China's A-share listed insurers have turned in their half-year reports, and participating insurance products have emerged as the standout performer on the product front, with premium volumes accelerating across the board and the share of participating policies in new business climbing to as high as 90% at some companies.
Behind this surge in scale lies a deeper transformation centered on asset-liability management.
Industry data from the China Insurance Association shows that participating insurance original premium income broke through the trillion-yuan mark in the first half of 2026, reaching 1,012.6 billion yuan, a year-on-year increase of 94.4%, surpassing the full-year 2025 figure of 904.2 billion yuan. Against the backdrop of total original premium income of 2,871.6 billion yuan for life insurance companies, participating products now account for 35.3% of the mix.
In the low-interest-rate era, floating-return products such as participating insurance have become a key avenue for insurers to ease interest spread pressure, though the pace of adoption varies significantly across the industry. Compared with protection-type business, participating products carry relatively lower value and higher capital consumption, setting a threshold for insurers' capital requirements. Some small and mid-sized insurers have indicated they are strictly controlling the growth rate and business share of participating policies.
Listed insurers with stronger capital positions are better equipped to make the transition, and their share of participating products in new business rose further in the first half. According to half-year report data, participating products now account for over 90% of new business at Ping An Life Insurance, with management stating at the results briefing that "the company's liability side has fully shifted toward participating-type products."
Similarly, at New China Life Insurance, participating-type business accounted for more than 90% of new long-term policies during the period. Participating product premiums reached 48.492 billion yuan in the first half, up 165.4% year-on-year, with first-year premiums for long-term policies surging 645.7% to 34.502 billion yuan, far outpacing growth in other product lines.
CPIC Life saw participating insurance scale premiums of 65.687 billion yuan in the first half, up 76.1% year-on-year, with the share of participating products in new business rising to 55.5%. PICC Life recorded participating life insurance premiums of 24.235 billion yuan, representing 28.5% of original premiums, up 15.9 percentage points from the same period last year, with participating new policy periodic premiums of 11.775 billion yuan accounting for 67.7% of total new periodic premiums. China Life also noted in its half-year report that floating-return business achieved robust growth with a further increase in its business share.
The accelerated supply is being driven by demand. A senior executive at a listed insurer explained that participating products are currently highly attractive to customers: "They offer guaranteed returns while also allowing policyholders to share in the insurer's investment results — regulators require insurers to distribute at least 70% of distributable surplus to policyholders. This design of 'guaranteed floor with upside flexibility' is exactly what makes participating products sell so well."
However, the rapid rise in scale does not mean a single-minded bet on one strategy. Listed insurers are now forming a strategic consensus — balancing protection-type and participating-type businesses. Fu Xin, Deputy General Manager and CFO of Ping An Insurance (Group) Company of China, stated clearly in an interview that diversification and balance are crucial for Ping An, and that the product strategy should strike a balance between protection and participating products.
PICC management also proposed at its results conference that in the second half of the year, the company will coordinate the development of both traditional and participating insurance products, consolidate the transformation achievements of participating products from the first half, and cover diversified allocation scenarios for residents' idle funds — from short-term flexible placement to medium- and long-term value preservation and appreciation — to differentiate and meet customer needs.
In an environment characterized by low interest rates and high volatility, the asset-liability management capabilities of insurance institutions have become the decisive factor for sound operations. At a higher level, listed insurers view participating products as a critical piece in optimizing asset-liability management.
On one hand, the low guaranteed interest rate of participating products effectively reduces insurers' guaranteed funding costs on the liability side. This is reinforced by a series of policy measures — from multiple rounds of downward adjustments to the cap on guaranteed rates for newly filed participating products, to window guidance on settlement rates, and most recently, the reduction of the demonstration rate cap from 3.9% to 3.5% effective July. These combined measures target the compression of liability costs, helping to reduce the rigid payout pressure on insurers' new business and gradually alleviate interest spread loss risks across the industry.
On the other hand, the restructuring of product mix is driving a reconfiguration of asset allocation. With traditional protection-type products, insurers bear investment risk alone, leading to a conservative investment style prioritizing safety and liquidity. In contrast, participating products share both returns and risks between insurers and policyholders, making them a strategic direction for transformation in the low-rate environment.
Xia Miang, an analyst at Pacific Securities, notes that from duration matching to yield enhancement, participating products shift insurers' investment objectives from "covering rigid liability costs" to "improving long-term investment returns," transforming asset allocation logic from passive duration matching to active yield enhancement.
While easing the cost burden, the income-smoothing mechanism of participating products also provides a buffer for the investment side. In years when investment performance is strong, with actual dividend levels constrained by regulation, some investment returns are accumulated as special reserves and distributable surplus within participating accounts, used to stabilize dividend payouts during market volatility. This provides insurers with the confidence to allocate more equity assets.
Market perspectives on the ground are validating this shift. An executive at a leading insurer analyzed: "In the low-rate era, a lower guaranteed yield combined with the profit-sharing mechanism of rate-linked participating products — where returns and risks are shared — makes the company's asset-liability management more stable and opens up room for allocating more equity assets."
Looking at specific strategies from listed insurers, Xiao Jianyou, Vice President of PICC Group and President of PICC Life, stated at the results conference that the company will formulate differentiated sub-account asset allocation strategies on the investment side in the second half. "Traditional accounts face rigid liability costs and higher costs on existing products, so we need to secure stable returns while appropriately allocating more conservative equity assets to cover costs. For participating accounts, given the product characteristics of guaranteed-plus-floating returns, we need to maintain competitive return levels, so on the basis of ensuring bond allocations, we allocate a certain scale of high-flexibility equity assets to enhance returns."
From liability cost compression to asset allocation restructuring, participating products are propelling listed insurers' asset-liability management into a new phase. But the product mix adjustment is only the opening chapter — how the liability side is designed and how the investment side coordinates will determine whether participating products can truly establish a firm foothold.