Analysis of the Sustainability of CPIC Life Insurance Premium Growth and Its Impact on Valuation

Based on the obtained data and market information, I conducted a systematic analysis of the sustainability of CPIC Life Insurance’s 8.1% premium growth and its impact on valuation.

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According to the latest disclosed data, CPIC Life Insurance’s premium growth performance is

:

Time Period	CPIC Life Premium Growth Rate	Industry Average Growth Rate	Difference
First 8 months of 2025	+13.2%	7.6%	+5.6pct
First three quarters of 2025	+14.2%	9.1%	+5.1pct
New Business Value	+7.7% (comparable basis +31.2%)	-	-

CPIC Life’s three major channels show differentiated development trends [1]:

Channel	Q3 Premium Scale (CNY 100 million)	YoY Growth Rate	Characteristics
Agent Channel	1,843.74	+2.9%	Focus on high-quality team building, productivity increased by 16.6%
Bancassurance Channel	583.10	+63.3%	New regular premium growth of 43.6%, becoming the core growth driver
Group & Government Channel	162.90	+12.2%	Continuous advancement of workplace business model

Implemented in August 2023, the “Uniform Reporting and Execution” policy has effectively curbed vicious price competition. Relying on its brand advantages and channel capabilities, CPIC has gained a more favorable competitive position under the new regulation [2].

In the new regular premiums of the agent channel, the proportion of

, and the proportion of floating-income products has risen, effectively addressing the interest margin loss pressure in a low-interest-rate environment [3].

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Securities analysts predict that the scale of life insurance premiums is expected to reach approximately CNY 4.8 trillion in 2026, with a YoY growth rate of about 10%. The structural trend of household savings shifting to insurance products will continue [1].

As China’s pension asset reserve ratio gradually approaches that of mature markets such as the US, the role of insurance products in the pension financial system will become increasingly prominent, and the development space for savings-type insurance remains broad [1].

CPIC’s bancassurance channel has established differentiated advantages in bank channel cooperation and customer management, laying a foundation for the sustainability of its 63.3% high growth.

The 10-year government bond yield has remained at a low level of 2.0%-2.1%, putting insurance companies under “asset shortage” pressure, and net investment yield continues to face downward pressure [3]:

Indicator	2024	YoY Change
Net Investment Yield	3.6%	-0.3pct
Total Investment Yield	5.4%	+2.7pct

Implemented in January 2025, the mechanism linking guaranteed interest rates to market interest rates may have an impact on product pricing and the pace of premium growth.

The top five life insurance companies (China Life, Ping An, CPIC, New China Life, Taikang) reported a total profit of CNY 176.3 billion in the first half of 2025, accounting for 94.6% of the industry’s total profit, indicating continuous improvement in market concentration [2].

• Bancassurance Channel
  : Sufficient momentum for high growth
• Agent Channel
  : Productivity improvement can offset scale pressure
• Product Structure Optimization
  : Enhances business quality
• Need to pay attention to the marginal impacts of
  continuous interest rate decline
  and
  market competition

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Indicator	CPIC	Industry Average	Historical Low
P/E	8.10x	7.5-9.0x	6.0x
P/B	1.49x	1.2-1.5x	0.9x
P/EV	6.78x	0.56-0.95x	5.0x

Professor Tian Lihui from Nankai University pointed out that the insurance industry is standing at a potential starting point for the “Davis Double Play” [1]:

• Liability Side Improvement
  : The “Uniform Reporting and Execution” policy curbs price competition, and the growth path for new business value is clear
• Asset Side Flexibility
  : Risk factors for equity investment have been reduced, and the function of insurance capital as “patient capital” has been activated

Scenario	Intrinsic Value (CNY)	Comparison with Current Price
Conservative Assumption	¥35.17	-20.2%
Base Case Assumption	¥40.99	-7.0%
Optimistic Assumption	¥110.23	+150.0%
Probability-Weighted Valuation	¥62.13	+40.9%

Indicator	CPIC’s Performance	Industry Comparison
ROE	18.68%	Higher than industry average
Comprehensive Solvency Ratio	215.00%	Adequate
New Business Value Growth Rate	+31.2% (comparable basis)	Leading
Investment Yield	1.80%	Above-average

• Reduction in risk factors for insurance companies’ equity investments
• Extension of assessment cycles to activate the long-term investment function of insurance capital
• Establishment of a dynamic adjustment mechanism for guaranteed interest rates

The scale of insurance capital invested in stocks has reached CNY 3.07 trillion, accounting for 8.81%, hitting a new high in recent years [3]. 70% of insurance investment officers expect to increase the proportion of equity allocation in 2026 [4].

The insurance sector exhibits the characteristic of “both offense and defense” among financial sub-sectors, with both defensive properties and upward elasticity, and a relatively prominent risk-return ratio [1].

• Continuous Interest Rate Decline
  : May exacerbate interest margin loss pressure
• Equity Market Volatility
  : Affects the performance of total investment returns
• Policy Execution Risk
  : Inadequate implementation of the “Uniform Reporting and Execution” policy may trigger compliance risks
• Economic Recovery Falling Short of Expectations
  : Impacts household insurance consumption capacity

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CPIC Life’s 8.1% premium growth rate is sustainable supported by the high growth of the bancassurance channel, optimized product structure, and household savings shift, but impacts from the interest rate environment and policy changes need attention.

Currently, valuation is at a historical low; combined with fundamental improvements and policy catalysts, the valuation repair space is substantial.

Time Horizon	Assessment
Short-Term (1-3 months)	Volatile upward trend, accumulate positions on dips
Medium-Term (6-12 months)	Valuation repair, bullish
Long-Term	Industry leader, prominent allocation value

1. Monthly Premium Data
   : Verify the sustainability of growth momentum
2. New Business Value
   : Measure the degree of business quality improvement
3. Investment Yield
   : Pay attention to improvement signals on the asset side
4. Policy Trends
   : Track changes in regulatory policies

• Upside Potential
  : P/EV repairs to 8-10x, corresponding to a stock price of CNY 50-60
• Downside Risk
  : If interest rates continue to decline below 2%, P/E may drop to 6x
• Risk-Return Ratio
  : 2:1, with prominent allocation value on dips

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[1] Jiemian News - CPIC Hits an Intraday All-Time High, Can Insurance Stocks Continue Their Uptrend in 2026?
[2] 21st Century Business Herald - 58 Life Insurance Companies Earn CNY 176.3 Billion in H1, Led by China Life, Ping An, and CPIC
[3] Eastmoney Securities Research Report - Insurance Industry H1 2025 Review and Future Outlook
[4] Sina Finance - 90% of Investment Officers Believe Stock Market Opportunities Outweigh Risks, Over Half Tend to Increase Equity Allocation
[5] Soochow Securities - Steady Progress in Securities Industry Mergers and Acquisitions; Insurance Industry Total Assets Exceed CNY 40 Trillion
[6] CPIC 2025 Semi-Annual Report