[Insurance Company Annual Report Observation] Health insurance is being "marginalized"

The total premium scale of personal insurance (including accident-and-health coverage) reached 2.3 trillion yuan, accounting for 52.8% of the industry’s total premiums for personal insurance; the combined attributable net profit to the parent company totaled 458.66 billion yuan, up 26.6% year over year—these are the 2025 performance reports turned in by seven insurers listed on both the A-share and Hong Kong stock exchanges.

Growth in performance for listed insurers has been driven by two engines: bancassurance channel pull on the liabilities side, and a sharp surge in investment income on the investment side.

While executives of insurers talk up bancassurance channel development and the increase in the proportion of premiums from dividend-paying insurance at earnings release meetings, some “runaway” figures are being overlooked: premiums for accident-and-health insurance (the combined abbreviation for personal accident and health insurance, hereinafter referred to respectively as “accident insurance” and “health insurance”) are currently experiencing negative growth. These two lines of insurance more than anything reflect an insurer’s protection function.

A reporter’s tally found that among six listed insurers that disclose accident-and-health insurance data (China Taiping Life Insurance did not separately disclose health insurance and accident insurance data, so no comparison was made), only Ping An Life’s health insurance business and accident insurance business showed positive growth.

For China Life, while its health insurance business achieved 0.9% premium growth, its accident insurance business premiums fell 13.5% year over year; China Ping An, which also discloses its life insurance business and health insurance business together, shows the same pattern—its long-term health insurance business and short-term health accident insurance business premiums fell 1.7% and 11.3% year over year, respectively; for Taiping Life, its long-term health insurance business and short-term health accident insurance business premiums fell 3% and 4.5%, respectively; Sun Life’s health insurance and accident insurance premiums fell 2.3% and 9.9%, respectively, while its bancassurance channel’s new business for wealth-management-type products grew by 70% in 2025; for New China Life, its health insurance and accident insurance premiums fell 3.4% and 2% in 2025, respectively, but the company’s new business of wealth-management-type products sold through the bancassurance channel achieved growth of more than 50%.

With weak growth momentum in protection-oriented businesses, the share of accident-and-health insurance premiums in total premiums for several major companies is also relatively low. For example, New China Life has the highest accident-and-health insurance premium share at 26.3%, while Taiping Life ranks second at 21.8%; China Ping An ranks third, with its combined accident-and-health insurance premium share at 21.2%; China Life and Taiping Life’s accident-and-health insurance premium shares are both below 20%, at 18.1% and 13.3%, respectively; and Sun Life’s accident-and-health insurance premium share is only 10.4%.

Not only is this the case for leading listed insurers; the personal insurance industry as a whole is also facing weak growth in protection-oriented businesses. Taking health insurance, which is larger in scale, as an example: in 2025, the insurance industry achieved health insurance premiums of 997.3 billion yuan, increasing by nearly 20 billion yuan compared with 2024, and much of the growth was contributed by property insurers. The data show that in 2025, the growth rates of health insurance premium income for personal insurance companies and property insurers were -0.41% and 11.31%, respectively.

As financial institutions, insurers have unique advantages in meeting customers’ wealth management and retirement-planning needs, but their essence is risk management. Their core function is to use the law of large numbers and risk diversification mechanisms to spread the risks faced by individuals across the group, and when risks occur, provide economic compensation to prevent individuals or families from falling into financial difficulty due to shocks such as accidents, illness, or death.

For a long time, in the premium sources of China’s personal insurance companies, the share of investment-type products such as dividend-paying insurance and universal insurance has remained high, and among the products with the highest premium income for several major insurers, many are savings-type products such as endowment insurance, whole-life insurance, and annuity insurance. This business model that is severely dependent on the interest-rate spread is highly vulnerable to market fluctuations and interest-rate changes. Fu Fan, Chairman of China Taiping, said at an earnings release meeting that China has entered a low-interest-rate era, and the traditional profit model that relies on the interest-rate spread urgently needs to be transformed.

In earnings reports, many insurers’ full-year attributable net profits to the parent company achieved double-digit growth. However, it is worth noting that, due to market reasons, China Life and China Reinsurance Insurance posted losses in the fourth quarter of 2025, and China Ping An and New China Life also saw declines in their attributable net profit to the parent company in a single quarter. Regarding China Life, the company said that the main reason for its loss in the fourth quarter was a structural adjustment in the capital markets, and that some of the stocks and funds it held experienced a pullback in the fourth quarter of 2025.

In the view of Tian Meipang, Vice President and Chief Actuary of China Reinsurance, and Chairman of China Reinsurance Life, when facing market volatility, whether insurers can maintain resilience mainly depends on whether they have sufficient underwriting profit. At the earnings meeting, Tian Meipang said that whether it is dividend-paying insurance or non-dividend-paying insurance, whether it is lifelong medical insurance or lifelong annuity insurance, they are all primarily savings-based—so the underwriting profit truly generated by these products is very small. Therefore, having diversified sources of profit is extremely important.

With the intensifying level of population aging, growth in residents’ demand for health protection, and increased payment pressure on the Medical Insurance Fund, the health insurance market has broad prospects. This is precisely a new growth point where insurance companies should increase their investment efforts.

Taking medical insurance as an example, data show that the median claims ratio for medical insurance is 41%, which leaves insurers with a considerable profit space. Tian Meipang believes that medical insurance will also have reasonable underwriting profit in the future. In addition, business lines such as health management and drug services will also create other sources of profit for medical insurance.