The scale is stable! As of January 20, the annual premium income of five A-share listed insurance companies in 2021 has been fully released. On the whole, although the annual performance of 2021 has not been disclosed, according to the performance in the first three quarters and the actual operation in the fourth quarter, industry insiders predict that the overall net profit of listed insurance companies in 2021 is expected to maintain a slight increase.
Since last year, the market performance of A-share insurance sector has been sluggish. Institutional analysts said that with the relatively certain growth expectation of insurance business this year, the share price of insurance sector has been repaired after the beginning of the year. Under the trend of the rebound of agent channels, the arrival of the inflection point of the auto insurance industry and the shock and rebound of long-term interest rates, a number of brokerage research institutions are firmly optimistic about the rebound of insurance stocks at the bottom this year.
the annual premium stabilized and the expected performance increased slightly
According to the data, in 2021, five listed insurance companies achieved a total premium income of 2487523 billion yuan, a slight increase of 0.03% year-on-year.
Industry insiders said that under the influence of policies such as clearing up the deficiency of life insurance manpower, standardizing sales, and making the comprehensive reform of automobile insurance beneficial to the people, the insurance industry faced great pressure to stabilize the scale in 2021, and the premium income of some companies continued to decline. Thanks to the advantages of brand and channel, listed insurance companies have stabilized their scale in the face of huge industry pressure, which is not easy.
However, the premium performance of listed insurance companies has been differentiated. The premium income of China Pacific Insurance (Group) Co.Ltd(601601) , China Life Insurance Company Limited(601628) , New China Life Insurance Company Ltd(601336) and The People’S Insurance Company (Group) Of China Limited(601319) increased by 1.72%, 1.16%, 2.48% and 3.67% respectively year-on-year; Ping An Insurance (Group) Company Of China Ltd(601318) premium income decreased by 4.65% year-on-year.
Ge Yuxiang, an insurance analyst, said that since the second quarter of 2021, affected by the lack of manpower, the early consumption of customer demand and the substitution of local Huimin insurance products, the growth rate of new premiums of listed life insurance has decreased significantly. It is expected that the new business value of listed insurance enterprises will decline by more than 20% in 2021. At the same time, the sluggish addition of insurance agents and the decline in product attractiveness have led to a lower than expected recovery momentum of guaranteed business, and there is still a gap of nearly 30% of the core regular premium compared with that before the epidemic.
Another insurance analyst said that listed property insurance companies faced the pressure of comprehensive auto insurance reform last year, and auto insurance premiums generally showed a downward trend. However, in terms of non auto insurance business, PICC Property Insurance and The Pacific Securities Co.Ltd(601099) property insurance showed the effect of earlier transformation, stabilizing the overall premium income. Ping An Property Insurance‘s non auto insurance business showed weak performance, resulting in a year-on-year decline in the overall premium.
At present, the annual net profit of listed insurance companies in 2021 has not been announced. According to the data, the net profits of the five major insurance companies showed “four increases and one decrease” in the first three quarters of last year. Except for the negative growth of net profits caused by Ping An Insurance (Group) Company Of China Ltd(601318) stepping on thunder China Fortune Land Development Co.Ltd(600340) , the net profits of the other four listed insurance companies increased positively to varying degrees due to factors such as changes in accounting estimates.
Insiders said that the focus of listed insurance companies in the fourth quarter of last year was generally adjusted to the preparation for a “good start” this year, and their business performance was flat. Therefore, based on the performance of the first three quarters, it is expected that the overall net profit of listed insurance companies will maintain a slight increase in 2021, and the five companies will continue to maintain the trend of “four increases and one decrease”.
the logic of insurance growth in 2022 is basically established
At present, the market is more concerned about whether the listed insurance companies can get out of the dilemma and resume the growth trend in 2022?
In terms of life insurance business, the key point of premium growth lies in the performance of agent channels. China Securities Co.Ltd(601066) said in the research report that at present, the total manpower of listed insurance enterprises has fallen by 30%. Although the rhythm of each company is different, it is predicted that there is little room for listed insurance enterprises to continue “clearing up”. The impact of regulatory policies on the industry is expected to be differentiated in different companies, and the manpower growth rate of listed insurance enterprises with leading channel advantages is expected to bottom out and pick up this year.
China Securities Co.Ltd(601066) believes that taking the lead in mastering more “professional and professional” agents will become the driving force for the growth of new business value of insurance companies in the future. “Professionalization and specialization” put more emphasis on the company’s empowerment, professional training and systematic management of agent groups. Insurance enterprises with relatively leading channel and product fundamentals have the first mover advantage.
In terms of property insurance, a number of securities companies analyzed in the research report that the turning point of auto insurance has arrived, and it is expected that the growth rate of auto insurance premium will change from negative to positive this year and enter a steady growth trend; In terms of non auto insurance business, it is expected that liability insurance, agricultural insurance, accident insurance and health insurance will continue to drive the high growth of non auto insurance. On the whole, the scale effect is significant, and the “strong and strong” of leading insurance enterprises is expected to continue.
insurance stocks hit the bottom and can rebound
In 2021, the market performance of the insurance sector continued to be depressed, ranking second to last among the numerous secondary sectors of Shenwan A shares. By the end of last year, the insurance sector (Shenwan secondary industry classification) had fallen 39% compared with the beginning of last year, the largest annual decline since 2009. By the end of last year, the average p / EV valuation of listed insurance companies had reached a new low, and the valuations of Ping An Insurance (Group) Company Of China Ltd(601318) , China Life Insurance Company Limited(601628) , China Pacific Insurance (Group) Co.Ltd(601601) and New China Life Insurance Company Ltd(601336) were all at historical lows.
Analysts from a number of market institutions are clearly optimistic about the insurance sector and believe that insurance stocks have allocation value, and the share price is expected to hit the bottom and rebound. With the opening of the wide credit cycle, the growth rate of social finance is expected to start to pick up, insurance stocks are expected to benefit as a whole, and the performance of individual stocks will be differentiated due to their performance.
Since the beginning of the year, insurance stocks have shown signs of rebound. As of yesterday’s closing, the A-share insurance sector index (Shenwan class II) has risen 4.21% this year, ranking 12th among the 125 Shenwan class II sectors, with a net active purchase amount of 3.84 billion yuan. Ping An Insurance (Group) Company Of China Ltd(601318) is the best performing stock in this round of rise, with an increase of 5.40%; China Pacific Insurance (Group) Co.Ltd(601601) , New China Life Insurance Company Ltd(601336) followed, rising 2.69% and 1.85% respectively.
Institutions are more optimistic about listed property insurance companies. In the research report, a number of securities companies strongly supported listed property insurance stocks and believed that their main rising logic includes four aspects: first, property insurance products are rigid demand and are less sensitive to external economic fluctuations; Second, the fundamentals of large listed property insurance companies are solid, and the operating profit results of non auto insurance will be prominent in the next few years; Third, the scientific and technological strategic deployment of leading property insurance companies is clear, and the digitization process is fast; Fourth, large property insurance companies have high reserves for outstanding claims and have strong controllability over future profits and roe volatility.
