Event: listed insurance companies disclosed premium data for the first three months of 2022, and the cumulative growth rate of original premiums and corresponding income are ranked as follows: The People’S Insurance Company (Group) Of China Limited(601319) (year-on-year + 14% to 232.4 billion yuan), China Pacific Insurance (Group) Co.Ltd(601601) 601 (year-on-year + 7% to 148.7 billion yuan), New China Life Insurance Company Ltd(601336) (year-on-year + 2% to 64.9 billion yuan), Ping An Insurance (Group) Company Of China Ltd(601318) (year-on-year + 1% to 246.5 billion yuan) and China Life Insurance Company Limited(601628) (year-on-year – 3% to 315.0 billion yuan). The spread of the epidemic throughout the country has dragged down the recovery process of life insurance and the signing premium of new cars.
Comments:
Life insurance: the epidemic is sporadic across the country, but under the effect of extremely low base in the same period and marginal stabilization of team size, new orders in March showed signs of stabilization and improvement at the bottom. In March 2022, the year-on-year growth of the original premium of life insurance in the current month was ranked as follows: CPIC life insurance (+ 10%), China Life Insurance Company Limited(601628) (+ 6%), PICC Life Insurance and health (+ 2%), New China Life Insurance Company Ltd(601336) (- 4%) and Ping an life insurance and health insurance (- 4%). On March 1, Ping An shengshijin’s increasing life insurance product was launched, focusing on the social elite. The product is characterized by amplifying the value brought by time (double insured can be set to extend the value-added cycle) and enhancing the control and flexibility of wealth inheritance. The four product systems of Ping An Life Insurance Royal enjoyment, Shengshi, Zhiying and Ruyi are becoming more and more perfect to meet the health security and wealth management needs of customers at different levels. Since March, the epidemic has spread all over the country, but under the stabilizing effect of the extremely low base number in the same period and the marginal scale of the team, the bottom of the new single month orders in March showed signs of stabilization and improvement: Guoshou increased the ten-year savings business incentive policy, continued the good start policy, and the year-on-year growth rate of single month premium changed from negative to positive compared with February; CPIC life insurance restarted the bancassurance business department. We expect that the contribution of new bancassurance orders in 2022q1 will be close to half of the country. The life insurance team is now showing signs of stabilization. We believe that it is mainly due to the spread of the epidemic situation in various regions, and the intensity of assessment may be loose. We suggest that we still need to pay attention to the sustainability of effective human stabilization. We expect the cumulative NBV growth rate in 2022q1 to be China Life Insurance Company Limited(601628) (- 20%), Ping An Life Insurance and health insurance (- 30%), New China Life Insurance Company Ltd(601336) (- 35%) and CPIC life insurance (- 50%).
Property insurance: PICC and Ping An auto insurance maintained a steady growth in double digits in the first quarter of 2022, with slight fluctuation in a single month in March, and the volume and price rose at the same time. In March 2022, the year-on-year growth rate of the original premium of P & C in the current month is as follows: CPIC P & C (+ 11%), PICC P & C (+ 10%), Ping An P & C (+ 9%). The cumulative year-on-year growth rates of PICC Property Insurance 2022q1 auto insurance and non auto premium were + 10.9% and + 13.2% respectively, and the proportion of non auto business increased by 0.5 percentage points to 58.1% year-on-year. Since October 2021, the year-on-year growth rate of PICC Property Insurance’s single month auto insurance premium has maintained double digits. However, in March 2022, due to the impact of the epidemic throughout the country, the signing premium and renewal of new car insurance were delayed, and the year-on-year growth rate of the company’s single month Auto insurance premium fell to + 4.6%. The cumulative year-on-year growth rates of Ping An Property Insurance 2022q1 auto insurance, non auto insurance and Italian health insurance premiums were + 10.4%, + 2.1% and + 38.5% respectively. Since 2022, the guidance of local regulators on the speed limit of vehicle insurance has remained unchanged, further forcing head insurance enterprises to focus on high-quality home owned vehicle business. The spread of epidemic in various regions reduces the frequency of auto insurance. The trend of hardening auto insurance rates under the impact of major disasters in the second half of 2022 is expected to continue. We expect that the auto insurance underwriting profit of listed insurance companies in 2022q1 will still improve year-on-year. The drag of repeated epidemic on the performance of non auto underwriting remains to be seen, but the overall underwriting profit improvement trend will not be changed.
“3.21” China Eastern Airlines mu5735 aircraft accident has limited impact on the compensation of the industry. According to the CBRC, as of March 29, in terms of property insurance, PICC Property Insurance, CPIC property insurance, Ping An Property Insurance and Guoshou property insurance, which underwrite the aircraft fuselage, paid a total of 116 million yuan in advance to China Eastern Airlines. In terms of life insurance, 11 companies have paid 14 compensation to the families of the victims, with a total amount of 14.85 million yuan. The China Banking and Insurance Regulatory Commission has repeatedly issued documents to guide the insurance industry to do a good job in the “3.21” China Eastern Airlines aircraft accident insurance claim settlement service. We expect the impact of the event to be limited, and pay attention to the compensation optimization, industry reputation effect and the improvement of traffic accident insurance demand.
Investment suggestion: the insurance sector is the first to promote [China Property Insurance], focusing on the continuous repair of the real estate sector and the upward movement of the life insurance sector β Catalysis, recommended [ Ping An Insurance (Group) Company Of China Ltd(601318) ]. As of the closing on April 14, 2022, the average p / EV of A-share listed insurance companies was only 0.54 times and the average Pb was only 1.0 times. After the disclosure of the 2021 annual report, it is basically in line with the previous low market expectations. It is expected that 1q22 profits will still have double-digit downward pressure. However, the new orders and manpower have shown signs of improvement, and there is no need to be further pessimistic. Continue to recommend the Ping An Insurance (Group) Company Of China Ltd(601318) , which continues to improve the fundamentals and has a significant valuation cost performance.
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.
