Looking ahead to 2026, Huachuang Securities believes that an accelerated transformation of dividend insurance could drive life insurance sales to exceed expectations. From the demand perspective, following the asymmetric downward adjustment of the assumed interest rate in September 2025, the appeal of the "call option" feature of dividend insurance has significantly increased. Concurrently, the active equity market in 2024-2025 has helped dividend insurance achieve higher realization rates, creating a positive feedback loop for sales. From a liquidity standpoint, the magnitude of deposit migration may surpass expectations; dividend insurance provides a medium- to long-term wealth management tool, and its "fixed + floating" settlement attribute may offer a path for low-risk-preference customers to hedge against interest rate risk. In the property and casualty insurance sector, the firm remains optimistic about the positive impact of the "报行合一" policy on the industry's combined ratio (COR). The main views of Huachuang Securities are as follows.
Industry Overview: Cumulative Premium Growth for P&C and Life Insurance Continues to Slow. From January to November 2025, the insurance industry recorded original premium income of 5.7629 trillion yuan, a year-on-year increase of 7.6%, but a deceleration of 0.4 percentage points from the previous period. Within this total, premiums for life insurance (including health and accident insurance from P&C companies) amounted to 4.4206 trillion yuan, up 9.2% year-on-year, while P&C premiums reached 1.3423 trillion yuan, up 2.5% year-on-year; the cumulative growth rates for both segments showed a decline. Life insurance premiums for the first eleven months were 3.3874 trillion yuan, with a cumulative year-on-year increase of 11.5%, slowing by 0.5 percentage points compared to the previous month. Both health and accident insurance premiums grew, with health insurance at 943.9 billion yuan (up 2.4% year-on-year) and accident insurance at 89.2 billion yuan (up 2.1% year-on-year); the growth rate for health insurance saw a slight sequential improvement. In terms of payouts, cumulative claims paid from January to November totaled 2.2061 trillion yuan, accounting for 38.3% of the original premium income, an increase of 1.3 percentage points sequentially. Specifically, the payout ratio for life insurance was 30.1% (up 0.7 ppts sequentially), while for property and casualty insurance it was 65.3% (up 2 ppts sequentially).
Life Insurance Companies: Monthly Decline in Life Insurance Premiums Narrows, Focus Expected to Gradually Shift from Year-End to 2026's "Good Start". From January to November 2025, life insurance companies achieved original premium income of 4.1472 trillion yuan, a year-on-year increase of 9.1%. Within this, life insurance premiums grew by 11.5% year-on-year, while health insurance declined by 0.1% and accident insurance fell by 9.7% year-on-year. Although the cumulative growth rate for life insurance continued to moderate, the monthly premium growth rate showed improvement, with November's life insurance premiums down 2.3% year-on-year, a sequential improvement of 2.9 percentage points. The short-term impact of the assumed interest rate cut on sales is gradually diminishing, and the operational focus is likely shifting towards preparing for a strong start in 2026; since early December, various insurance companies have launched promotional products for the upcoming year. From January to November 2025, the cumulative new premium payments for policyholder investment accounts, primarily universal insurance, increased by 2.5% year-on-year, with the cumulative growth rate edging up 0.2 percentage points sequentially; the single-month figure for November showed a 7.9% year-on-year increase. The active equity market is boosting risk appetite, and "fixed + floating return" insurance products are expected to gain an advantage in the "fixed income plus" arena. Premiums for the separate accounts of unit-linked insurance increased by 10% year-on-year in November alone, although monthly growth rates have been volatile, significantly influenced by base effects.
Property and Casualty Insurance Companies: Growth Rates for Most Lines of Business Declined Sequentially, While Health Insurance Growth Continued to Improve. From January to November 2025, property and casualty insurance companies generated original premium income of 1.6157 trillion yuan, up 3.9% year-on-year, with the growth rate slowing by 0.1 percentage point sequentially. By line of business, auto insurance accounted for 52%, health insurance for 13.5%, agricultural insurance for 9%, liability insurance for 8%, and accident insurance for 3%. Cumulative auto insurance premiums for the first eleven months reached 843.2 billion yuan, up 3.1% year-on-year, slowing by 0.1 percentage point sequentially, partly affected by automobile market sales. In November alone, auto sales reached 3.43 million units, up 3.4% year-on-year but down 5.4 percentage points sequentially; within this, new energy vehicle sales in November were 1.82 million units, up 20.5% year-on-year and increasing 0.6 percentage points sequentially. Cumulative premiums for non-auto insurance lines grew 4.8% year-on-year for the January-November period, slowing by 0.1 percentage point sequentially. The year-on-year growth rates for specific lines were as follows: accident insurance +11.2% (down 0.4 ppts sequentially), health insurance +11.4% (up 0.8 ppts sequentially), liability insurance +3.9% (flat sequentially), and agricultural insurance +2.1% (down 0.4 ppts sequentially).
Asset Changes: As of the end of November 2025, total assets in the insurance industry reached 40.6 trillion yuan, an increase of 13.2% from the end of the previous year, with contributions expected from both the asset and liability sides. Specifically, assets of life insurance companies stood at 35.75 trillion yuan, up 13.3% from year-end; assets of property and casualty insurance companies were 3.15 trillion yuan, up 8.5%; reinsurance company assets were 852.3 billion yuan, up 2.9%; and assets of insurance asset management companies were 140 billion yuan, up 9.6%. As of end-November 2025, the net assets of the insurance industry reached 3.68 trillion yuan, an increase of 10.7% from the end of the previous year.
Recommended Stock Order: China Life Insurance (H-shares), China Pacific Insurance, PICC P&C, China Taiping. Risk Warning: Policy changes, intensification of natural disasters, persistent decline in long-term interest rates, volatility in equity markets.
