Event: listed insurance companies disclosed the premium data for the first two months of 2022. The cumulative growth rate of original premiums and the corresponding income are as follows: The People’S Insurance Company (Group) Of China Limited(601319) (17% to 159.2 billion yuan), China Pacific Insurance (Group) Co.Ltd(601601) (6% to 104.8 billion yuan), New China Life Insurance Company Ltd(601336) (5% to 46.4 billion yuan), Ping An Insurance (Group) Company Of China Ltd(601318) (1% to 183.2 billion yuan) and China Life Insurance Company Limited(601628) (- 5% to 241.2 billion yuan). The volume and price of auto insurance premiums rose simultaneously, and the decline of new life insurance policies continued.
Comments:
Life insurance: under the dislocation of the Spring Festival, the growth rate of new orders and value in February picked up slightly, but it is still difficult to change the decline. In February 2022, the growth rate of the original monthly premium of life insurance was ranked as follows: PICC Life Insurance and health insurance (19%), CPIC life insurance (15%), New China Life Insurance Company Ltd(601336) (11%), China Life Insurance Company Limited(601628) (- 3%) and Ping An Life Insurance and health insurance (- 5%). PICC Life Insurance continued to rely on single premium to drive the year-on-year high growth of new orders. The growth rate of single month regular payment changed from – 13.5% in January to 11.7%, but there was still a 10.2% regular payment gap in the first two months. Leading insurance companies rely on Bancassurance channels to quickly make large-scale premiums and underpin the annual performance target with volume and price. Ping An New Bancassurance team has expanded in an orderly manner. The company expects the number of exclusive teams to reach 2000 at the end of the year, which is a useful attempt in the continuous downturn of individual insurance; CPIC life insurance restarted the bancassurance business department, and it is expected that the contribution of new bancassurance orders in 2022q1 will be close to half of the country. Taibao Jinfu · hejiahuan insurance products are planned to be listed. The highlight of the products is to provide additional insurance for old customers, provide 8 / 13 / 18 payment methods, and give double compensation for 20 specific serious diseases. We expect the cumulative growth rate of NBV in the first two months to be China Life Insurance Company Limited(601628) (- 19%), Ping An Life Insurance and health insurance (- 30%), PICC Life Insurance (- 30%), New China Life Insurance Company Ltd(601336) (- 34%) and CPIC life insurance (- 46%).
At present, the main contradiction of life insurance products is the contradiction between the diversified needs of policyholders and unbalanced and insufficient products and services. There is still room for improvement and improvement in the customer-centered goal. The CBRC issued a notice on expanding the pilot scope of exclusive commercial endowment insurance. From March 2022, the pilot area of exclusive commercial endowment insurance will be expanded to the whole country. We expect the deregulation of the third pillar product side policy to be expected. During the national two sessions, “Huimin insurance” and “endowment insurance” became the key words discussed by the participating experts. It is worth noting that the epidemic has been spreading all over the country since March 2022, which may drag down the recovery process of new life insurance orders.
Property insurance: the premium of traditional leading insurance companies has a good growth momentum and continues to lead the market. In February 2022, the growth rate of the original premium of P & C in the current month is as follows: CPIC P & C (23%), Ping An P & C (18%), PICC P & C (13%) and Zhong’an online (3%). In February, the China Banking and Insurance Regulatory Commission issued the detailed rules for the implementation of the measures for the management of non life insurance business reserves of insurance companies, which aims to improve the scientificity, rationality and systematicness of the regulatory system, make it more difficult to adjust human behavior under the new regulations, and benefit the leading insurance enterprises with standardized operation. The cumulative year-on-year growth rates of PICC Property Insurance, auto insurance and non auto premiums were 14.6% and 12.8% respectively, and the proportion of non auto business decreased by 0.4 percentage points to 54.7% year-on-year. Since October 2021, the growth rate of PICC Property Insurance’s single month auto insurance premium has maintained a double-digit month by month, and has accelerated month by month. We believe that the main comprehensive reform has been carried out for more than one year, the pressure of premium growth has slowed down, the market competition pattern has improved, and the average auto insurance premium has shown signs of recovery. The guidance of local regulators on the speed limit of vehicle insurance remains unchanged, which further forces the head insurance enterprises to focus on high-quality home owned vehicle business. The epidemic situation spreads all over the country and reduces the frequency of vehicle insurance. We expect that the underwriting profit of vehicle insurance of listed insurance enterprises in 2022q1 will still improve year-on-year.
Investment suggestion: the insurance sector is the first to promote [China Property Insurance]. We believe that the fundamentals of the property insurance sector are better than those of the life insurance sector in 2022. The bottom of life insurance has yet to be ground, and the inflection point of the property insurance sector has reached. From January to February 2022, the national economy recovered better than the market expected. In the first two months of 2022, the social zero grew by 6.7% year-on-year, 2.8 PCT faster than the average growth rate in the two years of 2021, demonstrating the resilience of residents’ consumption. It is still worth looking forward to the recovery of the demand side of subsequent premiums. In the short term, affected by the sharp fluctuations in the capital markets outside China, the P / EV valuation of listed insurance companies is at a historically low level. China property insurance is the first choice, followed by Ping An Insurance (Group) Company Of China Ltd(601318) and China Pacific Insurance (Group) Co.Ltd(601601) .
Risk tips: 1) the economic recovery is not as good as expected, restraining the demand for insurance; 2) The decline of long-term interest rate and the oscillation of equity market affect the investment side; 3) The transformation effect of insurance enterprises was less than expected.
