Yuanbao Inc. (YB.US) achieved a leap from losses to an annual profit of 1.3075 billion yuan in just six years. In 2021, it set an industry record for the speed of completing a 1 billion yuan Series C financing round, establishing itself as a leading internet insurance platform.
After three years of losses and a turnaround to profitability in 2024, the company successfully listed on the Nasdaq in April 2025.
Although it earned a substantial 1.3075 billion yuan profit in its first year as a public company, this financial success has been accompanied by persistently high user complaints. Issues such as "targeting the elderly," "misleading insurance sales," and "unauthorized automatic payments" have consistently plagued the company. Regulatory penalties and reputational challenges have become serious issues that Yuanbao cannot avoid following its IPO.
Substantial Profit of 1.3 Billion Yuan On March 18, Yuanbao Inc. (YB.US) released its unaudited financial results for 2025. The data shows that by the end of 2025, the company's total operating revenue reached 4.3732 billion yuan, a year-on-year increase of 33.1%. Net profit was 1.3075 billion yuan, representing a significant increase of 51.0% compared to the previous year.
Looking at a longer time frame, Yuanbao's growth rate is remarkable in the industry. The company was founded in 2019 by Fang Rui, former Vice President of NetEase Group, and officially launched its internet insurance intermediary platform in 2020. Revenue grew from 385 million yuan in 2021 to over 2 billion yuan in 2023, reaching a new level by 2025.
Evidently, Yuanbao's revenue increased more than tenfold within just five years.
However, behind this rapid revenue growth was a three-year period of losses. From 2021 to 2023, Yuanbao reported losses of 1.218 billion yuan, 435 million yuan, and 333 million yuan respectively, accumulating nearly 2 billion yuan in total losses. A turnaround occurred in 2024 when the company returned to profitability, achieving a net profit of 436 million yuan. In 2025, profits surged further to 1.308 billion yuan.
Clearly, Yuanbao accomplished a dramatic reversal in profitability within just two years.
Furthermore, the scale of its operations continued to expand. By the end of 2025, the number of new policies issued reached 30.66 million, a year-on-year increase of 36.7%. In the fourth quarter alone, approximately 7.9 million new policies were issued, up 34.5% year-on-year. As of the end of the third quarter of 2025, Yuanbao's cash reserves stood at 3.75 billion yuan, an increase of 82.3% year-on-year.
Data from third-party consultancy Frost & Sullivan indicates that, based on first-year premiums in 2023, Yuanbao was the second-largest distributor in China's life insurance market, firmly establishing its position in the internet insurance sector.
Driven by these improving fundamentals, Yuanbao listed on the Nasdaq in April 2025 with an offering price of $15 per share, officially joining the ranks of US-listed insurance technology companies.
AI-Driven Efficiency and Quality Improvement Yuanbao's rapid rise is essentially a successful application of the "AI + Internet" model within the insurance industry.
By the end of 2025, Yuanbao had built a library of over 4,900 AI models and analyzed more than 5,700 user tags. Research and development personnel accounted for 70% of its workforce, with the AI team making up over 10% of total staff. This demonstrates that AI is the core driver of Yuanbao's growth. Specifically, the company has used AI to restructure the entire insurance distribution process, building strong barriers for traffic conversion through technology and carving out a new path in the traditional insurance market through extreme efficiency.
In 2025, Yuanbao's revenue primarily came from two segments: insurance distribution services and system services. Revenue from insurance distribution services was 1.4468 billion yuan, up 33.8% year-on-year, while system service revenue reached 2.9227 billion yuan, an increase of 33.2%. These figures further validate the company's growth logic of "technology enabling business, and business in turn supporting technology."
On the product side, over 99% of Yuanbao's business focuses on short-to-medium term insurance, deeply penetrating the inclusive health insurance market with products like short-term medical insurance and critical illness insurance. These products inherently feature "low barriers, quick decision-making, and high repurchase rates," making them suitable for internet traffic conversion and serving as another engine for the continuous growth in new policies.
Simultaneously, by leveraging AI and big data technologies, Yuanbao has broken through traditional channel limitations, achieving broad reach between products and users. The core logic of this model is "precise matching." Through thousands of media models, user models, and product models, the company analyzes user behavior data to accurately push insurance products to potential customers.
For customer acquisition, Yuanbao extensively utilizes third-party platforms such as short video apps, mini-programs, and QR codes on charging piles. It leverages the high traffic in these scenarios to achieve rapid user引流 (diversion). However, high growth has been accompanied by high investment. By the end of 2025, Yuanbao's sales and marketing expenses reached 2.2172 billion yuan, accounting for 73.02% of total operating costs. This indicates that Yuanbao is still in a stage of capturing traffic channels through large-scale advertising investment, and economies of scale have not yet fully offset marginal costs.
It is crucial to remember that the primary purpose of technical services is to support the business. Based on this, Yuanbao employs an inclusive insurance strategy to broaden its user base.
The traditional insurance industry has long had an implicit "preference for the healthy" barrier, often excluding individuals with chronic diseases, pre-existing conditions, and those over 60 years old. Yuanbao, however, has extended the maximum enrollment age for many products to 80 years and even launched products covering people aged 0 to 99. It has also significantly relaxed occupational restrictions, allowing more ordinary people with underlying health conditions to obtain coverage.
This differentiated strategy has successfully unlocked the vast "non-standard risk" market traditionally overlooked by conventional insurers.
Mired in Controversy Over "Targeting the Elderly" The consequence of the above strategies has been a persistently high volume of user complaints. Yuanbao is now facing a severe test regarding its compliance and operational practices.
As of March 23, on the "Hei Mao投诉" platform alone, complaints against Yuanbao have accumulated to a staggering 9,409. A significant number of these complaints point to "unauthorized charges," "automatic deductions," and "misleading sales tactics," with the elderly population being disproportionately affected.
One complaint dated February 7th detailed that the complainant's father had 8,891.7 yuan in insurance premiums deducted automatically by the Yuanbao platform without his knowledge. The complainant alleged that Yuanbao exploits the vulnerabilities of elderly individuals, such as illiteracy or unfamiliarity with smartphones, by guiding them through steps to activate insurance services. This was accused of involving false advertising, predatory terms, and essentially seizing the hard-earned money of laborers. The complainant strongly demanded a full refund of all premiums and called for relevant authorities to intervene on behalf of ordinary citizens.
Although the merchant marked the complaint as "processed," a follow-up comment on February 9th stated, "Yuanbao did not refund the full premium amount, maliciously deceiving the elderly. Farmers work hard for their money; we implore the relevant departments to uphold justice for the people." The current status of this complaint is listed as "completed."
In-depth analysis reveals that Yuanbao's marketing page designs are often misleading, particularly for elderly users who may have poor eyesight or lack proficiency in using smartphones.
For instance, advertisements prominently featuring "1 yuan for the first month," "free to claim," or "just a few yuan per month" are widely distributed on platforms like short video apps and mini-programs. However, the actual premium costs and automatic renewal rules are often not clearly disclosed. Key terms and conditions are frequently placed in inconspicuous locations or require multiple swipes to view. In charging mini-programs, the payment confirmation button for charging services might be small and blurry, while the "confirm" button for insurance ads is large and prominent. After clicking confirm, there is insufficient risk disclosure or explanation of policy terms. The information filling process uses a simplistic, slide-through "fool-proof" operation that easily leads to mistaken policy purchases by the elderly.
When faced with complex interactive flows involving pop-ups, authorizations, or password-free payments, many elderly users, due to high cognitive barriers, struggle to discern the implications. They tend to follow the on-screen prompts by clicking "next" repeatedly, ultimately completing the insurance application unknowingly.
Although Yuanbao has delivered impressive financial results since its listing, this success appears to have come at the cost of neglecting the insurance industry's core principle of "integrity first." The future of Yuanbao may depend on finding a balance between capital-driven profit pursuit and the ethical application of technology, aiming for a win-win scenario of sustained business growth alongside an improved public reputation.
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