The critical time for the rapid transformation of the external environment is the test of the enterprise’s determination. For this reason, what kind of reply will be handed over by China The Pacific Securities Co.Ltd(601099) Insurance Group Co., Ltd. (hereinafter referred to as ” China Pacific Insurance (Group) Co.Ltd(601601) “) which stands in its thirties has attracted much attention. According to the annual report disclosed by the company, the net profit attributable to the shareholders of the parent company was 26.834 billion yuan in 2021, a year-on-year increase of 9.2%. However, the amount and rate of dividends have both decreased In China Pacific Insurance (Group) Co.Ltd(601601) 2021, the annual cash dividend distribution is planned to be 1.0 yuan per share (including tax), with a year-on-year decrease of 23.1% and a dividend rate of 35.9%.
The public’s demand for a healthy and better life is more urgent, and customers’ personalized and diversified requirements for insurance services are constantly improving. Financial supervision puts forward higher requirements for the fine and standardized management of insurance subjects. Next, 601 how to start again in the new 30 years?
life insurance new business value drops continuously
The reform of the insurance industry has entered a critical period, and the value chain is facing a difficult reconstruction process.
In 2021, 601 realized an operating revenue of 440643 billion yuan, including 366782 billion yuan from insurance business, with a year-on-year increase of 1.3%; The net profit attributable to the shareholders of the parent company was 26.834 billion yuan, a year-on-year increase of 9.2%; The embedded value of the group was 498309 billion yuan, an increase of 8.5% over the end of the previous year. The basic earnings per share is 2.79 yuan.
In terms of sectors, the “master” China The Pacific Securities Co.Ltd(601099) Life Insurance Co., Ltd. (hereinafter referred to as “CPIC life”) achieved a net profit of 18.905 billion yuan in 2021, a year-on-year increase of 1.4%. Although the profit performance is commendable, the new business value of the core business segment continues to be under pressure.
According to the annual report, the income of life insurance business in 2021 was 211685 billion yuan, a slight decrease of 0.1% year-on-year; The value of the new business of CPIC life insurance decreased for three consecutive years. The value of the new business of CPIC life insurance in transition was 13.412 billion yuan, a year-on-year decrease of 24.8%. The value ratio of new business was 23.5%, down 15.4 percentage points year-on-year.
“Like other insurance companies, the decline of the new business value of CPIC life insurance is also a phased phenomenon that must be faced in the process of business transformation.” Li Wenzhong, deputy director of the insurance Department of Capital University of economics and trade, said. In 2021, the pressure on the value of new business of listed life insurance companies has become a common phenomenon. The whole life insurance industry is still looking forward to the “bright future” after the transformation China Pacific Insurance (Group) Co.Ltd(601601) for the pressure on the value of new business, it is affected by multiple factors such as the external market situation and the change of business structure.
In terms of sub sectors, CPIC life insurance strengthened the construction of Bancassurance channels, and the premium growth rate was bright. In terms of Bancassurance channels, CPIC life insurance realized an insurance business income of 7.457 billion yuan, of which the new insurance business income was 6.668 billion yuan, a year-on-year increase of 331.3%. The agent channel decreased slightly, and the income of life insurance business was 211685 billion yuan, a year-on-year decrease of 0.1%.
At the same time, the clearing up of CPIC life insurance agents accelerated. According to the annual report, the average number of monthly marketers of CPIC life insurance decreased by nearly 30% year-on-year to 525000 in 2021. However, the manpower of CG (top performance, MDRT level) increased by 170.1% year-on-year in 2021.
The “long voyage action” launched in early 2021 aims to build four strategic cores: team upgrading, track layout, service value-added and digital empowerment. Cai Qiang, general manager (CEO) of CPIC life insurance, said that it was advancing according to the established plan, and the effect was basically in line with expectations.
According to the relevant research reports released by Wang Weiyi, Li Bingting and Chen Xianghe of Ping An Securities, China Pacific Insurance (Group) Co.Ltd(601601) responded to the dilemma of the life insurance industry, innovatively launched the “long voyage action”, upgraded the agent team, restarted value bancassurance and assisted business growth through multiple channels. However, the transformation of life insurance is still in a critical period, and the effect has not yet been reflected.
Li Wenzhong believes that since the implementation of the “long voyage action” for one year, preliminary results have been achieved, and some per capita indicators have been significantly improved. I believe that with the continuous promotion of reform, the effect will be further apparent, and there should be more harvest at the end of the first phase of the project.
auto insurance is under pressure, and non auto business is growing rapidly
In 2021, the industry will face the challenges of the full implementation of the comprehensive reform of automobile insurance, the reconstruction of supply chain and the continuous rise of climate risk. The auto insurance business of China The Pacific Securities Co.Ltd(601099) Property Insurance Co., Ltd. (hereinafter referred to as “CPIC property insurance”) also declined.
From the perspective of property insurance sector, CPIC property insurance realized a net profit of 6.352 billion yuan in 2021, with a year-on-year increase of 21.9%. Insurance business income increased by 3.3% year-on-year to 154611 billion yuan. Among them, the income from auto insurance business was 91.799 billion yuan, a year-on-year decrease of 4.0%.
According to relevant research reports released by Wang Weiyi, Li Bingting and Chen Xianghe of Ping An Securities, China Pacific Insurance (Group) Co.Ltd(601601) 2021 auto insurance growth has been corrected and rebounded rapidly since the fourth quarter of 2021, and the total underwriting profit of leading insurance companies is expected to improve.
From the perspective of non auto insurance business, the quality of non auto insurance business of CPIC property insurance has improved and maintained rapid growth. Revenue increased by 16.8% year-on-year, accounting for 4.7 percentage points, reaching 40.6%; The quality of non auto insurance business has improved and maintained rapid growth. Among them, the comprehensive cost rate was 99.1%, with a year-on-year increase of 0.1 percentage points.
The annual report shows that the viscosity of CPIC property insurance and auto insurance customers continues to increase, promoting the transformation of growth momentum; Non auto insurance achieved underwriting profit, while emerging business areas such as health insurance, liability insurance and agricultural insurance maintained rapid growth. In this regard, Gu Yue, chairman of CPIC property insurance, said that the higher growth of these three categories of business is because the above insurance types are in important areas of national strategy, including rural revitalization, healthy China and improving social people’s livelihood. At the same time, these three businesses are also the weakest areas in the development of China’s insurance industry, so there is a lot of room for growth.
\u3000\u3000 “Based on the above emerging business areas, China Pacific Insurance (Group) Co.Ltd(601601) has made a lot of preliminary preparations and gained a lot in recent years. In terms of business quality, China Pacific Insurance (Group) Co.Ltd(601601) mainly focuses on the following aspects: first, strengthen multi-party interaction to optimize the allocation of internal resources. Second, promote scientific and technological empowerment, open up the underwriting end and claim end, and realize the interaction of underwriting and claim settlement. Third, deepen customer operation, expand the depth of insurance, and realize customer high-quality operation With the high-quality development of auto insurance, we will further drive the development of non auto insurance through customer operation. ” Gu Yue said.
For non vehicle business, Gu Yue said that professional and technical requirements are high. Therefore, from these perspectives, CPIC property insurance has continued to strengthen professional capacity-building in recent years, and the comprehensive capacity of non vehicles has been comprehensively improved. We believe that while deeply cultivating the non vehicle market and expanding the market share of non vehicles, we will further enhance the high-quality development of non vehicles through capacity improvement.
Relevant research reports released by Gaogao and LV Chenyu of open source securities show that property insurance adheres to high-quality development and is expected to realize vehicle and non vehicle two-wheel drive.
fixed income investment decreased and equity investment increased
In the investment sector, in 2021, the China Pacific Insurance (Group) Co.Ltd(601601) total investment income was 93.184 billion yuan, with a year-on-year increase of 10.9% and a year-on-year decrease of 0.2 percentage points. The net investment income was 73.061 billion yuan, a year-on-year increase of 8.8%, and the net investment income rate was 4.5%, a year-on-year decrease of 0.2 percentage points.
The annual report shows that under the guidance of strategic asset allocation, it has further extended the asset duration, actively grasped market investment opportunities, and achieved stable investment performance through flexible tactical asset allocation. By the end of 2021, China Pacific Insurance (Group) Co.Ltd(601601) total assets reached 1946164 billion yuan, an increase of 9.2% over the end of 2020.
In 2021, the proportion of equity investment in China Pacific Insurance (Group) Co.Ltd(601601) ‘s asset allocation increased. Overall, fixed income investment accounted for 75.7%, down 2.6 percentage points from the end of the previous year; Equity investment accounted for 21.2%, an increase of 2.4 percentage points over the end of the previous year, of which core equity accounted for 11.1%, an increase of 0.9 percentage points over the end of the previous year; The growth rate of the group’s net investment assets was 5.4%, down 2.0 percentage points year-on-year.
Fu fan, President of China Pacific Insurance (Group) Co.Ltd(601601) said that from the perspective of China Pacific Insurance (Group) Co.Ltd(601601) ‘s investment strategy, China’s stock market has experienced a relatively large rise for three consecutive years since 2019. Based on the triple pressure faced by China’s economy and the sudden impact of international geopolitical events, China Pacific Insurance (Group) Co.Ltd(601601) 601 starts from the characteristics of liabilities and takes meeting the risk control requirements such as the second generation second phase plan as the premise to maximize the return of long-term investment, Continuously optimize the diversified asset portfolio matching with risk preference, and unswervingly implement the dumbbell asset allocation strategy.
It is understood that China Pacific Insurance (Group) Co.Ltd(601601) implements the “dumbbell” asset allocation strategy. On the one hand, it strengthens the allocation of long-term interest rate bonds to extend the duration of fixed income assets and strengthen the control of reinvestment risk; On the other hand, appropriately increase the allocation of equity assets including unlisted equity to improve the long-term return on investment. The company continues to be cautious in undertaking credit risks, strengthens credit risk control, and actively responds to and prevents credit risks.
So, what is the asset allocation strategy in 2022? For the consideration of equity investment strategy, Fu Fan said that from the perspective of equity investment, the proportion of China Pacific Insurance (Group) Co.Ltd(601601) equity asset allocation has a certain room for improvement. In the first quarter of 2022, the market adjustment range is relatively large, China Pacific Insurance (Group) Co.Ltd(601601) believes that the market adjustment brings more risk release and long-term investment value.
Fu fan also said that China Pacific Insurance (Group) Co.Ltd(601601) remained highly cautious about the overall stock market performance in 2022. Under the guidance of strategic asset allocation, the investment of equity assets will strengthen the disciplinary investment mechanism, strengthen the tactical proportion control, and actively grasp the structural opportunities of the stock market.
