Interim results released!The value of China Life’s new business increased rapidly, and the agent team bottomed out and stabilized

On August 23, China Life Insurance (601628), the leading life insurance company, announced its interim performance report.

According to the interim report, in the first half of 2023, China Life achieved premium income of 470.115 billion yuan, a year-on-year increase of 6.9%, a record high for the same period in history. Business indicators remain industry-leading.

In the first half of 2023, as my country’s economy and society fully resume normal operation, market demand will gradually recover. However, the external situation is complicated and the foundation for the continued recovery and development of the domestic economy is still not solid.

China Life adheres to the business strategy of “stabilizing growth, emphasizing value, optimizing structure, strengthening the team, promoting reforms, and preventing risks”, adheres to the fundamentals of insurance, adheres to high-quality development, and actively seizes opportunities for industry recovery and development. The overall operation has made steady progress. The leading position in the market continued to be solid.

Emphasis on value leads the growth of new business value to accelerate

Against the backdrop of life insurance transformation, China Life adhered to the theme of high-quality development, insisted on value leadership, and seized market opportunities. The insurance business showed a strong growth trend.

As of June 30, 2023, the company’s total assets reached 5.64 trillion yuan, and its total premium income was 470.115 billion yuan, a year-on-year increase of 6.9%, a record high for the same period in history, and its premium scale ranked first in the industry. The intrinsic value is 1,311.669 billion yuan, ranking first in the industry.

While maintaining strong growth in volume, the insurance business continued to optimize its business structure.

　　In the first half of the year, new policy premiums were RMB 171.213 billion, a year-on-year increase of 22.9%; first-year regular premiums were RMB 97.418 billion, a year-on-year increase of 22.0%. Among them, the first-year regular premiums of 10 years and above were 38.957 billion yuan, a year-on-year increase of 28.9%, and the proportion of first-year regular premiums increased by 2.13 percentage points year-on-year. The business structure has been significantly optimized.In the first half of the year, the new business value continued to lead the industry, reaching 30.864 billion yuan, a year-on-year increase of 19.9%. In the first quarter of this year, the growth rate of new business value has just turned from negative to positive, +7.7% year-on-year, which shows that the company’s new business value is recovering rapidly.

Stabilize the sales force, continue to optimize and innovate the multi-channel business model

China Life continued to promote the transformation of agency channels. In the first half of 2023, the personal insurance segment will always adhere to the strategy of “effective teams driving business development”, focus on the “sales channel strengthening project”, and focus on the two key reform directions of “professional upgrading of existing teams” and “exploration of new marketing models”. Promote the reform of the individual insurance marketing system, and accelerate the professionalization and professional transformation and upgrading of the team.

The “4.0 system of normal operation of personal insurance team building” was steadily promoted, strengthened the technical support for team building, and improved the overall business performance of the team. The “Zhongxin Plan” focuses on the optimization of growth and education, and continuously optimizes the entrance of recruitment.

The team size has bottomed out and stabilized. As of June 30, 2023, the individual insurance sales force will be 661,000, which is basically the same as the end of 2022. The situation continued to improve, and both the number and proportion of high-performing people increased; the production capacity of the sales force increased significantly, and the monthly first-year regular premiums per capita increased by 38.1% year-on-year.

Bank insurance channel is a major bright spot. In the first half of 2023, the total insurance premiums of the bancassurance channel reached 62.066 billion yuan, a year-on-year increase of 45.7%. Insist on deepening structural transformation, improve mid-to-long-term product allocation, and optimize business structure significantly. The first-year regular premiums reached 17.294 billion yuan, a year-on-year increase of 59.2%. The first-year regular premiums of 5 years and above reached 7.527 billion yuan, accounting for 43.52% of the first-year regular premiums, an increase of 11.20 percentage points year-on-year. Renewal premiums reached 25.641 billion yuan, accounting for 41.31% of the total channel premiums.

The bancassurance channel continued to strengthen the professionalization and technological capacity building of the customer manager team, and the quality of the team was steadily improved. As of June 30, 2023, there will be 23,000 bank insurance channel account managers, the quarterly average active manpower has increased by 13.8% year-on-year, and the per capita regular delivery capacity has increased significantly year-on-year.

The scale and efficiency of the group insurance channel were coordinated to promote the steady development of various businesses. In the first half of 2023, the total insurance premiums of the group insurance channel reached 15.923 billion yuan; among them, the short-term insurance premiums were 14.39 billion yuan. As of June 30, 2023, the sales force of the group insurance channel will be approximately 37,000, of which the proportion of high-performance personnel will increase by 4.6 percentage points compared with the end of 2022.

Continue to promote the development of Internet insurance business, and provide customers with high-quality service experience through online and offline integration and online direct sales. In the first half of 2023, the premium income of Internet insurance business under the regulatory caliber reached 53.68 billion yuan, a year-on-year increase of 38.1%.

Actively build a “life insurance +” comprehensive financial ecosystem to empower the main business

In the first half of 2023, China Life Insurance’s collaborative sales of China Life’s property and casualty insurance business achieved premiums of 11.856 billion yuan. Through the sales of property insurance products, it enriched customer contacts, effectively boosted the company’s customer acquisition, and promoted sales team performance, retention and revenue growth.

The company’s collaborative sales of the China Life Pension Insurance Company’s corporate annuity business increased the first-year account scale and the commercial pension business scale was 2.045 billion yuan.

The first-year regular premium income of China Guangfa Bank as an agent of China Life Insurance Company Bancassurance reached 1.612 billion yuan, a year-on-year increase of 42.0%.

Actively explore the synergy between insurance and investment businesses, continue to deepen cooperation with China Life Asset Management Co., Ltd. and China Life Investment Insurance Asset Management Co., Ltd., and continue to innovate and explore new investment interaction models in investment project promotion and joint customer development.

In addition, starting from meeting the diversified needs of customers, the company cooperates with property insurance companies and China Guangfa Bank to carry out various customer business activities to provide customers with one-stop, all-round high-quality financial and insurance service solutions.

Make every effort to promote the comprehensive health and elderly care service system

In the face of the aging trend, insurance companies have increased their coverage of comprehensive health and senior care services. China Life is also speeding up the deployment of ecological construction of healthy elderly care.

In the first half of this year, in terms of “insurance + health”, China Life fully integrated internal and external high-quality resources, continuously improved its health management service capabilities, and created a high-quality, efficient, online and offline health management service system. As of June 30, 2023, China Life’s big health platform has more than 100 service items, covering seven categories of health management service items, including health checkup, health consultation, health promotion, disease prevention, chronic disease management, medical services, and rehabilitation care. The cumulative number of registered users has increased by more than 10% compared with the end of 2022, ranking in the forefront of the industry.

In terms of “insurance + pension”, the company accelerated the deployment of China Life’s health care industry, increased the supply of pension services, and built a development centered on “city center” institutional pensions, supplemented by “suburban” institutional pensions, home pensions and community pensions model. The company accelerated the integration of existing health care resources through the China Life Pension Fund, which was funded and established. In the first half of the year, it added a pension industry layout in 6 key cities, and carried out home-based pension pilots in 5 cities.

In the next stage, China Life will continue to focus on the main business of insurance, comprehensively improve the company’s comprehensive health and comprehensive elderly care ecological integration capabilities and platform influence, create a closed loop of “product-service-payment”, and build the company’s core competitiveness of “product + service” , to promote the transformation of the company from risk compensation to full-chain risk management, and make the company an important force for improving the social security system, improving people’s livelihood and well-being, and improving people’s quality of life.

Maintain strategic focus and adhere to asset-liability matching management

In the first half of 2023, the fixed income rate will be adjusted downward after a brief rise at the beginning of the year. The low interest rate environment has not improved significantly, and high-quality assets are still scarce; the stock market continues to fluctuate, and the industry differentiation is obvious. Facing the complex and ever-changing market environment, China Life Insurance Company has always maintained strategic focus, adhered to asset-liability matching management, and under the guidance of strategic asset allocation, it has flexibly managed tactical asset allocation and actively seized market opportunities.

Fixed-income assets adhere to the dumbbell-shaped allocation strategy, and seize the short-term window of interest rate rebound at the beginning of the year to increase the allocation of long-term bonds. The overall equity asset position remained stable, and continued to promote balanced allocation and structural optimization. Alternative assets actively expand project reserves, innovate investment models, and stabilize the allocation scale.

As of June 30, 2023, China Life’s investment assets reached 5,421.819 billion yuan, an increase of 7.0% from the end of 2022. Among the main varieties, the bond allocation ratio increased from 48.54% at the end of 2022 to 49.66%, the time deposit allocation ratio changed from 9.59% at the end of 2022 to 8.04%, and the debt financial product allocation ratio changed from 8.98% at the end of 2022 to 8.72%. The allocation ratio of funds and funds (excluding money market funds) will change from 11.34% at the end of 2022 to 11.06%.

In the first half of 2023, China Life Insurance Company achieved a net investment income of 96.958 billion yuan, with a net investment yield of 3.78%. Mainly affected by the decline in the realized income of equity varieties in the open market, the total investment income will be 87.601 billion yuan in the first half of 2023, and the total investment yield will be 3.41%. This is also an important reason for the decline in the total profit of life insurance business. After considering the net changes in the fair value of available-for-sale financial assets included in other comprehensive income in the current period, the comprehensive investment yield was 4.23%, an increase of 48 basis points over the same period in 2022.

future outlook

In the long run, my country’s personal insurance industry is still in a period of important strategic opportunities, and high-quality development is the primary task of the industry. Chinese-style modernization draws a grand blueprint for China’s economic and social development. my country’s per capita GDP is moving towards a moderately developed country, the middle-income group will continue to expand, and the social security system will be more complete. The demand for management will accelerate, providing a huge market space for the personal insurance industry.

As market players accelerate the layout of new tracks, cultivate new drivers, and accelerate the exploration of specialization, digitalization, integration, and ecology, the industry is in an important period of transformation and upgrading of traditional drivers and new drivers are ready to go. Industry supervision implements the national strategy of actively responding to the aging population and the construction of a healthy China, and has introduced a series of important support policies, which will guide the industry to further return to the origin of insurance and improve risk protection capabilities.

China Life stated that in the second half of 2023, it will adhere to the general tone of the work of seeking progress while maintaining stability, adhere to the business strategy of “steady growth, value, structure optimization, strong team, reform, and risk prevention”, maintain strategic focus, and focus on stability Development, overall management of assets and liabilities, key reforms and risk prevention and control, strengthen customer management and product diversification strategies, strive to achieve stable annual total premiums, rapid growth in new business value, stable sales force and quality improvement, key areas Innovative breakthroughs have promoted the company’s high-quality development to achieve new results.

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