million-1.5 billion yuan boosts to meet solvency requirements.
The recapitalization wave responds to tightening regulations, with the life insurance sector's core solvency ratio declining to 118.9% in Q3 2025 from 123.8% at end-2024. Overall industry solvency ratios fell 13 percentage points year-over-year to 186.3%, prompting both domestic and foreign-backed insurers to strengthen their capital positions.
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