Zhongtai Securities released a research report stating that the "Guidance on Promoting High-Quality Development of Health Insurance" has been issued, benefiting the long-term development of health insurance. The A-share slow bull market is expected to improve the current investment ecosystem for insurance funds under persistently low interest rates. After the implementation of new standards, the profit elasticity from rising stock holdings for insurance companies is gradually expanding. Recommended focus: New China Life Insurance (A/H) (601336.SH, 01336), China Ping An Insurance (A/H) (601318.SH, 02318), China Life Insurance (A/H), AIA Group (01299), China Pacific Insurance (A/H), and People's Insurance Company of China (A/H).

Event: The National Financial Regulatory Administration released the "Guidance on Promoting High-Quality Development of Health Insurance." The policy approach remains consistent, with high-quality health insurance development being an essential path to implementing the "New National Ten Articles." The 2024 "New National Ten Articles" clearly stated the need to enhance health insurance service guarantee levels and explore information interaction between medical security information platforms and commercial health insurance information platforms. Recently, the Shanghai office of the National Financial Regulatory Administration, together with local departments, released "Several Measures on Promoting High-Quality Development of Commercial Health Insurance to Assist Innovation in the Biomedical Industry," deepening payment mechanism innovation for innovative drugs and medical devices.

Zhongtai Securities' main viewpoints are as follows:

Highlight 1: Exploring support for dividend-type long-term health insurance development. The policy mentions "supporting insurance companies with good regulatory ratings to conduct dividend-type long-term health insurance business." In recent years, as China's personal insurance industry's critical illness experience occurrence rate tables have undergone multiple updates, dividend insurance actuarial pricing has also experienced multiple reforms with gradually unified standards. Sales management, information disclosure, and consumer rights protection systems have been continuously improved, providing a foundation for creating dividend-type critical illness products. Currently, domestic critical illness insurance is mostly whole life insurance (dividend-type) combined with additional early payment critical illness insurance. Hong Kong's dividend-type critical illness insurance has developed well in recent years, providing reference for similar business in mainland China. However, compared to the current 2.0% predetermined interest rate for traditional insurance, dividend-type critical illness insurance premiums would be higher than ordinary critical illness insurance under the 1.75% predetermined interest rate pricing for dividend insurance.

Highlight 2: "Individual account-style long-term medical insurance" opens imagination space for detailed rules. The policy mentions "supporting the development of individual account-style long-term medical insurance business to enrich service forms." In 2024, resident medical insurance fund income was 1,118.091 billion yuan, with expenditures of 1,066.149 billion yuan, facing considerable pressure from the growth rate difference between income and expenditure. It is expected that unlike the current common consumer-type long-term medical insurance in the market, the so-called "individual account-style" long-term medical insurance emphasizes the capital accumulation function of "individual accounts" to pay for out-of-pocket and self-paid portions after medical insurance reimbursement. It is expected that commercial medical insurance will be encouraged to include more new medical technologies, new drugs, and new devices in coverage scope, allowing commercial insurance to play a greater role.

Highlight 3: Developing commercial insurance payment functions to reduce medical insurance and personal payment pressure while supporting innovative drug and device development. The policy mentions "supporting the establishment of collaborative cooperation mechanisms with pharmaceutical and device companies, exploring diversified payment methods for innovative drugs and devices such as market-based autonomous negotiation and pay-for-performance." In July 2025, the National Healthcare Security Administration released "Several Measures to Support High-Quality Development of Innovative Drugs," establishing a commercial health insurance innovative drug catalog, forming a pattern where basic medical insurance "covers basics" and commercial health insurance "covers precision." This opens broader development space for commercial health insurance. The institutional positioning of the commercial insurance innovative drug catalog is very clear: focusing on varieties with high innovation levels, significant clinical value, and notable patient benefits that have not yet been included in basic medical insurance, providing standardized and institutionalized entry points for commercial health insurance participation in innovative drug protection. In 2024, commercial health insurance's total compensation for innovative drugs and devices was approximately 12.4 billion yuan, accounting for about 7.7% of the innovative drug market scale, with room for future improvement.

Highlight 4: Connecting data chains to promote multi-party collaborative cooperation. The policy mentions "regulatory departments, insurance industry organizations, and information sharing platforms promoting cross-industry and cross-departmental information connectivity and collaborative empowerment, driving breakthrough progress in commercial medical insurance quick claims and direct payment." Under the DRG/DIP payment model, commercial health insurance needs to find target population product positioning.

Highlight 5: Providing development support for professional health insurance companies. The policy mentions "supporting health insurance companies with good regulatory ratings to pilot increasing the upper limit of cost allocation proportion for health management in health insurance product net premiums, piloting combined sales of health insurance and life insurance to better meet consumers' comprehensive protection needs, with related products legally submitted for filing." Previously, the "Health Insurance Management Measures" clarified that when insurance companies conduct health management services, relevant health management service content can be listed in insurance contract terms or separate health management service contracts can be signed. Health insurance products providing health management services cannot allocate costs exceeding 20% of net insurance premiums. Health management services are expected to become unique advantages for professional health insurance companies, somewhat resolving competitive pressure with traditional property and life insurance in business areas, with health management services helping transition from "insuring healthy people" to "keeping people healthy."

Highlight 6: Long-term care insurance development will welcome new opportunities. The policy mentions "comprehensively conducting life insurance responsibility and care payment responsibility conversion business, supporting insured persons to convert life insurance benefits into care expense expenditures when disabled," while proposing "actively connecting with home care, community care, and institutional care needs, providing insurance services combining cash benefits and care services." In March 2023, regulators piloted life insurance and long-term care insurance responsibility conversion business trials with a tentative two-year pilot period. Recently, the National Healthcare Security Administration released the "National Long-Term Care Insurance Service Project Catalog (Trial)," clarifying 36 basic service projects paid by long-term care insurance funds, covering three major categories: daily care, professional nursing, and health management, including specific content such as cleaning care, dietary assistance, pressure ulcer prevention, rehabilitation training, and psychological support, with detailed regulations on service frequency and technical standards.

Risk warnings: Actual policy implementation effectiveness below expectations; customer acceptance of dividend-type critical illness insurance lower than expected due to higher rates; life insurance industry transformation continues below expectations; risk of outdated information in research reports.