In-depth Analysis of Insurance Institutions' 2026 Equity Allocation Strategies and Market Impacts

Based on the above research data, I will compile a systematic and comprehensive analysis report for you.

The equity market has started strongly in 2026. As an important source of medium- and long-term capital in the market, insurance institutions are actively adjusting their asset allocation strategies. In a low-interest-rate environment, equity investment is becoming a crucial “spear of offense” for insurance funds to achieve asset-liability management and annual profit targets. It is expected that insurance funds will bring over

in incremental capital to the A-share market in 2026, accounting for approximately one-third of the total incremental capital inflows into the A-share market for the year. This will profoundly change the market capital structure and bring significant allocation opportunities to the “hard tech” sector[1][2][3].

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The current yield on China’s 10-year government bonds has fallen to a historic low range of

, which poses severe challenges to insurance companies’ asset-liability management. Gao Xiaoyang, Deputy General Manager of CPIC Capital, pointed out that there is still a between the duration of insurance liabilities and that of assets. This structural contradiction is driving various insurance institutions to increase their investment proportions in alternative assets and equity assets[4][5].

From international experience, the approach to solving the interest margin loss problem can be summarized as the “three-oriented” strategy:

. In recent years, domestic high-dividend stocks have continued to outperform the market; although the yield of alternative assets has fallen to a low level, market demand remains strong; internationalization involves seeking overseas high-dividend or high-coupon assets through QDII channels[6].

Since 2025, regulators have continuously introduced policies to support insurance funds’ entry into the market, removing obstacles for equity allocation:

Policy Type	Specific Measures	Impact
Long-Term Investment Pilot Program	Total of RMB 222 billion across three batches	Opened channels for long-term entry of insurance funds into the market
Risk Factor Adjustment	Reduced equity investment risk factors by 10%	Released approximately RMB 27.5 billion in minimum capital
Investment Ratio Relaxation	Raised the upper limit for equity asset investment	Expanded allocation space
Assessment Cycle Optimization	Extended the assessment cycle	Encouraged long-term value investment

Minmetals Securities analysis points out that these policies are not simple technical adjustments, but aim to activate the strategic functions of insurance funds as “patient capital” and “long-term capital”, fundamentally dispelling market expectations of constraints on insurance funds’ investment capabilities[7].

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According to calculations by CITIC Construction Investment Securities, the incremental capital from insurance funds entering the market in 2026 mainly comes from the following four channels[2]:

Assuming a 15% growth in the balance of insurance fund applications in 2026, with a 16% equity allocation ratio and a 20% Hong Kong stock allocation ratio, it is expected to bring approximately in incremental capital to the A-share market.

The total scale of the second and third batches of the insurance fund long-term investment pilot program in 2025 was approximately RMB 172 billion. Calculated at an 80% A-share allocation ratio, the corresponding incremental capital is approximately .

Based on neutral assumptions, the reduction in risk factors can release approximately RMB 27.5 billion in minimum capital requirements for insurance funds. If all of this is invested in CSI 300 targets, it can bring about in incremental capital space.

Assuming the pace of “deposit migration” in 2026 is the same as in 2025, the scale of personal insurance premiums is expected to reach approximately , with a year-on-year growth rate of approximately 10%, bringing continuous incremental capital to the equity market.

Forecasting Institution	2026 New Equity Investment	Equity Ratio	2027 Forecast
Minmetals Securities (Neutral)	RMB 1.15 trillion	23.6%	RMB 1.45 trillion
CITIC Construction Investment	RMB 840 billion	16%	-
Founder Securities	RMB 300-770 billion	-	-

Minmetals Securities predicts that, under neutral scenario assumptions, insurance funds will add

and in equity investments in 2026 and 2027 respectively, and the proportion of equity assets will increase to and respectively[4][5].

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In 2026, the sources of incremental capital in the A-share market are characterized by

. According to calculations, insurance funds and wealth management products are expected to bring approximately in medium- and long-term incremental capital to the A-share market[2]. This scale accounts for approximately one-third of the total incremental capital inflows into the A-share market, becoming a key safety cushion for market micro-liquidity.

Since 2022, the resident sector has accumulated a considerable scale of medium- and long-term time deposits. A portion of this capital has matured successively since the fourth quarter of 2025, and is expected to flow into the stock market indirectly through “fixed income +” channels such as insurance and wealth management products. Approximately in time deposits will mature in 2026, far exceeding the new scale of insurance funds and wealth management products, so the actual capital inflow into the A-share market may exceed the forecast[8].

The figure above shows the historical trend of the maturity scale of bank time deposits and capital transfer in the capital market, revealing the long-term logic of residents’ asset reallocation[9].

In 2025, the scale of equity assets held by the “National Team” (including stocks and ETFs) reached

, an increase of compared to the end of 2022[2]. Under the combined effect of the “National Team” and medium- and long-term capital such as insurance funds, the A-share market is forming a new pattern of “value investment and long-term holding”.

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For insurance institutions targeting absolute returns, the “barbell” equity asset allocation strategy remains mainstream: one end uses

as the foundation of returns and defense, while the other end allocates to obtain alpha returns. As structural opportunities emerge in the equity market, insurance funds are prudently and flexibly adjusting allocation weights, actively seizing investment opportunities in growth sectors such as “hard tech”[1][3].

According to the investment outlooks of multiple insurance institutions, the key “hard tech” directions focused on in 2026 include[1][3][10][11]:

Sub-sector	Investment Logic	Key Target Types
AI Computing Power Infrastructure	Accelerated domestic substitution	Chips, optical modules, PCB
Semiconductor Equipment	Demand for independent controllability	Etchers, thin-film deposition equipment
Advanced Packaging	Driven by AI demand	2.5D/3D packaging enterprises
Memory Chips	Expanding supply-demand gap	DRAM, NAND manufacturers

• Industrial Machine Tools
  : Supported by national advanced manufacturing clusters, accelerated domestic substitution of core components
• Robots
  : Accelerated mass production of humanoid robots, strong demand for core components such as sensors and encoders
• Commercial Aerospace
  : Accelerated networking of low-orbit satellites such as the “Qianfan Constellation”, and the satellite internet industry chain ushered in a performance release period

• Solid-State Batteries
  : Accelerated industrialization of links such as equipment and electrolytes
• Nuclear Power
  : Key components of nuclear islands and thorium-based molten salt reactor technologies are supported by policies
• Hydrogen Energy
  : Reduction in industrial chain costs and expansion of application scenarios

According to research data, the weight distribution of insurance funds’ “hard tech” investment directions is as follows:

Investment Direction	Allocation Weight	Allocation Logic
AI/Semiconductors	25%	Clear industry trends, high certainty of performance realization
Industrial Machine Tools	18%	Policy support + domestic substitution demand
New Energy	15%	Industry cycle bottoming out and recovering
Robots	15%	Important carrier for AI application implementation
Commercial Aerospace	12%	Emerging track with strong explosive potential
High-End Materials	15%	Supports development in various fields

The 15th Five-Year Plan has elevated scientific and technological innovation to an unprecedented strategic height. The plan blueprint is built around three main lines[10][11]:

1. Scientific and Technological Innovation Leading Industrial Upgrading
   : Emphasizes “accelerating high-level scientific and technological self-reliance and self-improvement”, and tackles key areas such as integrated circuits and industrial machine tools through a new nationwide system
2. Expanding Domestic Demand and Unblocking Circulation
   : Relying on “building a strong domestic market”, promoting positive interaction between supply and demand by boosting consumption and expanding effective investment
3. Building a Three-Dimensional Security Barrier
   : Enhancing the resilience of industrial and supply chains, and strengthening guarantees in key areas such as food and energy

Historical data shows that the preparation period of the five-year plan is often accompanied by a major market uptrend, with the tech and advanced manufacturing sectors performing actively, which provides clear policy expectations for “hard tech” investment[10].

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The first quarter is the peak period for time deposit maturity, and capital may enter the equity market through insurance fund channels, becoming the time point with the most abundant incremental capital for the year, driving a periodic market rally[2].

Since the start of 2026, the A-share market has seen trading volumes exceed in multiple trading days, with market activity significantly improved. The Shanghai Composite Index has risen by approximately cumulatively, the Shenzhen Component Index by approximately , and the ChiNext Index by approximately [1][3].

The long-term holding preference and allocation directions of insurance funds (CSI 300, CSI Dividend Low Volatility 500, STAR Market common stocks, etc.) will, together with capital from public funds, private funds, etc., strengthen the dual-mainline market trend of “tech + resource products”[2][6].

Insurance funds are medium- and long-term capital, and their continuous entry into the market can prevent the market from experiencing valuation slashing rallies, helping the A-share market maintain a slow bull oscillating trend and alleviating market volatility. Historical data shows that since 2015, whenever the activity of insurance funds’ share pledges increases, it often corresponds to a periodic market bottom or valuation repair rally[7].

Insurance funds prefer high-quality assets with stable cash flows, which will guide the market to pay more attention to corporate fundamentals and long-term value, helping to form a more rational valuation system.

Although the increase in insurance funds’ equity allocation is positive for the market, the following risk factors still need attention:

1. Allocation Crowding Risk
   : The allocation crowding degree of the tech sector has reached a historical high, with the allocation ratio of active equity funds in the TMT sector approaching
   40%
   , and that in the electronics sector exceeding
   25%
   . Attention needs to be paid to preventing periodic pullbacks[12].

2. Performance Verification Risk
   : If the high growth of tech and emerging industries is not verified by performance, the market may face style switching or periodic adjustments.

3. Interest Rate Fluctuation Risk
   : If the Federal Reserve adjusts its policy or domestic interest rates rise beyond expectations, it may affect the pace of insurance funds’ equity allocation.

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1. Seize Allocation Windows
   : Against the backdrop of continuous entry of medium- and long-term capital such as insurance funds, bargain-hunt high-quality “hard tech” targets
2. Focus on Performance Certainty
   : Prioritize allocation to sub-sectors with high certainty of 2026 performance growth
3. Balanced Allocation
   : Maintain a moderate balance between growth tracks and dividend assets

1. Gain Exposure via ETFs
   : Participate in the “hard tech” market through index products such as STAR 50 ETF, Semiconductor ETF, and ChiNext ETF
2. Emphasize Long-Term Value
   : Follow the allocation directions of institutional capital such as insurance funds, focusing on the combination of high-dividend blue chips and tech leaders
3. Control Positions
   : Stay calm when the market is overheated, avoid chasing highs

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In 2026, insurance institutions are increasing equity allocation efforts in a low-interest-rate environment, which will have a profound impact on the market capital structure and the “hard tech” sector:

1. Optimization of Capital Structure
   : Expected to bring over
   RMB 840 billion
   in incremental capital, accounting for one-third of A-share incremental capital, strengthening the trend of institutionalization and long-termization

2. Opportunities for Hard Tech
   : “Hard tech” tracks such as AI, semiconductors, industrial machine tools, and commercial aerospace will receive key allocation from insurance funds, becoming the core of market structural opportunities

3. Market Pattern Restructuring
   : The continuous entry of medium- and long-term capital will help the A-share market maintain a slow bull pattern, increasing market stability and the proportion of value investment

4. Coexistence of Risks and Opportunities
   : Attention needs to be paid to the rising allocation crowding degree and performance verification risks, maintaining rationality while seizing opportunities

In the inaugural year of the 15th Five-Year Plan, as representatives of “patient capital”, the allocation behavior of insurance funds will profoundly affect the market trend in 2026 and even longer cycles. Investors should closely follow the allocation trends of insurance funds, seize structural opportunities, and at the same time do a good job in risk management.

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[1] Shanghai Securities News - Insurance Funds Bullish on 2026 Equity Market, Tapping Investment Opportunities in “Hard Tech” (https://www.stcn.com/article/detail/3598892.html)

[2] CITIC Construction Investment - Capital Escorting, Prosperity as the Compass | 2026 A-Share Capital Market Outlook (https://news.qq.com/rain/a/20260116A01FR500)

[3] Eastmoney - Insurance Funds Bullish on 2026 Equity Market, Tapping Investment Opportunities in “Hard Tech” (https://finance.eastmoney.com/a/202601193622726318.html)

[4] Sina Finance - Over RMB 1 Trillion in Incremental Capital Enters the Market, Insurance Funds Launch a New Model of “Long-Term Capital for Long-Term Investment” (https://finance.sina.com.cn/jjxw/2026-01-09/doc-inhftpvi5689196.shtml)

[5] CCTV.com - Over RMB 1 Trillion in Incremental Capital Enters the Market, Insurance Funds Launch a New Model of “Long-Term Capital for Long-Term Investment” (https://finance.cctv.com/2026/01/12/ARTIScSUGn3i7pAUiVmaEZoQ260112.shtml)

[6] China Fund News - Multiple Insurance Asset Management Institutions Speak Out, Analyzing New Changes in 2026 Allocation for Patient Capital (https://www.chnfund.com/article/AR61f3a6e7-c6d1-12a2-ac5d-3a1e5cccbd9b)

[7] Jiemian News - China Pacific Insurance Hits New All-Time High in Intraday Trading, Can Insurance Stocks Continue Their Uptrend in 2026? (https://www.jiemian.com/article/13843498.html)

[8] Shanghai Securities News - Four Keywords: Private Equity’s View of 2026 (https://m.1234567.com.cn/index.html?page=zxzw&code=202601063609264655)

[9] Wall Street China - From Slow Bull to Full Bull… How Will the A-Share Market Perform in 2026? Ten Brokerages’ Strategies Are Here (https://wallstreetcn.com/articles/3761418)

[10] The Paper - Brokerages’ 2026 Market Outlook: Tech Manufacturing Expected to Lead the “New Bull Market” (https://m.thepaper.cn/newsDetail_forward_32385351)

[11] CNFOOL - Brokerages’ 2026 Market Outlook: Tech Manufacturing Expected to Lead the “New Bull Market” (http://mp.cnfol.com/31817/article/1768402687-142215150.html)

[12] Public Securities News - Public Fund Research and Investment Personnel Interpret the Shanghai Composite Index Exceeding 4100 Points: Anchoring the Dual Main Line of “Hard Tech + Resources” (https://www.chnfund.com/article/AR20260110104253068)

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Report writing time: January 19, 2026

Data sources: Jinling AI Financial Database, brokerage research reports, regulatory public data