At the recent 2026 Huibao World Insurance Conference held from July 3rd to 4th, the investment director of a major life insurer, Liu Xin, participated in a seminar focused on the high-quality development of the life insurance sector and delivered a speech.

Liu Xin noted that from the perspective of the total investment return rate of listed insurance companies, there are investment opportunities in the capital markets, with a particular window for realizing returns in 2024 and 2025. However, net investment income is primarily composed of returns such as dividends and bond interest, which are relatively less sensitive to capital market fluctuations. Therefore, it more accurately reflects the trend of a declining central rate for the risk-free interest rate. He stated that since net investment returns are tied to anchors like the risk-free rate, the downward trend in the central rate remains unchanged.

According to his calculations, to achieve the comprehensive return assumption of 4.0% outlined in embedded value reports, equity assets would need to deliver a return of 9.5% to balance overall returns, a target that is quite challenging to meet. The industry must seize investment opportunities in equity markets, with a strategic focus on high-growth technology sectors.

Liu Xin further elaborated on the core logic of asset allocation for life insurers, emphasizing that it involves pursuing a relative balance among returns, risk, and capital under multiple constraints. On one hand, active asset-liability management is crucial, with fixed-income assets making up over 70% of the portfolio serving as the foundational allocation. This matches liability durations and solidifies the base for net investment income. On top of this, there should be a moderate increase in allocations to non-standard assets, primary and secondary equity assets, and real estate investments to enhance overall investment returns.

On the other hand, guided by a "strategic core plus" allocation philosophy across various asset combinations, the aim is to build resilient portfolios. For instance, within primary and secondary equity portfolios, a balanced mix of stable-return and high-growth targets is essential. Maintaining strategic discipline during market volatility is key to achieving a relatively optimal long-term balance between return and risk.