Financial Associated Press, June 28 (Reporter Wang Hong) Standing at the juncture of the second half of the year, what development opportunities can the life insurance industry and property insurance industry seize?How should you view the trend of insurance stocks in the second half of the year?
Industry experts said that for the life insurance industry, we should seize the needs of market segments, develop targeted health insurance products, and seize the needs of residents' pensions.In addition, as the industry shifts to high-quality development, insurance companies should improve their core capabilities and abandon the path dependence that once developed in a crude way.
For the property insurance industry, after the comprehensive reform of auto insurance, in the face of the intensified Matthew effect in the industry, small and medium-sized insurance companies should focus on their main business and core markets, improve corporate risk management, improve operational efficiency and reduce costs; in terms of business, they should speed up non-auto insurance Business development, maintain focus, enhance our own service capabilities, and do better and deeper.
In the first half of the year, the trend of insurance stocks was differentiated. Industry analysts pointed out that in the second half of the year, in the context of market volatility and upward trend, the investment yield of insurance companies will stabilize, profits are expected to continue to improve, and the investment yield and stock price of insurance companies and insurance companies are expected to improve.
Seize market segments and pension needs, insurance companies abandon extensive development ideas
Affected by the epidemic, China's life insurance industry has been hit hard.Data shows that in 2021, the net profit of life insurance companies will be 156.6 billion yuan, a year-on-year decrease of 39%, of which 56 life insurance companies are profitable and 21 are losing money.In the first quarter of 2022, only 33 life insurance companies were profitable.In the first five months of 2022, the insurance premium income of the life insurance industry was 1,899.2 billion yuan, a year-on-year decrease of 1%.
Whether it is the year-on-year decline in net profit or premium income, industry insiders generally believe that the traditional life insurance sales model has encountered a bottleneck, making life insurance companies must seek new sales models and structures.
Standing at the juncture of the second half of the year, what opportunities should the life insurance industry seize?Transformation in what direction?
Yang Zeyun, a teacher at Beijing Union University, said that life insurance companies can seize market segments and develop targeted health insurance products to meet the healthcare needs of residents with different health conditions and income levels."Commercial health insurance payment accounts for a relatively low proportion of direct medical expenditures such as drugs, medical products and services, and the function of commercial health insurance has not been effectively exerted. In addition, my country's mainstream health insurance products are lack of non-standard, non-medical insurance and long-term health insurance products. health insurance products, and these are the needs of customers who need insurance protection the most.”
Yang Zeyun also suggested that life insurance companies should cooperate with the top-level design of the state to develop individual endowment insurance products that can truly meet the needs of residents' endowment."In April of this year, the "Opinions on Promoting the Development of Personal Pensions" was released, which clarified the top-level design of the personal pension business. As the most veritable personal pension product, commercial pension insurance has developed relatively slowly. Incentives from preferential tax policies to vigorously develop insurance products that can indeed meet the needs of residents for the elderly should be the development direction of life insurance companies for a long time in the future.”
Although faced with problems such as insufficient grasp of customer needs, insufficient integration of medical and elderly care services, and major changes in the macro economy, in Yang Zeyun's view, as long as insurance companies deepen cooperation with pension, medical and other institutions on the one hand, insurance services can be improved. value and reduce service costs; on the other hand, technology empowerment improves operational efficiency, which not only optimizes customer experience, but also improves operational efficiency. It is believed that insurance companies can successfully transform.
"The epidemic has only accelerated the emergence of industry problems. In fact, the current industry transformation is not lacking in opportunities, whether it is policy dividends, or opportunities for pensions and general health, but why insurance companies fail to seize it is ultimately a question of ability." Zhou Jin, a management consulting partner at PricewaterhouseCoopers, believes that insurance companies need to improve their core capabilities instead of relying on license bonuses.The most difficult point in the transformation of the current life insurance industry is to abandon the once rough development path and abandon the idea of relying on scale to achieve results in the short term.
Zhou Jin said that the current industry is shifting from high-speed growth to high-quality development, and the evaluation criteria for so-called high-quality development are completely different from before.It is not about scale or manpower, but about customer value, customer satisfaction, shareholder returns, etc. Only by satisfying these comprehensive conditions can we take a high-quality development path, which is also the goal and direction to be achieved in the current transformation of the life insurance industry.
Small and medium-sized property insurance companies can focus on the main business and core market
According to a report by the Insurance Association of China, the property and casualty insurance industry as a whole is experiencing a decline in net profit and an increase in industry concentration.
In the first quarter of this year, the overall net profit of property and casualty insurance companies was 15.483 billion yuan, down 18.55% year-on-year.Among the 83 property insurance companies, 45 had a year-on-year decrease in net profit, accounting for 54.22%.The net profit of PICC P&C was 8.454 billion yuan, accounting for 55.89% of the total net profit of 83 property insurance companies, more than half of the industry, and property and casualty insurance companies had a high degree of net profit concentration.
Liu Haoyu, a British actuary and consulting partner of KPMG insurance industry, pointed out that small and medium-sized property and casualty insurance companies will face greater pressure to survive in the future. On the one hand, the market competition will intensify, and the cost of business acquisition will remain high; , it is difficult to have spare energy to invest in the transformation.
When industry profits are concentrated in leading insurance companies, where should small and medium-sized property insurance companies go?Where is the development direction?
"For many small and medium-sized property insurance companies, auto insurance revenue accounts for half of the country's total, so the profitability of auto insurance directly affects the company's profit. It is difficult to make a profit, so they have to switch to non-auto insurance,” said Dr. Wang Min, a senior consultant at Shanghai Jianwei Law Firm.
In the development process of non-auto insurance business, health insurance, agricultural insurance and liability insurance are all developing rapidly.However, Wang Min believes that it is challenging for health insurance to achieve profitability. Agricultural insurance is a policy insurance type, and many resources are concentrated in the hands of large companies, making it difficult for small and medium-sized companies to develop.For small and medium-sized insurance companies, liability insurance has a very large space for development.
"Small and medium-sized companies do not have to pursue large and comprehensive, but should seek the support of shareholders' resources, develop some new types of insurance and products with characteristics, move towards the client and industry, and be more sophisticated and in-depth. From the perspective of foreign insurance markets, especially the United States, There are many regional insurance companies that are doing well, the main reason is that they have clear positioning and serve specific customer groups." Wang Min said that maintaining focus, enhancing their own service capabilities, and improving overall related industry resources and third-party resources, improve Service value is the future development direction of small and medium-sized insurance companies.
For small and medium-sized insurance companies, Liu Haoyu believes that in the future, we must first focus on the main business and core market, improve corporate risk management, improve operational efficiency and reduce costs; start from business scenarios, rationally empower, promote auto insurance, health insurance, pet insurance , agricultural insurance and other fields.In addition, qualified companies can seize the recent rising green finance opportunities and conduct pilot projects in the fields of green asset allocation and climate risk-related insurance products.
The market is rising, the investment income of insurance companies has stabilized, and the valuation of the insurance sector is expected to be repaired
In the first half of the year, the trend of insurance stocks was divided.As of June 29, PICC rose 7.02% during the year, China Life Insurance rose 1.4%, China Ping An fell 4.13%, China Pacific Insurance fell 13.97%, and New China Insurance fell 18.42%.From the overall market situation of the industry, the insurance index experienced shocks at the beginning of the year, fell sharply from March to April, and bottomed out in mid-May. The insurance index has fallen by 0.29% this year.
Industry analysts expressed optimism about the insurance sector in the second half of the year.The non-bank team of China Merchants Securities pointed out that in the context of market volatility and upward trend, the investment yield of insurance companies will also stabilize, and the profit margin of insurance companies will continue to improve throughout the year. At the time, the investment yield and stock price of insurance companies are expected to improve.
The non-bank team of Industrial Securities believes that looking ahead to the market outlook, under the expectation of improvement in assets and liabilities, the valuation recovery trend of the insurance sector may be strengthened with the recovery of the economy and the improvement of the epidemic.The current valuation has bottomed out under the recovery of interest rates and premiums; it is expected that in the third quarter, as the impact of the epidemic weakens and the trend of premium recovery strengthens and the quarter-on-quarter performance of the interim report improves, the valuation will begin to recover; in the fourth quarter, various insurance companies have started a good start and sales conditions have turned warmer It is expected that the continuous verification of the superimposed three quarterly results may form a catalyst for further repair of the valuation.
