recently, the premium data of five A-share listed insurance companies in the first quarter of 2022 were released in full. The total premium income of the five insurance companies in the first quarter “exceeded trillion”, totaling 1007474 billion yuan, a year-on-year increase of 3.52%, an increase from 2.64% in the same period last year
it is worth mentioning that the first quarterly report of listed insurance companies in 2022 will be disclosed next week, and the “report card” of insurance companies in the first quarter can also be seen from the aspects of premium income and investment income. According to the analysis of insiders, since this year, the weak performance of the equity market has dragged down the investment performance of insurance enterprises in the first quarter, putting pressure on their net profit; However, in the context of “steady growth”, banks and real estate stocks with heavy positions of insurance capital have positive expectations in the industry, which is helpful to the valuation repair of listed insurance companies. At present, the allocation value and defense advantages of the insurance sector are prominent. Since the second quarter of this year, “smart money” has increased its holdings of several insurance stocks
life insurance growth differentiation
In the first quarter of this year, the five major A-share listed insurance companies China Life Insurance Company Limited(601628) , The People’S Insurance Company (Group) Of China Limited(601319) , Ping An Insurance (Group) Company Of China Ltd(601318) , China Pacific Insurance (Group) Co.Ltd(601601) , New China Life Insurance Company Ltd(601336) respectively realized the original insurance premium income of 315 billion yuan, 232375 billion yuan, 246477 billion yuan, 148732 billion yuan and 64.890 billion yuan.
In terms of segmentation, the growth of life insurance and property insurance business continues to differentiate. The life insurance business of the above five companies achieved a total premium income of 701704 billion yuan, which is the “highlight” of the total premium income, but it only increased by 0.28% year-on-year China Life Insurance Company Limited(601628) , Ping An Life insurance premiums in the first quarter increased by – 2.75% and – 2.27% respectively year-on-year; CPIC life insurance and New China Life Insurance Company Ltd(601336) premium income increased by 4.23% and 2.36% year-on-year respectively; The premium income of PICC Life Insurance increased by 17.94% year-on-year. Although the growth rate is far ahead, the income scale is relatively low.
At the same time, the property insurance business performed well. In the first quarter of this year, the premium income of PICC Property Insurance, Ping An Property Insurance and CPIC property insurance increased by 12.24%, 10.34% and 13.84% year-on-year respectively, with double-digit growth. The insurance premium income was 152139 billion yuan, 73.018 billion yuan and 49.282 billion yuan respectively, totaling 274439 billion yuan, a year-on-year increase of 12.01%.
liability end material continues to be under pressure
Insiders generally believe that in the short term, the pressure on the liability side of insurance enterprises, especially life insurance companies, will continue. Under the influence of product supply to be transformed, the decline of agent scale and the continuous epidemic, the growth of life insurance business of listed insurance enterprises in the first quarter was limited, which was in line with expectations. “At present, the life insurance industry is still facing difficulties, and it will take time for the ‘inflection point’ to appear.” An insurance industry analyst said.
Everbright Securities Company Limited(601788) research report points out that under the background of continuous reform of the life insurance industry, listed life insurance companies have launched protection products represented by increased life insurance in the first quarter of 2022, providing targeted and high-quality services guided by customers. After the painful period of transformation, the value of new orders and new businesses is expected to rise. Affected by the epidemic, the growth rate of auto insurance premiums in the property insurance industry has slowed down periodically, and the development of non auto premiums has made steady progress. If the epidemic is effectively controlled, with the cost advantage, the fundamentals of the property insurance industry will remain good for a long time.
From the investment side, industry insiders believe that in the first quarter of this year, the capital market continued to fluctuate due to the turbulence of the external environment, repeated epidemics and other factors, which may cause some pressure on the insurance investment side China International Capital Corporation Limited(601995) said that due to the large fluctuation range of the capital market in the first quarter of 2022, it is expected that most listed companies in the insurance industry will be dragged down by the investment side, and the net profit in the first quarter will decline to a certain extent, and the overall net profit of the industry will decline by 15.5% year-on-year. Some analysts also said that in the long run, if insurance funds increase equity investment during the market downturn, it may pave the way for excess returns in the later stage.
share price at an all-time low
Since this year, the share prices of the five major A-share listed insurance companies have fallen, with double-digit declines. The continued downturn in share prices has become a “heartache” for many market participants investing in insurance stocks. However, analysts believe that the current stock prices of listed insurance companies are at historical lows, with a high margin of safety and long-term allocation value.
Wang Weiyi, an analyst at Ping An Securities, said that at present, the industry valuation and institutional positions are at the bottom of history. It is expected that insurance companies with clear development strategy and firm reform will take the lead in the valuation repair. It is suggested to pay attention to the sectors brought by the recovery of market sentiment β quotation.
According to Xu Kang, an analyst at Huachuang securities, the share prices of listed insurance companies have fallen far beyond their performance, and the valuation level has been at a historical low. Especially considering the dividend level and continuous repurchase and other factors, under the current low valuation and stable fundamentals, the allocation value and defense advantages of the insurance sector are prominent.
It is worth mentioning that some people in the industry expect that under the background of steady growth, insurance companies with high investment in real estate and bank stocks are expected to carry out valuation repair.
Since the second quarter of 2022, “smart money” has “cleaned up” many insurance stocks. Data show that from April 1 to 20 this year, northbound capital increased its holdings of The People’S Insurance Company (Group) Of China Limited(601319) , New China Life Insurance Company Ltd(601336) , China Pacific Insurance (Group) Co.Ltd(601601) 3 China Yangtze Power Co.Ltd(600900) shares, 3660000 shares and 704100 shares respectively. On April 21, the three major A-share indexes fluctuated again, adding positions against the market in the north, with a net purchase of Ping An Insurance (Group) Company Of China Ltd(601318) 238 million yuan.
