[Epoch Times November 12, 2021](Epoch Times reporter Liu Yi comprehensive report) Since the beginning of this year, the insurance sector in the mainland stock market has fallen by 38%, ranking first among all A-share sectors.
According to a report by the Mainland Securities Daily on November 12, the 38% drop in the insurance sector was behind the overall weakening of the insurance industry. Moreover, in the first three quarters, public funds all reduced their holdings of five major insurance stocks.
Specifically, on the premium side, the total premiums of the five major listed insurance companies in the first three quarters fell by 0.97% year-on-year, and the growth rate of premiums stagnated, and there were no signs of improvement in the third quarter. On the investment side, affected by factors such as lower interest rates and increased equity market volatility, The total investment income of the five major listed insurance companies in the first three quarters fell by 0.12% year-on-year; in terms of operating profit, the total net profit of the five major listed insurance companies in the first three quarters fell 7.1% year-on-year, and the third quarter fell sharply by 36% year-on-year.
Overall, as of November 11 this year, the insurance index fell by 38.04%.
The report quoted Xinhua Insurance’s vice president Li Yuan’s analysis as saying that there are three reasons for the continued sluggishness of the life insurance industry this year. “Put forward more stringent requirements; third, the traditional personal marketing strategy of the insurance industry is difficult to adapt to the changes and changes in the market.
Xu Jinghui, the former chairman of Pacific Life, believes that with the continuous decline in the size of salespersons and new policy premiums in the past two years, the bancassurance business has grown but it is difficult to make profits due to high costs, and it is difficult for the company to provide customer service and continuous customer operations.
In addition, the Chinese Communist Party’s regulatory authorities issued the “Notice on Further Regulating Internet Personal Insurance Business of Insurance Institutions” (new regulations) at the end of October, causing a large number of insurance companies to lose their qualifications to continue to sell some Internet products.
“Securities Daily” reported on November 11 that in 2020, Internet personal insurance premiums reached 211.1 billion yuan. After the implementation of the new regulations, all insurance premiums such as participating insurance, universal insurance and investment-linked insurance, which had a relatively high premium in Internet channels, will be suspended. In addition to the sale, some “Internet celebrity hot models” products that have received widespread market attention and are vigorously promoted by some insurance companies will also be removed from the shelves. In 2020, the total premiums of universal insurance, participating insurance, and investment-linked insurance accounted for up to 65% of the Internet life insurance business. The above three types of insurance are easy to sell on the Internet due to their weak protection attributes, strong financial management attributes, and simple clause design.
Commentator Wen Xiaogang told The Epoch Times that the biggest reason for the decline in the performance of the insurance industry is the decrease in market demand. The biggest reason for the decrease in market demand is that people have less money. Insurance, car loans, children’s education, etc. must be paid before it is possible to get insurance. The reason is that the mainland’s economic downturn has reduced people’s income, and the insurance industry has been dragged down by the economic downturn.
Editor in charge: Lin Congwen
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