Core view:
The growth rate of property insurance continues to pick up, and the improvement of leverage is expected to improve roe From January to February, the original premium scale of PICC finance / Ping An finance / Taibao finance was 91.8 billion yuan / 47.5 billion yuan / 31 billion yuan, with a year-on-year growth rate of 13.6% / 11% / 15.7% respectively, an increase from 13.8% / 8.2% / 12.7% in January, which is expected to be mainly driven by the continuous recovery of automobile insurance. From the perspective of business structure: (1) the monthly growth rate of PICC auto insurance is 14.9%, which has expanded for five consecutive months after turning from negative to positive. The monthly growth rate of 21m10-22m2 PICC auto insurance is 6.5% / 9.5% / 10.3% / 14.5% / 14.9% respectively, which is mainly due to the decline of the average vehicle premium base after the comprehensive reform one year ago, while the growth of motor vehicle ownership and the increase of commercial insurance coverage rate promote the stable growth of auto insurance premium. (2) From January to February, the cumulative growth rate of PICC non auto insurance was 12.8%, down from 13.2% in January, mainly due to the high base in the same period last year. Looking forward to the whole year of 2022, with the return of double-digit growth of auto insurance and the maintenance of double-digit growth of non auto insurance, it is expected to promote the return of double-digit growth of property insurance premium, and the growth of premium is expected to improve the leverage of property insurance companies (premium leverage and investment leverage), promote roe and boost valuation.
The competition pattern of auto insurance of leading companies continues to improve, and the Matthew effect is prominent after the comprehensive reform. According to the industry data disclosed by the China Banking and Insurance Regulatory Commission, as of January 2022, the market share of PICC auto insurance was 33.3%, up + 0.8 percentage points year-on-year, and increased by 0.47 percentage points month on month compared with the end of 2021. It returned to the level at the end of 2014 and reversed the downward trend of market share in the past decade. It is expected that the main reason is the comprehensive reform to reduce the cost rate and guide the industry to return to rational competition, while large insurance enterprises rely on their brands The comprehensive advantages such as offline services have realized the natural increase of market share, and the market share of leading insurance enterprises is expected to increase slowly.
After the decline of the base, the growth rate of life insurance picked up, and the worst time point is expected to have passed. From January to February, the growth rates of original life insurance premiums of Ping An / Guoshou / CPIC / Xinhua were 1.5% / - 5% / 2.3% / 5.2% respectively, which was improved from - 3.4% / - 5.3% / - 1.1% / 3.6% in January last year, mainly due to the small upsurge in sales of old products caused by the switching of definitions of old and new serious diseases in January last year, but the premium in subsequent months decreased after demand overdraft in advance. At present, the liability side of life insurance is still at the bottom. Whether the repeated epidemic leads to the upgrading of epidemic prevention measures and the decline of middle-class income, or the decline of the scale of agents, it is difficult to see a large increase in the new single premium in the short term, but we must also see the demand for pension and medical security after the acceleration of population aging The tightening of Internet insurance supervision, the adjustment of insurance guarantee fund and other long-term positive factors conducive to large insurance enterprises continue to pay attention to the turning point of stabilizing the scale of agents.
The property insurance industry ushered in an operating inflection point, and the significant improvement of the beneficial asset side of life insurance maintained the "buy" rating of the industry. The year-on-year growth rate of premium in the property insurance industry has continued to improve, and it is expected that the leading insurance companies will benefit from the strengthening of competitive advantage and the improvement of competition pattern. The current valuation is at a relatively low level. We think there is more room for repair, while the valuation of life insurance and the position of public funds are at the historical freezing point level, showing an improvement attitude on the liability side, and the asset side is obviously changing in a positive direction, We suggest continuing to pay attention to insurance stocks, and individual stocks are recommended to pay attention to: China Property Insurance (H), China Life Insurance Company Limited(601628) (A / h), Ping An Insurance (Group) Company Of China Ltd(601318) (A / h), AIA (H), China Pacific Insurance (Group) Co.Ltd(601601) 601 (A / h), New China Life Insurance Company Ltd(601336) (A / h).
Risk tip: the economic recovery did not meet expectations, and the yield of 10-year Treasury bonds continued to decline.
