Recently, the five major A-share insurance companies have disclosed the premium data in the first month of the year. The reporter of the daily economic news noted that the total premium of the “old three” of property insurance in January was 114.2 billion yuan, a year-on-year increase of 11.96%. Specifically, PICC Property Insurance, Ping An Property Insurance and CPIC property insurance realized premiums of 60.4 billion yuan, 32.8 billion yuan and 21 billion yuan respectively in January, with a year-on-year increase of 13.8%, 8.2% and 12.9% respectively.
Compared with the obvious recovery of property insurance, the liability side of life insurance is still in the doldrums. In January 2022, the total premium of PICC Life Insurance and New China Life Insurance Company Ltd(601336) five major life insurance companies was about 444.2 billion yuan, a year-on-year decrease of 0.18%, continuing the downturn of last year. Among them, the top three premium companies China Life Insurance Company Limited(601628) , Ping An Life Insurance and CPIC life insurance realized premiums of 207.2 billion yuan, 98.6 billion yuan and 55.9 billion yuan respectively, with a year-on-year decrease of 5.34%, 0.6% and 1.06% respectively.
The sluggish performance of the life insurance industry at the beginning of the year is in line with market expectations. Soochow Securities Co.Ltd(601555) analysts pointed out in the research report that the transformation of insurance enterprises’ business strategies makes the industry “a good start” lack of driving force and dull performance, which also reflects that the pressure on the liability side of the industry has not been lifted. The specific analysis is as follows: first, the overall consumption downturn suppresses the demand for insurance; Second, the popularization of inclusive insurance continues to squeeze out commercial insurance; Third, the channel transformation is slow and the supervision is becoming more and more strict; Fourth, due to multiple factors such as serious mismatch between product supply and demand, the space for premium improvement may still be limited in the short term.
The first month premium of the three life insurance companies increased negatively
According to the statistics of the premium data of the five listed insurance companies by the reporter of the daily economic news, the total premium of China Life Insurance Company Limited(601628) , Ping An Insurance (Group) Company Of China Ltd(601318) , The People’S Insurance Company (Group) Of China Limited(601319) , China Pacific Insurance (Group) Co.Ltd(601601) , New China Life Insurance Company Ltd(601336) in January reached 572 billion yuan, a year-on-year increase of only 1.86%. Specifically, the premium income of China Life Insurance Company Limited(601628) , Ping An Insurance (Group) Company Of China Ltd(601318) , The People’S Insurance Company (Group) Of China Limited(601319) , China Pacific Insurance (Group) Co.Ltd(601601) , New China Life Insurance Company Ltd(601336) was 207.2 billion yuan, 136.5 billion yuan, 115.5 billion yuan, 76.9 billion yuan and 35.8 billion yuan respectively, with a year-on-year increase of – 5.3%, 1.2%, 17.9%, 2.3% and 3.6% respectively.
Behind the opening year premiums of the five listed insurance companies, the negative growth of premiums of several life insurance companies was a drag. Among them, the top three premium companies China Life Insurance Company Limited(601628) , Ping An Life Insurance and CPIC life insurance realized premiums of 207.2 billion yuan, 98.6 billion yuan and 55.9 billion yuan respectively, with a year-on-year decrease of 5.34%, 0.6% and 1.06% respectively.
A market observer told reporters that the poor sales of the “good start” new orders this year is related to many factors such as the difficulty of sales operation under the interference of the epidemic, economic fluctuations and the lack of attraction of insurance products. In the past, the growth of life insurance business depended on the growth of manpower. In recent years, the scale of industry agents has continued to shrink. At the same time, the overall structure of agents has not improved significantly under the industry transformation. At present, the development of life insurance companies is facing many difficulties.
The problems faced by the current development of life insurance industry are not achieved overnight. Cheng Yonghong, general manager of Taiping Life Insurance, believes that the problems behind it mainly involve the supply and demand of the industry. On the supply side, the demographic “dividend” of the industry disappears, and the environment for increasing staff becomes difficult. On the demand side, customers’ basic needs are gradually met, and the competition gradually enters the “Red Sea”.
“It is expected that the new policy premium will be under pressure due to the high base in the same period, the decline of team size, the weak release of security demand and the advance of the time point of the Spring Festival. The increase of renewal premium failed to fill the decline of the new policy.” Kaiyuan Securities said that considering that the business operation rhythm is affected by the Spring Festival holiday, it is expected that the probability of year-on-year improvement of the value of new orders in February is low. In addition, since the main products are mostly large-scale products, the value rate is relatively low, and the value of new orders is year-on-year or under pressure, it is expected that the value of new orders of various insurance enterprises will be in the range of – 20% to – 30% year-on-year in the first quarter of 2022.
However, the premium of PICC Life Insurance in January was 46.6 billion yuan, a year-on-year increase of 30.2%. In this regard, some brokerage analysts believe that the single payment business of The People’S Insurance Company (Group) Of China Limited(601319) life insurance and health insurance continued to make efforts, which led to a significant increase in new single premiums in January, thus leading the industry. In addition, New China Life Insurance Company Ltd(601336) January premium was 35.9 billion yuan, a year-on-year increase of 3.8%.
The first month premium of property insurance “old three” increased by 11.96%
Different from the life insurance business, the premiums of listed property insurance companies showed obvious signs of recovery in January. The total premium of PICC Property Insurance, Ping An Property Insurance and CPIC property insurance was 114.2 billion yuan, a year-on-year increase of 11.96%. Among them, the premium of PICC Property Insurance in January was 60.4 billion yuan, a year-on-year increase of 13.7%. Ping An Property Insurance and CPIC property insurance realized premiums of 32.8 billion yuan and 21 billion yuan in January, with a year-on-year increase of 8.3% and 12.9% respectively.
“The year-on-year premium income of the property insurance sector was significantly better than previously expected, mainly due to the year-on-year higher than expected premium of automobile insurance.” According to the analysis of open source securities, the auto insurance premium of PICC Property Insurance in January was 27.58 billion yuan, with a year-on-year increase of 14.5%. The year-on-year growth rate has increased continuously since the pressure of comprehensive auto insurance reform was relieved in October 2021. The main reason is that the leading insurance enterprises have obvious advantages in service, pricing and data after comprehensive auto insurance reform, the market pattern is optimized and the concentration of auto insurance market is improved. In addition, The sales volume of new energy vehicles increased or increased the average vehicle premium to a certain extent.
In addition to the higher growth rate of auto insurance business, the leading non auto business of property insurance maintained an overall growth trend. In January 2022, PICC Property Insurance and Italian health insurance realized a premium income of 16.9 billion yuan, a year-on-year increase of 15.1%; The premium income of agricultural insurance was 5.338 billion yuan, a year-on-year increase of 16.8%; The premium income of liability insurance was 4.496 billion yuan, a year-on-year increase of 16.9%.
In the secondary market, the performance of the insurance sector continues to be depressed. From a fundamental point of view, when the inflection point of the insurance liability side is not reached, many securities companies pointed out in recent research reports that the marginal improvement of the asset side may become the investment logic in the next stage.
Ping An Securities believes that from the asset side, the margin of real estate policy is eased, credit risk is mitigated, the expectation of interest rate hike in the United States continues to rise, and the yield of long-term bonds may rise; At the same time, industry valuation and institutional positions are at the bottom of history. Driven by the current market style switching, hedging demand and absolute return allocation demand, it is recommended to pay attention to the rebound of the insurance sector catalyzed by the improvement of asset side and undervaluation in the short term. According to the calculation of Kaiyuan securities, if the long-term interest rate is expected to rise to 3%, the real estate chain risk resolution is expected to rise, superimposed with EV growth, the valuation repair space is expected to exceed 20%.
