The performance of the liability side is sluggish, and the net profit attributable to the parent is under pressure. In 2021, the net profit attributable to the parent company was AIA (YoY + 28.5%), Taiping (YoY + 14.7%), CPIC (YoY + 9.1%), PICC (YoY + 7.8%), Xinhua (YoY + 4.6%), Guoshou (YoY + 1.3%) and Ping An (yoy-29.0%). Affected by the negative growth of new business + the negative contribution of operation deviation, the growth of embedded value of insurance enterprises slowed down except AIA.
The transformation of life insurance has yet to dawn, and new orders continue to be under pressure. 1) New orders + nbvm dragged down NBV's performance. In 2021, NBV AIA (YoY + 21.7%), Taiping (YoY + 3.6%), Guoshou (yoy-23.3%), Ping An (yoy-23.6%), CPIC (yoy-24.8%), Xinhua (yoy-34.9%) and PICC (yoy-40.6%); 2) The scale of agent team continues to shrink, including Taiping Life (YoY + 1.0%), Taibao life (yoy-29.9%), Xinhua (yoy-35.8%), Guoshou (yoy-39.0%), Ping An Life (yoy-41.4%) and PICC Life (yoy-55.1%); Bancassurance channel contributes performance increment. 3) The continuation rate decreased, the surrender rate increased, and the remaining marginal balance increased negatively year-on-year, with Ping An (yoy-2.0%), Guoshou (yoy-0.2%), CPIC (yoy-0.8%), Xinhua (yoy-0.5%) and PICC (yoy-1.2%).
The concentration of the property insurance industry has increased, and the advantages of head insurance enterprises have emerged. In 2021, the premium income of property insurance was Taiping Finance (YoY + 5.0%), PICC Finance (YoY + 3.5%), CPIC Finance (YoY + 3.3%) and Ping An Finance (yoy-5.4%). Head insurance companies effectively controlled the comprehensive cost rate through excellent structure and strict risk control. In 2021, the comprehensive cost rates of PICC finance, Ping An finance, CPIC finance and Taiping finance were 99.5%, 98.0%, 99.0% and 105.9% respectively, with a year-on-year increase of + 0.6pct, - 1.1pct, + 0pct and + 2.0pct respectively. The auto insurance business of listed insurance companies has maintained steady growth after September 21, with Italian health insurance and liability insurance contributing the main increment of non auto premiums, and the comprehensive cost rate of insurance companies has differentiated.
The decline of long-term interest rate and the fluctuation of equity market put pressure on the net / total investment return of insurance enterprises. Net return on investment Guoshou / Taiping / PICC / CPIC / AIA / Xinhua / Ping An yoy + 4bps / - 10bps / - 20bps / - 20bps / - 30bps / - 50bps; Total return on investment Xinhua / PICC / Taiping / CPIC / Guoshou / AIA / Ping An yoy + 40bps / + 0bps / - 5bps / - 20bps / - 32bps / - 90bps / - 220bps.
Outlook: 1) life insurance: decline in agent size + weakening demand + high base + repeated outbreaks. We judge that listed insurance companies have a good start, and NBV has a year-on-year decrease of 20% to 50%; The high point of the premium base has passed, and Q2 is expected to usher in a year-on-year inflection point, but the transformation is still the main theme of the industry in the medium and short term. It is expected that the size of the management team is expected to reach the bottom in 2023. 2) Property insurance: property insurance premiums are expected to grow steadily in 22q1, and the year-on-year growth rate in Q2 is expected to decrease slightly. The turning point of auto insurance has reached, and the premium growth rate of head insurance enterprises is expected to be 2-3 percentage points higher than that of the industry; Competition in the non auto industry is intensifying, and it is expected that the comprehensive cost rate of non auto insurance of head insurance enterprises is expected to be effectively controlled. At present, the industry is at a historical low valuation. It is suggested to pay attention to China Property Insurance and AIA.
Risk tips: policy risk, interest rate risk, market fluctuation risk and repeated epidemic.
