A Perspective on the Annual Reports of the Big Five Insurance Companies: How to Add Value through Equity Investments

The annual reports season for A-share insurers has come to an end. We take a horizontal look at the investment performances of the five largest insurers in 2025, and in a low interest-rate environment, “seeking returns from equities” has moved from slogans and aspirations to reality. Based on the 2025 performance reports of these insurers, China Life, China Property & Casualty Insurance (China P&C), New China Insurance, China Taiping, and Ping An together achieved more than CNY 420 billion in attributable net profit, up over 20% year on year. Looking at the breakdown of profit, investment income—especially the contribution from equity investments—should not be underestimated. Meanwhile, each insurer is adding to its equity investments: on one hand, by increasing investment scale and raising the proportion (weight) in the portfolio; on the other hand, by upgrading investment strategies and moving toward more refined, granular management.

Many insurers’ management teams said they will attach great importance to the allocation value and strategic significance of equity-type assets in the overall investment portfolio, actively respond to the policy guidance for long-term funds entering the market, and increase their efforts to embrace the equity market. At the same time, considering their own asset-liability management needs and changes in the market environment, they will coordinate the allocation timing and scale for equity-type assets, and through diversified and multi-dimensional strategies, enhance the resilience of the investment portfolio and the sustainability of returns.

● By our reporter, Xue Jin

Raising equity exposure

In a low interest-rate environment, the mainstay of insurers’ funds—fixed-income assets—has returns that are difficult to cover the cost of liabilities, making increasing allocation to equity-type assets a must. One core change highlighted in the 2025 annual reports is that insurers have increased their holdings of equity-type assets. In the view of industry insiders, this is both the result of regulatory guidance and a choice that aligns with market trends.

From the data, the five largest insurers’ equity investments have not only grown in scale, but their share in the portfolios has also been rising. As of end-2025, the total invested assets of the five insurers exceed CNY 2.0 trillion, including equity investments with a scale of CNY 2.5 trillion—an increase of more than CNY 1.0 trillion from end-2024, with a growth rate as high as 75%. The proportion of equity assets in invested assets also rose from 7.8% to 12.2%, an increase of 4.4 percentage points.

If we add investments in equity funds, the trend of adding equities becomes even more pronounced. For example, China Life’s publicly traded market equity investment scale exceeded CNY 1.2 trillion, with the allocation ratio rising by nearly 5 percentage points. Ping An’s balance of stock and equity-fund investments totaled CNY 1.24 trillion, with the allocation ratio up by 9.3 percentage points to 19.2%.

As the 2025 capital market rebounded, it delivered relatively substantial returns to insurers’ increased equity holdings, opening a favorable profit window and also providing upside flexibility to performance. Several insurers’ total investment yield reached new highs in recent years. Among them, New China Insurance was 6.6% and China Life about 6.1%.

Zhao Peng, president of China P&C, said that in 2025 China P&C’s net addition to A-shares exceeded CNY 40 billion. The proportion of equity in the secondary market increased by 4.3 percentage points to 13.3%, and the amount invested in stocks and funds rose to more than CNY 250 billion. The combined comprehensive return rate of China P&C’s TPL (fair value changes recognized in profit or loss for the period) stocks and stock/fund (股基) was 30.4%, while the OCI (fair value changes recognized in other comprehensive income) stock comprehensive return rate was 19.2%.

“We positioned ourselves against the trend when the market was sluggish. In 2025, we strategically increased the equity proportion by nearly 5 percentage points, and in particular we focused on technology-related stocks that represent China’s direction toward new quality productive forces. Investing in line with historical trends and keeping pace with the tide of the times is the primary reason for the improvement in performance.” Liu Hui, vice president of China Life, said frankly, “For our equity investments in 2025, we captured structural opportunities in the market and seized the main uptrend of the growth style. Our TPL equity composite investment yield was close to 30%.”

More refined management of equity investments

Given increasingly complex market conditions, many insurers’ management teams believe that in the future, equity investment will still require adapting to circumstances and implementing even more refined management.

“Equity investment is the decisive lever for stabilizing and improving investment performance. We will adhere to a steady approach while making progress, continue to focus on the configuration value of high-dividend equity stocks under OCI, and at the same time concentrate on the growth opportunities embedded in the ‘15th Five-Year Plan and the 15-year long-term goals (十五五)’ outline, strengthen research on key industries and key areas of the industrial domain, reasonably plan our TPL stock allocation, and build a long-term equity investment portfolio that is steady in performance, competitive in the market, and more balanced.” On the direction of upcoming equity investments, Cai Zhiyi, vice president of China P&C, said.

“We will effectively increase the proportion of publicly traded market equity investments.” Su Gang, vice president of China Taiping, said China Taiping will maintain the long-term core strategy of dividend value. It will focus on listed companies that simultaneously have relatively high capabilities for dividend distribution and stable growth prospects, and use such high-quality assets as the core base holding. Meanwhile, it will strengthen the overall drawdown-resistance level of the equity investment portfolio, and construct a more comprehensive satellite strategy system covering multiple key areas such as technological innovation, healthy aging/large health, and big consumption.

Guo Xiaotao, co-CEO of Ping An, said Ping An’s core investment logic for this year is “finding certainty amid uncertainty.” “For long-cycle patient capital, the most important thing in investing is to align with the direction of national economic development,” he said. He added that factors such as new quality productive forces, infrastructure, medical and healthcare/healthcare and aging, a strong financial country, and Healthy China are all sources of certainty—these are important directions for Ping An’s long-term allocation.

“We reduce the portfolio’s overall sensitivity to volatility in any single market through scientific large-class asset allocation and diversified investment. We also make appropriate use of the asset classification mechanism under the new financial instrument accounting standards, and properly manage the impact of fair value fluctuations of equity-type assets on the income statement.” Chen Yijiang, president of New China Asset Management, said that the company will actively create excess returns by selecting excellent external asset managers, fully leverage market-oriented forces to diversify risk, reduce the impact of volatility from any single strategy, and focus on enhancing multiple research and investment (投研) capabilities. Through active management, it will strive to capture excess returns amid volatility.

Move forward steadily while balancing

Insurers’ funds are stepping up efforts to embrace the equity market. At the same time, against the backdrop of new accounting standards amplifying the effect of profit volatility, they are striving to mitigate the impact of capital market volatility on the income statement by using diversified tools and diversified allocations. Many insurers’ management teams said that, through expanding asset types and enriching investment strategies, they need to enhance the portfolio’s overall return capability and resilience.

Liu Hui said that the company has always attached great importance to alternative investments and equity investments. “Over the past two years, our alternative investments have mainly been distributed in debt-type financial products. At the same time, we also participate in equity investments and investments in private funds, as well as investments in REITs, ABS, and so on. Alternative investments are an important tool for the company to address the challenges posed by the overall low interest-rate environment. The company will continue to enhance its alternative investment capabilities so that it can play a more important role in the investment portfolio.”

“In 2026, we will continue to increase our efforts to develop and allocate innovative alternative products such as asset securitization. And we will take private equity funds—already established and planned—by the China P&C Group as our lever, focusing on areas related to national key strategies and the development of insurance business. We will proactively seize investment opportunities embedded in the construction of strategic emerging industries and modern industrial system.” Cai Zhiyi said.

Chen Yijiang said New China Insurance will continue to step up efforts to conduct diversified asset allocation. The long-term investment nature of insurance funds naturally matches asset categories such as alternative investments and equity investments. The company will actively leverage the advantage of patient capital—while serving national strategies and the development of the real economy—to share long-term investment returns brought by economic transformation and upgrading. Diversified allocation helps reduce correlations among different types of assets, improve the risk-return ratio of the portfolio, and enhance the sustainability and stability of investment performance.

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