Event: listed insurance companies disclosed the data of original insurance premium income in December 2021. From January to December, the original insurance premium income of life insurance of listed insurance enterprises were respectively: China Life Insurance Company Limited(601628) 620 billion yuan, Ping An Insurance (Group) Company Of China Ltd(601318) 490.3 billion yuan, China Pacific Insurance (Group) Co.Ltd(601601) 209.6 billion yuan, New China Life Insurance Company Ltd(601336) 163.5 billion yuan, The People’S Insurance Company (Group) Of China Limited(601319) 132.7 billion yuan. The A-share listed insurance enterprises totaled 1616 billion yuan, with a year-on-year growth rate of – 0.3%; The original premium income of property insurance of listed insurance companies were: 448.4 billion yuan of China property insurance, 270 billion yuan of Ping An Property Insurance, 153.1 billion yuan of CPIC property insurance and 20.4 billion yuan of Zhong’an online. The total amount of listed insurance companies was 891.9 billion yuan, with a year-on-year growth rate of + 1.0%.
Comments:
Life insurance: the industry as a whole is under pressure, and the repair of the liability side is slow. 1) The cumulative premium performance improved slightly. From January to December 2021, the cumulative growth rate of life insurance premium income of listed insurance enterprises was The People’S Insurance Company (Group) Of China Limited(601319) (+ 3.3%) > New China Life Insurance Company Ltd(601336) (+ 2.5%) > China Life Insurance Company Limited(601628) (+ 1.2%) > China Pacific Insurance (Group) Co.Ltd(601601) (+ 0.6%) > Ping An Insurance (Group) Company Of China Ltd(601318) (- 4.1%) respectively, and the decline continued. 2) The performance of single month premium in December was differentiated. In December 2021, the year-on-year growth rates of insurance companies were China Pacific Insurance (Group) Co.Ltd(601601) (+ 41.9%) > New China Life Insurance Company Ltd(601336) (+ 20.4%) > China Life Insurance Company Limited(601628) (- 0.4%) > Ping An Insurance (Group) Company Of China Ltd(601318) (- 5.0%) > The People’S Insurance Company (Group) Of China Limited(601319) (- 9.8%). CPIC and Xinhua made a sprint in year-end performance, with a bright increase in monthly premium. PICC saw a significant decline in premium growth this month due to the high base in the same period of 2020 and the high increase in premium from October to November 2021. 3) The debt side of the industry is showing an improvement momentum. Ping An Insurance (Group) Company Of China Ltd(601318) in 2021, the new policy premium of personal business decreased by only 2.8% year-on-year, far less than the loss of agents, suggesting that the repair trend of the industry has appeared, but considering ① the overall downturn of consumption and the suppression of insurance demand; ② The popularization of Pratt & Whitney insurance continues to squeeze out commercial insurance; ③ The channel transformation is slow, and the superposition supervision is becoming more and more strict; ④ Due to the serious mismatch between supply and demand of life insurance products and other factors, the momentum of premium growth in the short term is still limited.
Property insurance: premium growth is good and performance continues to recover. 1) The cumulative premium growth rate of traditional insurance enterprises was further repaired, and the monthly premium performance was brilliant. From January to December 2021, the year-on-year growth rate of the original premium income of property insurance of listed insurance enterprises was Zhongan online (+ 21.9%) > China Property Insurance (+ 3.8%) > CPIC property insurance (+ 3.4%) > Ping An Property Insurance (- 5.5%). In December 2021, the year-on-year growth rate of monthly premium of property insurance was China Property Insurance (+ 30.4%) > Ping An Property Insurance (+ 14.2%) > CPIC property insurance (+ 7.7%) > Zhong’an online (- 17.6%), auto insurance recovered, the premium growth momentum of traditional leading insurance companies was good, and the competition pattern stabilized. 2) Auto insurance is on the rise, while non auto insurance keeps developing at a high speed. In 2021, the premium income of China’s property insurance and auto insurance was 255.3 billion yuan, a year-on-year decrease of 3.9%. In December, the monthly premium income of auto insurance was 28.4 billion yuan, a year-on-year increase of 10.3%; The overall performance of non auto insurance business was good, especially the accident health insurance sector continued to increase. From January to December 2021, the premium income of China Property Insurance Italian health insurance was 80.7 billion yuan, a year-on-year increase of 21.9%, and the monthly premium growth in December reached 156.0%.
The short-term pressure continues, and the medium and long-term growth can be expected. Property insurance: auto insurance and non auto insurance have the same frequency resonance, the competition pattern has stabilized, and the advantages of leading insurance enterprises have expanded. One year after the comprehensive reform of auto insurance, the year-on-year growth of premium income has been significantly improved. At the same time, the premium of non auto insurance has continued to increase; In the medium and long term, the scale effect will be further strengthened. Leading insurance companies are expected to further expand their profit space, strengthen competitive barriers and outperform their peers by virtue of their advantages in rates, channels and brands. Life insurance: the liability side is slowly repaired and is optimistic about the long-term development space. In the short term, 2022 has made a good start, the power is insufficient, the supply and demand of the industry are seriously mismatched, and the recovery of the downturn on the liability side is slow; In the long run, with the gradual restructuring of the industry and the increasing demand for health care, the industry will move towards a virtuous cycle of development and growth, and the trend improvement is expected at both ends of assets and liabilities. As of January 19, 2022, the valuation of the sector is at an all-time low. It is expected that the worst time point of the industry will soon pass, and the medium and long-term allocation value can still be optimistic.
Investment suggestion: China Property Insurance and China Pacific Insurance (Group) Co.Ltd(601601) are recommended. As a leader in the industry, China’s property insurance will gain greater advantages in the industry pattern optimized by the comprehensive reform of auto insurance. China Pacific Insurance (Group) Co.Ltd(601601) “long voyage action” has a firm and transformative attitude towards building a professional agent team, which is conducive to the long-term development of the company.
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.
