[Read Annual Report] PICC: Maintain "Leading" Advantage by 2025 and Build the Development Pattern for the Next Five Years

By | Yu Yan

Edited by | Wu Ge

Produced by | Yu Guancai Finance

The year 2025 marked the closing year of China’s 14th Five-Year Plan, and it also became the first full accounting year during which Ding Xiangqun, Party Secretary and Chairman of the China People’s Insurance (Group) Co., Ltd. (hereinafter “CPIC”, 601319.SH, 1339.HK), took charge of the company.

Under the leadership of the new helmsman, how has CPIC developed in 2025, and how effective have the six reform measures been? Line after line of numbers in the 2025 annual report provides proof.

On March 27, CPIC held a performance briefing, where Ding Xiangqun and a group of senior executives attended and explained the logic behind the 2025 performance indicators.

Despite the major changes in China’s macro and micro environment in 2025, CPIC has still maintained steady development. CPIC’s total investment return and the new business value of its life insurance both hit record highs, while the combined ratio of its property & casualty insurance reached the best level in recent years.

As of 2025, CPIC achieved insurance service revenue of RMB 570.717 billion, up 6.1%; achieved original insurance premium income of RMB 738.333 billion, up 6.5%; and achieved net profit attributable to shareholders of the parent company of RMB 46.207 billion, up 9.6%.

2026 is the opening year of the “15th Five-Year Plan,” and it is also a key period for CPIC to accelerate the construction of a world-class, highly focused breakthrough organization and to improve comprehensively.

Ding Xiangqun said that in the development blueprint for the next five years, CPIC has built a tiered development pattern with a more distinctive core business, more optimized layout, and a more balanced structure.

In general terms, CPIC will continue to strengthen the core role of its property & casualty insurance business, consolidate its market advantages, and solidify the group’s “keystone” for development; strategically drive the development of its life insurance business segment,打造 the group’s “new engine,” with life insurance and health insurance positioned as the most critical strategic growth points for the future.

“An opening determines the overall picture; how you start decides the direction ahead.” Ding Xiangqun said as much.

01

Property & Casualty Insurance: Maintain Leading Advantage

As CPIC’s most core subsidiary and a leader in the P&C insurance industry, China People’s Property Insurance Co., Ltd. (hereinafter “People’s P&C”, 2328.HK), whose business scale accounts for one-third of the P&C market, has a significant influence on its business orientation and corporate moves.

Worth mentioning is that Zhang Daoming, the new helmsman of People’s P&C, made his first appearance at the performance briefing in his new role.

Three days earlier (March 24), Zhang Daoming, Vice President of People’s P&C, was appointed a member of the Party Committee of CPIC Group. On March 27, the same day as the performance briefing, People’s P&C issued an announcement disclosing that Zhang Daoming was appointed Party Secretary of People’s P&C.

After the relevant procedures are completed, Zhang Daoming will become CPIC’s Vice President and President of People’s P&C, succeeding Yu Ze, who was removed from his post three months earlier, and taking charge of People’s P&C.

At the performance briefing, Zhang Daoming interpreted People’s P&C’s 2025 performance.

As of 2025, People’s P&C had total assets of RMB 860.498 billion, up 10.6% from the beginning of the year; net assets of RMB 288.703 billion, up 10.8% from the beginning of the year. Insurance service revenue was RMB 511.594 billion, up 5.4%; original insurance premium income was RMB 555.777 billion, up 3.3%; market share was 31.6%, down slightly by 0.2%.

In 2025, People’s P&C’s combined ratio was 97.5%, down 1.3 percentage points year-on-year, including a 4.4 percentage point decline in combined ratio for corporate business. The overall claims ratio was 73.9%, up 1.3% year-on-year; and due to strengthened expense control, the combined expense ratio was 23.6%, down 2.2% year-on-year.

Under effective control of the combined ratio, in 2025 People’s P&C achieved net profit of RMB 40.377 billion, up 25.5%. Achieved net profit attributable to the parent company of RMB 46.6 billion, up 8.8%. Underwriting profit was RMB 12.535 billion, up 119.4%.

Car insurance has long been People’s P&C’s core base business. In 2025, it maintained an upward momentum in business volume without easing, with premium income exceeding RMB 300 billion, up 2.8%. The car insurance combined ratio declined by 1.5% year-on-year, and car insurance underwriting profit surged to RMB 14.3 billion, up 53.6% year-on-year.

Zhang Daoming said that People’s P&C’s 2025 car insurance performance benefited from three measures:

First, resolutely implement “reporting and settlement matching (报行合一)” for car insurance, take the lead in standardizing market order, and continuously improve compliance and operational capability;

Second, give full play to strengths in risk identification and pricing, strengthen channel layout and the sales team build-out, and continuously improve the ability to obtain quality business;

Third, vigorously enhance service quality and efficiency, strengthen smart applications and cost control, and continuously improve claims service capability.

In its car insurance business, People’s P&C’s performance in new energy vehicle insurance in 2025 was particularly outstanding. Premium income increased by 31.9% year-on-year, accounting for 22.1% of car insurance—an increase of 4.9%. The share of home-to-car insurance premiums increased slightly by 0.4% to 74.7%.

However, Zhang Daoming also acknowledged that the new energy vehicle insurance industry currently faces three major challenges: first, the claim occurrence rate is higher than that of fuel vehicles; second, socialized repair channels are insufficient, and vehicle repair costs are relatively high; third, both the proportion of injury-liability cases and compensation standards are showing an upward trend, with average claims per case rising. “All of these put the compensation pressure for new energy vehicle insurance at a high level.”

Zhang Daoming noted that, in the new energy vehicle insurance segment, some positive factors have already emerged. For example, driven by multiple factors such as the increasing proportion of used cars, improvements in driving behavior habits, and advances in assisted-driving technology, the claim occurrence rate for new energy vehicles has already shown a downward trend.

It is understood that, according to national standards, starting July 1, 2026, new heavy-duty commercial trucks will be required to be equipped with AEB; and starting January 1, 2028, new light-duty trucks will be required to be equipped with AEB.

Zhang Daoming said this will be an important favorable factor for improving claims-related risks in new energy commercial vehicles. The claims risk for trucks equipped with an Automatic Emergency Braking system (AEB) is 7% lower than for trucks not equipped with it, and average claims per case are reduced.

In addition, the domestic new energy vehicle risk grading system that is about to be rolled out will also encourage vehicle manufacturers to pay more attention to improving vehicle safety and the economic efficiency of repairs, thereby ultimately reducing vehicle repair costs.

Zhang Daoming said that in the face of these challenges, People’s P&C has actively leveraged its advantages in data, pricing, channels, and costs, and has already built a leading advantage in the new energy vehicle insurance field.

In recent years, People’s P&C has continued to increase the proportion of non-auto insurance businesses. In 2025, non-auto insurance premiums grew 3.9% year-on-year, and the business share rose to 45%, up 0.3 percentage points year-on-year.

Among them, People’s P&C’s personal non-auto insurance business maintained relatively rapid growth; its share increased by 1% to 10%. Underwriting profit grew 11.9% year-on-year, becoming the second growth curve it is committed to building.

However, People’s P&C’s non-auto insurance business development is not balanced. Critical illness and accident and health insurance grew 6.4%, the fastest growth rate; the combined ratio declined by 0.5%, achieving underwriting profitability.

As for corporate property insurance and liability insurance, in 2025 their combined ratios declined by 12.4% and 0.7%, respectively, but they are still in underwriting loss.

Agricultural insurance’s combined ratio increased by 4.6% year-on-year, becoming the biggest drag factor on profitability in the non-auto insurance business.

To address long-standing issues in the non-auto insurance market, such as irrational competition, overly high expense levels, continuous underwriting losses, and persistently high receivable premiums, the Financial Regulatory Administration released in October 2025 the “Notice on Matters Concerning Strengthening the Regulation of Non-Auto Insurance Business,” launching a combination of measures including “reporting and settlement matching (报行合一)” and “issuing policies based on expenses (见费出单).” In January 2026, it also issued the “Notice on Issuing the ‘Questions and Answers on Non-Auto Insurance Comprehensive Governance (I)’,” further clarifying the scope and boundaries of policy interpretation and unifying industry implementation standards.

More importantly, regulators put forward the concept of “comprehensive governance for non-auto insurance.”

Zhang Daoming said that the work on comprehensive governance for non-auto insurance is still at the initial stage. Regulators, industry players, and customers are in a process of application and optimization. However, promoting high-quality development in non-auto insurance through comprehensive governance has already become a consensus in the industry. A favorable market environment and development atmosphere have already taken shape to an initial extent.

As standardized governance for all non-auto insurance lines continues to be rolled out, with all regulatory requirements being fully implemented, the industry’s overall profitability in non-auto insurance is expected to show an improving trend. Zhang Daoming predicted that in 2026, the results of comprehensive governance for non-auto insurance will first be reflected in the combined expense ratios of lines such as corporate property insurance, employer’s liability insurance, and occupational accident safety liability (安责险). The combined expense ratios for these lines are expected to decline by at least two percentage points year-on-year.

At present, China’s P&C insurance market is in a critical period of transformation of new and old growth drivers. For future development, Zhang Daoming said People’s P&C will focus on five areas:

First, seek returns from compliance—take the lead in advancing “reporting and settlement matching” for car insurance and comprehensive governance for non-auto insurance, creating a favorable environment for profitability.

Second, seek returns from growth—seize strategic opportunities, strengthen business deployment, and accelerate the development of profitable insurance lines.

Third, seek returns from management—promote the establishment of underwriting and claims rules and systems, strengthen risk selection at underwriting, deepen business-structure adjustments, and build high-quality business combinations.

Fourth, seek returns from technology—advance digital transformation in depth, optimize operating mechanisms, support cost reduction, efficiency improvement, claims reduction, and loss reduction, and continue to suppress operating costs.

Fifth, seek returns from risk control—strengthen risk mitigation services, summarize the risk control models that have already achieved results, and replicate and promote them across the entire system to see effects more quickly.

Looking ahead to 2026, Zhang Daoming said CPIC expects People’s P&C’s car insurance development to keep pace with the market, and deliver incremental high-quality growth in new energy vehicles; personal non-auto insurance will maintain premium growth rates above two digits; corporate business will match GDP growth rates; policy-based insurance (policy lines) will keep both market share and scale stable; and overall premium growth will basically move in line with GDP growth. It will focus on health insurance, family insurance, and cultural and tourism insurance to accelerate drawing the second growth curve for personal non-auto insurance.

02

Life Insurance: Transformation Pains Continue

As of 2025, CPIC Life achieved insurance service revenue of RMB 25.337 billion, up 13.2%; original insurance premium income grew 18.8% year-on-year, and single/scheduled premium income grew 21.0% year-on-year; achieved new business value of RMB 8.229 billion, up 64.5% year-on-year on a comparable basis; and achieved net profit of RMB 11.774 billion.

In terms of channel performance, CPIC Life’s personal insurance channels achieved original insurance premium income of RMB 54.004 billion, up 5.4%, accounting for 42.9%; and achieved new business value of RMB 3.508 billion, up 30.4% on a comparable basis. First-year single/scheduled premiums declined by 12% year-on-year.

The size of its sales agent force was 77,000, down 7% year-on-year. Monthly average effective manpower was 19,770, also down 9.5% year-on-year.

In bancassurance channels, original insurance premium income reached RMB 68.278 billion, up 33.5%. Its original insurance premium income has already surpassed that of the individual insurance (agent) channel, with premium income share reaching 54.2%. New business value was RMB 4.672 billion, up 102.3% year-on-year on a comparable basis; first-year single/scheduled premiums grew 66.3% year-on-year.

Judging from the performance of the individual insurance channel and the bancassurance channel respectively, the individual insurance transformation that CPIC Life has promoted in recent years has still not produced obvious results; transformation pains will therefore continue.

According to CPIC’s “15th Five-Year Plan” development plan, life insurance is regarded as one of the most critical strategic growth points for the future. During the “15th Five-Year Plan” period, its share in group premiums should gradually increase, as part of efforts to build it into a first-class life insurer with value growth, a strong and solid team, leading service, and strong asset accumulation capabilities.

From CPIC Life’s performance since 2026, there has already been an improvement trend. First-year single/scheduled premiums and premiums for ten-year terms and above have all achieved relatively rapid growth, with first-year single/scheduled premium growth ranking first among the “old seven” insurers. The sales team also achieved steady volume and improved quality. Monthly average effective manpower for the personal segment grew by more than 10% year-on-year, and monthly average diamond manpower grew by nearly 50% year-on-year.

Zhao Peng, Deputy Secretary of the CPIC Life Party Committee and President, said that in 2026, CPIC Life will, with the help of new economic growth drivers, start from both the asset and liability ends, systematically improve its ability to prevent and resolve interest margin loss risks, and further reduce interest margin loss risks.

Zhao Peng said CPIC Life will continue to optimize its business structure, drive down the cost of liabilities, and build a diversified source-of-profit system.

First, expand the scale of new business to dilute existing costs. Increase efforts to drive new business, and through accumulating low-cost new business, lower the share of existing high-cost liabilities.

Second, build a diversified source of profits to reduce reliance on interest margin. Increase the supply of products with floating returns; by leveraging mechanisms for sharing interest-rate risk and revenue sharing, reduce the rigid cost of liabilities. Strengthen the push for protection-type products, enhance claims management, and thicken the benefits from the “mortality and morbidity spread” (i.e., death/disease profit). Implement “reporting and settlement matching,” strengthen refined expense management, and improve the contribution from the expense spread.

Third, strengthen duration matching to build a defense line against interest margin losses. In light of market conditions and investment return scenarios, dynamically and prudently determine product assumed interest rates, dividend and universal account interest crediting levels. Match the duration characteristics of different accounts and strengthen management of duration mismatch gaps between assets and liabilities.

03

Health Insurance: Integrated Development of Health Protection and Health Management

In 2025, CPIC Health’s premium scale surpassed the RMB 50 billion mark, reaching RMB 56.266 billion in premium income, up 15.5%. Insurance service revenue was RMB 30.433 billion, up 11.8%. New business value was RMB 7.387 billion, up 22.5% year-on-year on a comparable basis. Embedded value increased by 27.9% year-on-year.

In 2025, CPIC Health’s business structure continued to optimize. The share of protection-type product business such as long-term medical insurance remained high; profitability levels remained relatively stable. In 2025, the share of protection-type business exceeded 78%.

In 2025, CPIC Health achieved net profit under the new accounting standards of RMB 8.182 billion, up 42.8% year-on-year. Among them, the contribution of insurance service performance to profit exceeded 80%.

CPIC Health’s profit indicators have continued to grow, also benefiting from the company’s refined operation and management. In recent years, its combined claims ratio for short-term insurance has continuously improved, cumulatively declining by 6.61 percentage points. By continuously reducing non-rigid expense spending and cutting fixed costs such as office premises, while continuing to improve the income of frontline employees, its management expense ratio and combined expense ratio both declined by 0.6 and 0.3 percentage points year-on-year in 2025.

In recent years, to better serve customers’ differentiated health protection needs, CPIC Health has proactively integrated into the reform of医保支付方式 (DIP/DRG), and has continuously deepened product innovation. First, through breakthroughs in special drug responsibility, it has addressed constraints on medication use scenarios. Currently, more than 30 million-dollar medical insurance policies and mid-to-high-end medical insurance policies have established coverage responsibilities for specified drugs. Second, it has continuously upgraded the supply of mid-to-high-end medical insurance by expanding designated hospitals and including responsibilities for externally purchased drugs and medical devices, improving customers’ ability to access quality medical resources.

According to CPIC’s “15th Five-Year Plan” development plan, health insurance is also considered one of the most critical strategic growth points. During the “15th Five-Year Plan” period, efforts should accelerate the deepening of integrated development between health insurance and health management, and speed up building a first-class health insurer in which functions are effectively leveraged, health management advantages are prominent, and both quantity and quality move into the forefront.

It is worth noting that as of the end of 2025, CPIC Health’s health management business achieved service revenue of RMB 509 million, up 17.2%. It provided health management services for more than 9.52 million customers, with total services increasing by 16.9% year-on-year. The scale and service level of its health management business continued to improve.

In August 2025, CPIC Health was approved to establish a wholly owned subsidiary, CPIC Health Management Company, becoming the first health management company approved after the establishment of the National Financial Regulatory Administration.

Shiao Liduo, Secretary of the CPIC Health Party Committee and President, said that the establishment of CPIC Health Management Company is a core link in CPIC’s building of a “big health and big elderly care” ecosystem, and it is a key measure for a professional health insurance company to realize “managed medicine.” In the future, one of the important business areas of the CPIC Health Management Company will be to focus on providing drug services, strengthen collaboration across the drug supply chain, and also help reduce customers’ financial burden for drug payments.

Shiao Liduo said that in the future CPIC Health will use the professional health management company as a lever to better play the dual functions of “health protection + health promotion,” focus on its layout across three major areas—medical care, pharmaceuticals, and rehabilitation nursing—further drive the transformation of the commercial health insurance model from the traditional expense reimbursement type to managed medicine, meet customers’ diverse health needs. By leveraging the risk-mitigation effect of health management, it will reduce claims-related cost expenditures and fulfill the group’s strategic requirement to “build a first-class health insurance company where functions are effectively leveraged, health management advantages are prominent, and both quantity and quality move into the forefront.”

04

Investment Side: Increase Allocation to Equity Investments and Promote the Transformation of Alternative Investments

In 2025, CPIC’s invested assets increased 15.8% year-on-year to RMB 1.9 trillion. It achieved total investment returns of RMB 92.987 billion, up 13.2%. Among them, People’s P&C achieved total investment returns of RMB 38.639 billion, up 12.8%. The total investment return rate was 5.6%, down 0.2 percentage points year-on-year on a re-stated basis.

Judging from CPIC’s net investment return performance, in 2025 it achieved RMB 59.411 billion, up 3.7%; net investment return rate was 3.5%, down 0.2 percentage points year-on-year on a re-stated basis.

From the performance over the past three years, the average total investment return rate was 4.9%, and the average net investment return rate was 4.0%, effectively covering the liability funds’ cost in the same period.

In terms of investment structure, CPIC’s bond allocation was 48.3%, down slightly by 0.7% year-on-year.

Cai Zhiwei, a member of CPIC’s Party Committee and Vice President, introduced that fixed-income investments are an important tool for handling asset-liability matching and preventing interest rate risk. To proactively respond to the impact of the low-interest-rate environment, CPIC in 2025 strengthened proactive management of fixed-income investments, focusing on building on strengths and getting every detail right. It further enhanced its ability to research and judge the trends of medium-to-long-term interest rates, continuously improved refined and phased trading skills, seized high points in interest rates, and increased the allocation to long-duration bonds. While narrowing the duration mismatch gap, it obtained stable coupon interest income and increased the return contribution of its fixed-income assets.

In 2025, CPIC increased its allocation to stock investments. The stock allocation ratio was 8.7%, up 5.1% year-on-year; the fund allocation ratio was 4.6%, down slightly by 0.7% year-on-year.

As of the end of 2025, the carrying amount of held stocks was RMB 166.2 billion. Among them, OCI (fair value changes included in other comprehensive income) stock investment scale was RMB 70.5 billion, up sharply by 158% from the beginning of the year. Its share within invested assets rose by 2 percentage points. The average dividend yield of held OCI stocks was 4.27%. The OCI stocks’ comprehensive return was 19.2%, outperforming the CSI 300 Dividend Return All index by 17.7%. The TPL stocks’ share-basis comprehensive return was 30.4%, outperforming the CSI 800 index by 9.5%.

Cai Zhiwei said that equity investment is the deciding factor for stabilizing and improving investment performance; CPIC in 2025 further strengthened the long-term investment orientation of equity investments. It innovatively established a strategic stock investment portfolio to seize long-term investment opportunities in quality assets aligned with national strategic directions. The strategic stock portfolio’s annual net value growth rate exceeded 40%, laying a solid foundation for achieving investment returns that can “pass through cycles” and remain stable over the long term.

In addition, CPIC also promoted the transformation of alternative investments and built a new “growth engine” for obtaining stable returns. In 2025, with asset securitization and tangible asset investments as breakthroughs, the annual issuance scale of ABS on exchanges ranked first among peer insurance asset management entities. It built a “three-in-one” business model of issuance, management, and investment, and achieved a good combination of effectively implementing the central requirement to revitalize existing stock assets and meeting capital allocation needs. Among the alternative investments新增 in 2025, the proportion of innovative projects reached 37%, and multiple market-first investment projects with industry influence have been implemented.

Cai Zhiwei said that in 2026, CPIC will, based on the different liability capital attributes of property insurance and life insurance, further improve differentiated allocation among sub-accounts and refined management. The property insurance accounts will focus on maintaining the basic stability of asset duration, while life insurance accounts will manage the duration mismatch gap between assets and liabilities of liability funds, and continue to do a good job with long-duration government bond allocations.

It is reported that over the next three years, CPIC will continue to optimize asset allocation. By making fixed-income assets investments more precise and fine-grained, it will continuously improve equity asset allocation and investment strategies, and continuously advance the development of innovative alternative businesses such as asset securitization and tangible asset investments. By taking multiple measures, it will keep net investment returns relatively stable and make an active contribution to asset-liability matching, supporting the group’s steady growth in operating performance.

Image: Network

【Settled on the platform】

A wealth of information and precise analysis—available in the Sina Finance app