“Investor Network” Cui Yuechen
On April 17, with the release of Xinhua Insurance's premium income announcement for the first quarter of 2024, the premium income of the five A-share listed insurers for the first quarter of 2024 has all surfaced.
According to statistics, in the first quarter of this year, China Life Insurance, China Insurance, China Taibao, and Xinhua Insurance achieved a total premium income of 1066.423 billion yuan, a slight increase of 0.96% over the same period last year. Due to external factors, the premium income of listed insurers fluctuated in the first quarter. However, China Life Insurance took the lead in performance, injecting a dose of strength into the insurance industry.
Specifically, China Life's performance was the most impressive, showing an upward trend against the market. In the first quarter of this year, China Life achieved a total premium income of 337.6 billion yuan, an increase of 3.2% over the same period last year, making it the listed insurer with the highest growth rate.
China Ping An and China People's Insurance also achieved a slight increase in premium income. Premium income for the first quarter of this year was 264.422 billion yuan and 253,031 billion yuan, respectively, up 1.6% and 1.3% from the same period last year.
On the other hand, premium income from China Taibao and Xinhua Insurance declined. Premium income of 154.177 billion yuan and 57.193 billion yuan was achieved in the first quarter of this year, down 0.18% and 11.7% respectively from the same period last year.
The life insurance business is growing steadily
Affected by factors such as a decline in banking insurance transactions, the life insurance industry is facing a weakening of growth momentum. The overall industry is showing a trend of slowing growth, while China Life Insurance, which is the main business of life insurance, has maintained steady business growth.
According to the data, China Life Insurance's premium revenue for the first quarter of 2024 was 337.6 billion yuan, an increase of 3.2% over the previous year. It is the only company in the industry with premiums exceeding 300 billion yuan.
Compared with peers, Ping An Life's premium revenue for the first quarter was 173.302 billion yuan, an increase of 0.9% over the previous year. The premium income of Taibao Life Insurance, and Xinhua Life Insurance for the first quarter was 91,686 billion yuan, 54.518 billion yuan, and 57.193 billion yuan respectively, down 5.4%, 8.2%, and 11.7% year-on-year respectively.
Behind the steady growth in China Life Insurance's performance, it is inseparable from the upgrading of the sales force and the layout of the new marketing model.
The 2023 annual report shows that in the past year, China Life actively promoted marketing system reform, continuously optimized the structure and quality of the sales force, and greatly increased team production capacity. By the end of 2023, China Life Insurance's total sales force had grown to 694,000 people.
At the same time, China Life is actively building a “Life Insurance+” comprehensive financial ecosystem to enable high-quality development. In 2023, China Life Insurance collaborated to sell financial insurance products to achieve premium income of 23.6 billion yuan, and the number of insurance policies increased 6.5% year-on-year, enriching customer acquisition channels and boosting sales force revenue growth.
Furthermore, China Life actively explores collaboration between insurance and investment businesses, and continues to deepen cooperation with China Life Asset Management Co., Ltd. and China Life Investment Insurance Asset Management Co., Ltd. to innovate and explore new models of insurance investment interaction.
The personal insurance sector continues to recover
Personal insurance is the main source of China's life premium income. Over the past year, China Life Insurance focused on value creation and channel transformation. The business structure was clearly optimized, and individual insurance revenue showed a recovery trend.
According to the annual report, in 2023, China Life Insurance achieved premium income of 641.38 billion yuan, of which the individual insurance sector's revenue reached 501.58 billion yuan, accounting for 78.2%, an increase of 1.9% over the 2022 income of the individual insurance sector of 492,439 billion yuan.
The premium revenue from banking insurance channels, group insurance channels, and other channels was 78.748 billion yuan, 28.154 billion yuan, and 32.898 billion yuan respectively, accounting for 12.3%, 4.4%, and 5.1%, respectively.
In terms of the individual insurance sector, China Life Insurance is promoting the establishment of a personal insurance management system centered on customer management around the concept of “customer capital building team”, promoting the professional upgrading of existing teams, and creating an integrated training system for new hires linked to growth. By the end of 2023, the number of personal life insurance sales people in China reached 634,000, and monthly first-year premiums per capita increased by 28.6% over the same period last year.
In terms of banking insurance channels, China Life Insurance continues to strengthen cooperation with banks, and the scale and value of premiums have increased rapidly. By the end of 2023, the number of account managers in the banking insurance channel reached 23,000, the average quarterly actual manpower increased by 8.5% year on year, and the per capita term delivery capacity increased significantly year on year.
In terms of group insurance channels, the sales team reached 37,000 people in 2023. The proportion of high-performing manpower increased 4.7 percentage points compared to 2022, and production capacity per capita increased steadily.
In terms of other channels, China Life actively develops various types of policy health insurance business. By the end of 2023, the company was operating more than 200 major illness insurance programs, covering nearly 350 million people; undertook more than 70 policy long-term care insurance projects, covering more than 38 million people; and had implemented more than 120 customized commercial medical insurance projects in cities.
Digital transformation strategy layout
China Life Insurance's strategic layout in product innovation, channel expansion, and digital transformation is also worthy of attention.
In the past year, China Life Insurance fully launched the fintech digital project to effectively promote the company's high-quality development with the supply of high-quality technological capabilities. For example, build a distributed data center to ensure the continuity of the company's business; at the same time, build a digital risk control system based on big data analysis to quickly identify and accurately capture key business risks, and achieve real-time dynamic monitoring of risk control barriers.
On the other hand, China Life Insurance continues to strengthen product supply research and enhance product diversity. By the end of 2023, the company had developed and upgraded a total of 196 products.
The above business layout has become the key to supporting the company's profit growth. In 2023, China Life Insurance's net profit attributable to shareholders of the parent company was RMB 21.110 billion. The company distributed cash dividends of RMB 0.43 per share (tax included) to all shareholders, totaling approximately RMB 12.154 billion, with a dividend rate of 57.57%. The increase in the dividend ratio reflects China Life's emphasis on shareholder returns, while showing confidence in future profits.
Pacific Securities's non-bank finance team analysis predicts that from 2024 to 2026, China Life Insurance's revenue will increase 7.44%, 7.47%, and 7.19% year on year, net profit to mother will increase by 23.89%, 17.06%, and 12.67% year on year, and EPS will be 0.93 yuan, 1.08 yuan, and 1.22 yuan per share. Overall, earnings will continue to grow positively over the next two years.
China Life Insurance said in its annual report that the focus of work in 2024 will be customer-centered, persevere in seeking stability, advance stability through progress, break ahead, achieve the “three breakthroughs” of steady development, value addition, and team improvement, strengthen excellent service, promote integration, and cost reduction, promote steady growth in the company's size, value, efficiency and high-performing manpower over a long period of time, and continuously consolidate its dominant position in the market.
As far as the industry as a whole is concerned, the growing demand for multi-level, high-quality health, medical care, and pension has provided and created huge market space and growth potential for the development of the insurance industry. As China Life Insurance's first quarter results conference is about to be held at the end of this month, “Investor Network” will continue to pay attention to the report. (Produced by Thinking Finance) ■