What has been the operational performance of the domestic captive insurance companies that have been developing for years?
Recently, S.F. Holding Co.,Ltd. subsidiary S.F. Insurance Company Limited obtained a dedicated captive insurer authorization from the Hong Kong Insurance Authority. This makes it the first mainland China privately-owned captive insurer in Hong Kong and the first in the logistics industry, granting SF a licensed insurer to manage risks within its group.
Globally, captive insurance companies are a standard feature for large corporations. There are currently four captive insurers operating in mainland China. China National Petroleum Corporation Captive Property Insurance Co., Ltd. was established in 2013, China Railway Property Insurance Captive Co., Ltd. in 2015, and both COSCO Shipping Property Insurance Captive Co., Ltd. and Guangdong Energy Property Insurance Captive Co., Ltd. were established in 2017. The parent companies of these four firms operate in oil & gas, railways, shipping, and power generation respectively, with significant differences in their insured subjects and risks.
What has been the operational performance of these domestic captive insurers after years of development?
Looking back to early 2016, only CNPC Captive and China Railway Captive existed domestically. Having operated for some time, both companies were showing improved performance. In Q1 2016, CNPC Captive reported insurance revenue of 2.82 billion yuan and a net profit of 0.69 billion yuan, with end-of-quarter net assets of 55.30 billion yuan. The corresponding three figures for China Railway Captive were 1.84 billion yuan, 0.10 billion yuan, and 20.22 billion yuan.
By 2017, COSCO Shipping Captive and Guangdong Energy Captive were established. COSCO Shipping Captive, in its first full year of operation in 2017, achieved insurance revenue of 2.02 billion yuan and a net profit of 0.47 billion yuan, with year-end net assets of 20.53 billion yuan. Guangdong Energy Captive accumulated insurance revenue of 0.10 billion yuan in 2017, with a net loss of 0.03 billion yuan and year-end net assets of 2.97 billion yuan. The scale at inception and the size of insurable risks within their respective groups already differed by multiples among the four companies.
A decade later, the scale gap among the four companies remains substantial. In 2025, CNPC Captive achieved insurance revenue of 18.08 billion yuan, ranking first among the four; China Railway Captive, COSCO Shipping Captive, and Guangdong Energy Captive reported 8.27 billion, 6.96 billion, and 0.73 billion yuan respectively. This size ranking was not replicated in terms of profitability. China Railway Captive led with a net profit of 2.35 billion yuan, followed by COSCO Shipping Captive with 1.48 billion yuan, CNPC Captive with 0.61 billion yuan, and Guangdong Energy Captive with 0.18 billion yuan.
Compared to 2024, CNPC Captive's 2025 insurance revenue grew by 18.44%, while its net profit fell by 74.09%. China Railway Captive saw increases of 14.35% and 16.62% in the two metrics respectively. COSCO Shipping Captive reported growth of 1.03% and 7.71%, while Guangdong Energy Captive saw declines of 17.87% and 24.48%.
Analyzing Profitability Drivers
Profit differences can first be examined from the underwriting side. In 2025, China Railway Captive's combined ratio was 77.57%, with expense and loss ratios of 41.52% and 36.05% respectively. CNPC Captive's combined ratio was 91.59%, with an expense ratio of 18.51% and a loss ratio of 73.07%. Both companies had combined ratios below 100%. CNPC Captive's combined ratio rose by 15.08 percentage points from 2024, with its expense ratio down 0.98 points and its loss ratio up 16.04 points, indicating greater pressure on claims. China Railway Captive's combined ratio fell by 7.38 points, with its expense ratio down 7.00 points and loss ratio down 0.39 points.
Guangdong Energy Captive's 2025 combined ratio remained high at 207.32%, with expense and loss ratios of 141.36% and 65.97% respectively. Although its combined ratio decreased by 12.16 percentage points from 2024, it was still far above 100%. COSCO Shipping Captive disclosed a combined ratio of -76.22%, an expense ratio of -251.34%, and a loss ratio of 175.11%.
Looking at underwriting structure via written premiums, in 2025, CNPC Captive's written premium was 8.85 billion yuan, China Railway Captive's was 6.74 billion yuan, COSCO Shipping Captive's was 6.44 billion yuan, and Guangdong Energy Captive's was 0.76 billion yuan. The sum of written premiums for the top five non-auto insurance lines was 7.21 billion, 5.08 billion, 6.43 billion, and 0.64 billion yuan respectively, accounting for 81.40%, 75.45%, 99.88%, and 84.16% of their respective total written premiums.
Underwriting data alone doesn't fully explain net profit; investment yield is also a major factor. In 2025, Guangdong Energy Captive had the highest annual cumulative investment yield and comprehensive investment yield among the four, both at 6.08%. China Railway Captive reported 2.78% and 2.39% respectively, COSCO Shipping Captive both at 2.46%, and CNPC Captive both at -0.47%. CNPC Captive experienced negative investment yield, a rising loss ratio, and declining net profit alongside premium expansion. Guangdong Energy Captive, despite a combined ratio exceeding 200%, achieved an investment yield of 6.08% and a full-year profit of 0.18 billion yuan, leading in both investment metrics for the year.
In terms of total assets, at the end of 2025, the earliest-established CNPC Captive led with total assets of 105.45 billion yuan and net assets of 72.56 billion yuan. China Railway Captive had total assets of 66.28 billion yuan and net assets of 37.01 billion yuan; COSCO Shipping Captive had 63.87 billion yuan and 26.33 billion yuan; Guangdong Energy Captive had 11.55 billion yuan and 6.09 billion yuan. Compared to the end of 2024, CNPC Captive's total and net assets fell by 3.52% and 5.08% respectively. China Railway Captive's total assets decreased by 0.52% while net assets grew by 6.35%. COSCO Shipping Captive's increased by 10.51% and 2.56% respectively, and Guangdong Energy Captive's grew by 7.63% and 2.18%.
Recent Quarterly Performance
Entering Q1 2026, CNPC Captive and Guangdong Energy Captive remained profitable, while China Railway Captive and COSCO Shipping Captive turned to losses. CNPC Captive achieved insurance revenue of 14.42 billion yuan and a net profit of 1.00 billion yuan. COSCO Shipping Captive reported insurance revenue of 5.21 billion yuan and a net loss of 0.09 billion yuan. China Railway Captive had insurance revenue of 2.46 billion yuan and a net loss of 0.04 billion yuan. Guangdong Energy Captive achieved insurance revenue of 0.29 billion yuan and a net profit of 0.31 billion yuan. Compared to the same period in 2025, CNPC Captive's insurance revenue and net profit grew by 9.02% and 24.68% respectively, while Guangdong Energy Captive's grew by 62.74% and 17.84%. China Railway Captive and COSCO Shipping Captive both turned from profit to loss.
In the same reporting period, the combined ratios for China Railway Captive, CNPC Captive, COSCO Shipping Captive, and Guangdong Energy Captive were 70.40%, 87.16%, 89.29%, and 304.24% respectively. Their annual cumulative investment yields were -0.91%, 0.54%, 0.06%, and 4.99% respectively, and annual cumulative comprehensive investment yields were 0.04%, 0.54%, 0.06%, and 4.99% respectively. End-of-quarter total assets were 62.96 billion, 114.69 billion, 72.32 billion, and 13.10 billion yuan respectively, with net assets of 37.43 billion, 73.56 billion, 26.25 billion, and 6.40 billion yuan respectively.
In Q1 2026, the disclosed written premiums for CNPC Captive, China Railway Captive, and COSCO Shipping Captive were 8.80 billion, 1.99 billion, and 5.18 billion yuan respectively. The sum of written premiums for the top five non-auto insurance lines was 7.92 billion, 1.20 billion, and 5.18 billion yuan respectively. For Guangdong Energy Captive, the written premium was 0.18 billion yuan, with total premiums across all channels amounting to 0.30 billion yuan.
Company Profiles Based on a Decade of Data
Synthesizing ten years of data allows for a qualitative assessment of each company.
CNPC Captive can be categorized as a "scale-oriented leader." It possesses the largest business volume and capital base, with its main challenge lying in the efficiency of converting scale into profit. Its business continued to expand in 2025, yet profits contracted significantly, with pressure from both claims and investment sides. Profits showed signs of recovery at the beginning of 2026.
China Railway Captive can be described as a "profit-quality company." While not the largest in scale, it holds advantages in profit output and standard underwriting metrics, with expense control improvements being more prominent than business expansion. After turning to a loss in early 2026, its combined ratio remained low, but its investment performance weakened simultaneously, meaning its annual profit advantage did not extend into the first quarter.
COSCO Shipping Captive falls under "stable scale, asset expansion with a unique cost structure." In 2025, its insurance revenue grew by a marginal 1.03%, yet net profit increased by 7.71%, with total assets growing over 10% from the previous year-end. Its negative expense ratio renders its combined ratio meaningless for traditional cross-company comparison. A net loss of 0.09 billion yuan in Q1 2026 indicates ongoing quarterly profit volatility.
Guangdong Energy Captive can be classified as a "small-scale company with strong investment performance but weak underwriting." It maintains profitability on a relatively small business base, with its weaknesses concentrated in expense burden and underwriting efficiency, reflected in a combined ratio exceeding 200%. Its strength lies primarily in investment returns, with its annual cumulative investment yield and comprehensive investment yield both at 6.08%, ranking first among the four. Profits continued to grow in early 2026, but the combined ratio climbed further, presenting a unique profile where significant underwriting pressure coexists with relatively high investment returns.
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