Huaxi Securities: Insurers' Profits Hit New High Despite High Base, Total Investment Income Sees Significant Growth

Stock News11-07

The combined net profits attributable to shareholders of five A-share listed insurers reached RMB 426.039 billion in the first three quarters of 2025, marking a 33.5% year-on-year increase despite a high base in the same period last year. By the end of Q3 2025, their total investment assets amounted to RMB 20.26 trillion, up 10.4% from the beginning of the year.

**Record Profits Amid High Base** The five insurers reported robust profit growth, with China Life Insurance (+60.5%), New China Life Insurance (+58.9%), PICC (+28.9%), CPIC (+19.3%), and Ping An (+11.5%) leading the gains. In Q3 alone, their combined net profits surged 68.3% YoY to RMB 247.847 billion, driven largely by investment returns. By end-Q3, their combined net assets rose 10.3% year-to-date to RMB 2.311 trillion.

**Strong NBV Growth in Life Insurance, Improved COR in P&C** Life insurers saw notable growth in New Business Value (NBV), with PICC Life (+76.6%), New China Life (+50.8%), Ping An (+46.2%), China Life (+41.8%), and CPIC (+31.2%) posting gains, fueled by premium growth and higher value margins. Bancassurance channels performed well, with CPIC and New China Life reporting 52.4% and 66.7% YoY growth in new premiums, respectively.

In P&C, premium income grew steadily, with PICC (+3.5%), Ping An (+7.1%), and CPIC (+0.1%) benefiting from stable auto insurance growth. Combined ratios (COR) improved across the board: PICC P&C (96.1%, -2.1pp YoY), Ping An P&C (97.0%, -0.8pp YoY), and CPIC P&C (97.6%, -1.0pp YoY), reflecting better underwriting profitability.

**Investment Income Boosted by Equity Market Rally** Total investment income rose sharply, with China Life (+40.7%), New China Life (+40.3%), PICC (+36.6%), CPIC (+26.8%), and Ping An (+19.5%) benefiting from the equity market uptrend. While net investment yields dipped due to low-interest-rate pressures, total/comprehensive yields improved on stronger stock performance.

**Investment Outlook** Life insurers are mitigating spread risks through dynamic rate adjustments and product shifts, while P&C insurers are enhancing underwriting profits via cost controls. The sector remains undervalued, with the insurance index trading at a PB of 1.42x as of November 6, 2025, near a 10-year low.

**Risks Include** Macroeconomic slowdown, prolonged low interest rates, equity market volatility, and natural disasters.

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