Sino-Singapore Jingwei Client, July 5th (Dong Wenbo) The A-share market has ended in the first half of the year. The Shanghai Stock Exchange Index rose 3.40%, the Shenzhen Component Index rose 4.78%, and the Growth Enterprise Market Index rose 17.22%.
Compared with the overall upward trend of A-shares, the performance of the insurance sector was not satisfactory. The market value of the five listed insurance companies of China Life, China Pacific Insurance, PICC, Ping An and Xinhua Insurance continued to shrink in the first half of the year.
Insurance index fell more than 20% in the first half of the year
Wind data shows that among thematic industry indexes, the insurance index dropped by 23.75% in the first half of the year.
Source of insurance index trends in the first half of the year: Wind
As of the close on June 30, the total market value of the five largest listed insurance companies totaled 2,817.1 billion yuan, a decrease of 698.8 billion yuan from the end of 2020 (35159 billion yuan), a decrease of 19.88%.
In other words, the total market value of the five largest listed insurance companies in the first half of the year has shrunk by 20%.
In terms of individual stocks, Ping An of China experienced the largest share price decline during the same period, which fell 24.71% in the first half of the year; China Pacific Insurance and Xinhua Insurance also fell more than 20%, 21.15% and 20.80% respectively; China Life and PICC fell 11.72% and 9.74 respectively. %.
In addition to the shrinking market value, the premiums of the top five listed insurance companies are also under pressure.
According to the announcement, from January to May, China Life, China Pacific Insurance, PICC, Ping An, and Xinhua Insurance achieved original insurance premium income of 386.4 billion yuan, 188.782 billion yuan, 281.76 billion yuan, 361.082 billion yuan, and 82.672 billion yuan respectively, year-on-year The growth rates were 4.49%, 5.16%, 0.37%, -5.66%, 4.64%.
Accumulatively realized original insurance premium income of 130.696 billion yuan, a slight increase of 0.69% year-on-year.
Specifically, from January to May, the life insurance premium income of listed insurance companies was 386.4 billion yuan for China Life, 121.173 billion yuan for China Pacific Insurance (CPIC Life), 79.138 billion yuan for PICC, and 251.956 billion for Ping An (Ping An Life). Yuan, Xinhua Insurance 82.672 billion yuan.
In total, the original insurance premium income of life insurance was 921.339 billion yuan, a year-on-year increase of 1.4%.
In the same period, the original insurance premium income of listed insurers’ property and casualty insurance companies were respectively: PICC (PICC P&C) 202.622 billion yuan, China Pacific Insurance (CPIC P&C) 67.609 billion yuan, and Ping An of China (Ping An Property & Casualty Insurance) 109.126 billion yuan.
In total, the original insurance premium income of property insurance was 379.357 billion yuan, a year-on-year decrease of 1.0%.
For the May premium income data continued to be under pressure year-on-year, Gao Chao, an analyst at Kaiyuan Securities, said in a research report that it was mainly affected by the slow recovery of protection demand and the high base during the same period.
Gao Chao further stated that in the second quarter, the focus was on recruiting and raising customers. Major insurance companies raised the threshold for recruiting, focusing on the recruitment of high-quality agents, focusing on "quality" and lighter "quantity". The increase in the proportion of high-quality agents is conducive to subsequent improvement on the debt side.
It is expected that the debt side will maintain a weak recovery trend in the first half of the year, and some insurance companies may try to ease the pressure on the year-on-year basis with the help of a half-year sprint.
"Continued downward pressure is not great"
Regarding the weakening of insurance stocks, Shenwan Hongyuan’s chief market expert, Gui Haoming, told the Sino-Singapore Jingwei client that this is a relatively special phenomenon in the recent market. There are several factors.
First, due to the impact of the epidemic in the past two years, insurance companies have faced greater challenges in their business development. Therefore, the growth of premium income has slowed down significantly, and some companies have even experienced negative growth.
Secondly, the relevant parties have strengthened the supervision of insurance companies. In the past, some marginal operations have been halted. After the new regulations on asset management came out, it has also posed more challenges to the insurance industry.
"To have new development, there must be innovative results, but this requires a process, so the insurance business has entered a stage of adjustment."
Gui Haoming further stated that in the short term, insurance stocks have no obvious upward momentum. In terms of trends, the downturn may continue for some time.
Huajin Securities bluntly said that new life insurance orders are sluggish and there is still no turning point, which is the core reason for the continued pressure on the sector.
Life insurance channel reforms test determination. In the past, the abuses of extensive development have accelerated and the loss of internal and external staff has been serious. It is almost impossible to return to 2019 levels with new orders when the gap between supply and demand is becoming more and more obvious.
Chen Mengjie, chief strategy analyst at Yuekai Securities Research Institute, also believes that pressure on both ends of the supply and demand is the main reason for the recent downturn in the insurance sector. The current overall valuation of the insurance sector is low, and there is little downward pressure on it.
Looking ahead, Chen Mengjie told the Sino-Singapore Jingwei client that in the long run, with the continuous increase in policy reforms and the huge industry space brought about by the needs of health care brought by the changes in population structure, the insurance industry has both low valuations and beta attributes. , Optimistic about companies that take the lead in transformation and have outstanding comprehensive advantages.
Soochow Securities pointed out that in the long run, the reform of insurance companies will gradually bear fruit, and the strong health care demand will also support the huge space of the industry, and the industry assets and liabilities are expected to usher in a trend of improvement.
The industry valuation is at a historically low level, and the long-term allocation value is excellent.
Wanlian Securities believes that the debt side continues to recover, and health + pension is expected to become the main line of industry development.
In terms of life insurance, the agent’s hostage attitude is expected to improve, and agent retention and per capita production capacity are expected to improve, which will drive the continued recovery of premiums; policy-based medical and pension insurance will be further promoted in the second half of the year, which is expected to become a breakthrough in the new round of industry premium growth. ; Insurance companies have deployed the health care industry and actively promoted the integrated development of insurance products and health care services, which is also a major driving force for the growth of the debt side.
In terms of property and casualty insurance, under the expectation that premium growth will pick up and costs will be further tightened, the profitability of auto insurance will increase; non-automotive business risks continue to clear out, and the implementation of new short-term health insurance regulations will affect health insurance premiums in the short term Growth rate, but the impact is controllable.
(Zhongxin Jingwei APP)
(The opinions in the article are for reference only and do not constitute investment advice. Investment is risky, and you need to be cautious when entering the market.)
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