Hong Kong-listed insurance stocks experienced a notable uptick during the afternoon trading session on Friday.

SUNSHINE INS (HKG: 06963) saw its share price rise by over 5%, leading the sector's gains.

Other major insurers also posted significant increases, with China Life Insurance Co Ltd, China Taiping Insurance Holdings Ltd, and China Property & Casualty Insurance Ltd all advancing more than 3%.

Shares of New China Life Insurance Co Ltd and China Pacific Insurance (Group) Co Ltd climbed over 2%.

Analysts Remain Bullish on Sector Outlook

Analysts have expressed continued optimism regarding the insurance sector's potential for valuation recovery, citing resilient fundamentals.

Firstly, they point to sustained strong market demand.

The transition towards participating insurance products, coupled with a reduction in the guaranteed interest rate, is expected to further optimize liability costs and alleviate pressure from interest spread losses.

Secondly, the recent rebound in the 10-year Chinese government bond yield to around 1.73% is a positive signal.

Analysts anticipate that a continued recovery and upward movement in long-term interest rates, alongside China's economic recovery, would ease the pressure on insurers' returns from new fixed-income investments.

Thirdly, data shows mutual funds' holdings of insurance stocks were at 1.05% at the end of the first quarter of 2026, indicating the sector remains under-owned by institutional investors.

As of June 26, 2026, the sector's valuation stood at a 2026 estimated price-to-embedded-value (PEV) ratio of 0.41-0.71x and a price-to-book (PB) ratio of 0.78-1.50x, which are considered historically low levels, supporting an "overweight" rating for the industry.