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At the 2024 Lujiazui Forum on "Silver Economy and Retirement Finance," Zhao Yonggang, executive director and president of China Taiping Insurance (Group) Co., Ltd., proposed that retirement finance is not only the basic infrastructure for improving the multilevel retirement insurance system, but also the supporting force for the development of retirement service and industry. The insurance industry can enrich the supply of commercial retirement insurance for individuals, help with retirement fund management through capital allocation, and focus on the layout of retirement services.
First of all, in terms of enriching the supply of individual commercial retirement insurance, Zhao Yonggang believes that the development of retirement finance first needs to solve the problem of where the money comes from. With the increasing degree of population aging, the supply of public services and the sustainable development of the social security system are facing huge challenges. Retirement will inevitably shift from being dependent on the state to being dependent on society and individuals, so promoting the development of individual commercial retirement insurance is the primary task of building a multilevel retirement security system.
"Under the guidance of policies, the insurance industry has developed tax-deferred commercial retirement insurance, exclusive commercial retirement insurance, personal retirement pension and other policy-related products, and continues to serve residents' retirement fund accumulation by combining traditional annuity insurance, incremental life insurance and other strong retirement attribute insurance products." In Zhao Yonggang's view, compared with other financial products such as bank financial management and fund savings, insurance products have unique advantages in long-life risk management. By using actuarial technology based on life tables, personalized and differentiated retirement fund planning can be provided to different groups and different stages of life, with various forms such as lifelong payment, guaranteed payment, and flexible payment. It can also resist a variety of life risks for retirement security plans, whose professional value is irreplaceable.
At the same time, the insurance industry can play a professional cross-cycle asset allocation ability and continue to contribute to retirement fund management. "As a pioneer in the retirement field, besides enriching commercial retirement insurance products to help accumulate retirement wealth, insurance companies can also rely on their professional ability of cross-cycle asset allocation to continuously contribute positively to the investment and management of basic retirement insurance, enterprise annuity, occupational annuity, and commercial insurance funds." Zhao Yonggang pointed out. Insurance companies have comparative advantages in absolute income acquisition and large asset allocation capacity of major categories, and their management ability of long-term funds and balanced product risks and returns is very suitable for retirement fund management needs.
He believes that the insurance industry can play to its advantage in long-term funds and actively lay out retirement services. With the extension of life expectancy and the aggravation of the phenomenon of declining birthrates, there is an urgent need for people to accumulate retirement funds and retirement services. Retirement institutions rely on their long-term large asset scale to strategically layout retirement industry, provide high-quality retirement services, and build a retirement ecological closed loop of products, investment, and services. As of the end of 2023, the industry has built and operated more than 30 retirement communities, with more than 28,000 operating beds. Different leading insurance companies have adopted different layout paths based on their different strategic positions and resource endowments. More self-built and self-operated retirement communities are in the future for more top-tier companies. Currently, the main insurance companies' retirement communities have been basically built and entered the long-term operation phase.
On the one hand, customers can lock in high-quality health resources during the accumulation period of retirement funds and receive one-stop connection during the withdrawal of funds, enhancing customer satisfaction. On the other hand, because the long cycle of the retirement industry naturally matches the characteristics of insurance funds, laying out the retirement industry is also conducive to asset-liability management of insurance companies, as well as exploring the transformation from retirement payout to retirement service payout.
Regarding the difficulty of making a profit in retirement communities, Zhao Yonggang said that retirement services need to uphold long-termism and that institutions need to focus on core capabilities. "Specifically, the first is to precisely position the customer base, do a good job of customer targeting, focus on customer real needs, and do a good job of service system construction to effectively drive the occupancy rate. At the same time, establish differentiated advantages, operate well, improve customer experience, and let retirement change from a cost center to a new source of company profit. In addition, pay attention to strengthening talent construction." (Lanjinger news, Shiyu, shiyu@lanjinger.com)