According to the 21st Century Business Herald, it is understood that a relevant document regarding the pricing mechanism of the predetermined interest rates for life insurance products in mainland China may be released soon. The industry anticipates a decrease in the predetermined interest rates for life insurance products in the next quarter.

The report cites an industry insider indicating that the upper limit of the predetermined interest rate for newly filed plain insurance products is expected to drop from 2.5% to 2%; the upper limit for newly filed participating insurance products is anticipated to decrease from 2% to 1.5%; and the upper limit for newly filed universal insurance products' minimum guaranteed interest rate is projected to decline from 1.5% to 1%.

Industry insiders point out that the reduction in predetermined interest rates for life insurance corresponds to the trend of declining long-term interest rates. This helps mitigate the risk of "interest margin loss" and establishes a dynamic adjustment mechanism linked to market interest rates, further improving the efficiency and timeliness of adjusting predetermined interest rates and enhancing the asset-liability matching level of insurance companies.

"The pricing interest rate adjustment mechanism" refers to the predetermined interest rates being linked to and dynamically adjusted based on market interest rates. This mechanism sets a benchmark for predetermined interest rates, which will reference the loan market quoted rates (LPR) for terms over five years, the benchmark interest rates for five-year term deposits, and the long-term interest rates such as the yield on ten-year government bonds. Once the triggering conditions are met, each insurance company will adjust product pricing in a timely manner based on market principles.

Earlier, there were reports that mainland regulatory authorities gathered insurance companies to discuss adjusting the predetermined interest rates again by the end of March.