The 2025 report card of China Life Property & Casualty Insurance Co., Ltd. (hereinafter referred to as "China Life P&C") serves as a case study in achieving "balance." In its recently disclosed 2025 fourth-quarter solvency report, China Life P&C posted a full-year net profit of 3.976 billion yuan. This figure represents a year-on-year doubling of profits compared to the 1.948 billion yuan net profit recorded in 2024.
Beneath the surface of surging net profits, however, the core driver of performance was not rapid premium expansion but a powerful recovery on the investment side and a hard-won return to underwriting profitability. Data shows that China Life P&C achieved insurance revenue of 112.834 billion yuan in 2025, a mere increase of about 1.5% compared to 111.183 billion yuan in 2024. Against the backdrop of slowing premium growth, the restoration of profitability became particularly critical. The change in the underwriting performance was the focal point of market attention. In 2024, the company had fallen into the mire of underwriting losses with a combined ratio (COR) of 100.48%; one year later, this metric was compressed to 99.56%, falling back below the 100% break-even line. This means that for every 100 yuan of premium income, China Life P&C shifted from a loss of 0.48 yuan last year to a profit of 0.44 yuan. Although the profit margin remains narrow, this slight return to positive territory is notably challenging given the ongoing deepening of auto insurance reforms and the frequent occurrence of natural disasters.
A breakdown of the cost structure reveals that this improvement stemmed more from expense control. The report indicates that China Life P&C's composite expense ratio for 2025 was 25.41%, a decrease of over one percentage point from 26.49% the previous year. In contrast, the composite loss ratio edged up slightly from 73.99% to 74.15%. Faced with the pressure of rigidly increasing claim payouts, securing underwriting profits by reducing expenses became a necessary choice for China Life P&C. If the improvement in underwriting represents cost-cutting, then the explosion on the investment side was the true "decisive factor" behind the profit doubling. In 2025, China Life P&C's financial investment yield reached 4.77%, a figure significantly higher than the 2.94% in 2024 and also markedly better than its three-year average of 2.53%. With premium scale growth stagnating, the nearly 5% investment return became the absolute main contributor to profit enhancement. It must be noted, however, that this profit model, highly reliant on investment returns, often faces sustainability tests in an environment of increasing capital market volatility.
On the capital supplementation front, China Life P&C did not halt its efforts to "replenish blood" despite the profit recovery. In the fourth quarter of 2025, the company successfully issued 4.5 billion yuan in capital supplement bonds, a move that directly boosted its actual capital at the end of the quarter by 2.832 billion yuan compared to the previous quarter. As of the end of 2025, China Life P&C's comprehensive solvency adequacy ratio stood at 218.33%, and its core solvency adequacy ratio was 184.38%, both remaining above the regulatory red line. For a property and casualty insurer of this hundred-billion-yuan scale, sufficient capital is not only the baseline for regulatory compliance but also a crucial "safety cushion" for weathering future business fluctuations and potential risks.
At the personnel level, China Life P&C also welcomed a new helmsman in 2025. The report shows that Li Zhuyong assumed the role of Chairman in April 2025, having previously served as Vice President of the People's Insurance Company (Group) of China Ltd. (PICC Group). Meanwhile, the collaboration between President Huang Xiumei and the new executive team will also shape the future strategic direction of this insurance giant. It is noteworthy that compliance pressures remain ever-present. In the fourth quarter of 2025 alone, China Life P&C's branch offices received 26 administrative penalty notices, with total fines amounting to 5.3095 million yuan. The reasons for penalties continued to focus on industry chronic issues such as "non-authentic financial and business data" and "fake underwriting and claims settlements." How to further strengthen internal controls and compliance while maintaining performance growth remains a challenge that management must confront directly.
Overall, China Life P&C's 2025 was a battle centered on "return"—a return to underwriting profitability and a return to investment value. However, caught between the pincers of narrow underwriting profits and investment volatility, finding more stable endogenous growth drivers is perhaps a more pressing question than simply doubling net profits.
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