Guotai Haitong Securities Co., Ltd. has released a research report indicating that the draft revision of the Insurance Law for public comment focuses on strengthening shareholder constraints, prudential regulation, risk resolution, and consumer protection mechanisms. The firm anticipates the market will place greater emphasis on insurers' capital strength and governance standards, which is expected to benefit stable, well-managed leading insurers. This environment is likely to accelerate industry consolidation, and the firm maintains an "Overweight" rating on the sector, citing opportunities for valuation recovery at historically low levels.
The primary viewpoints from Guotai Haitong are as follows:
Interim results from listed insurers align with expectations; insurance stocks demonstrate stability amid style rebalancing
Between August 28 and September 11, the Shenyin Wanguo Insurance Index (801194.SI) declined from 1,222.61 to 1,212.55, representing a decrease of 0.82%. During the same period, the CSI 300 fell by 2.15%, the Shanghai Composite Index dropped 1.62%, and the Hang Seng Index decreased by 3.05%. Following the conclusion of interim report disclosures, profit divergence among insurers is primarily driven by differing equity investment strategies. Interim dividend payouts have been broadly consistent, reflecting a strong commitment to shareholder returns, while core operational metrics in both property and life insurance segments are trending positively. Currently, insurance stock valuations are still more influenced by external environmental factors than by internal operational results. Against the backdrop of style rebalancing, the firm continues to favor opportunities for sector valuation recovery.
Regulatory developments include public consultation on the Insurance Law revision and capital injection for five state-owned insurers
1) Data from August 28 indicates a new round of QDII quota expansion, with insurance institutions receiving an additional $1.36 billion in investment quota. 2) Central bank data from September 3 shows steady year-on-year growth in the insurance industry's total assets and liabilities at the end of the second quarter, rising by 11.8% and 12.2%, respectively. 3) On September 4, the National Financial Regulatory Administration initiated public consultation on the draft revision of the Insurance Law, aiming to enhance industry supervision, risk resolution, and consumer protection mechanisms across multiple dimensions. 4) On the same date, a State Council Information Office press conference on the '15th Five-Year Plan' reported notable achievements in the implementation of the long-term care insurance system, which now covers over 320 million participants and benefits more than 4.6 million disabled individuals. 5) News from September 6 confirms that the Ministry of Finance plans to inject a total of 70 billion yuan into five state-owned insurance companies, bolstering the industry's capital strength and risk resilience.
PICC increases A-share equity allocation; Guo Shi approved as deputy general manager of AIA Life Insurance
1) On August 31, at its interim results conference, PICC revealed a net increase of approximately 30 billion yuan in A-share positions during the first half of the year, completing a 10 billion yuan private securities fund establishment. Its investment performance has outperformed the CSI A500 Dividend Index. 2) As of September 8, Guo Shi has been approved to serve as deputy general manager of AIA Life Insurance, with approval granted in August 2026.
Risk warnings
Potential risks include: liability cost improvements falling short of expectations; persistence of customer demand for insurance savings products not meeting projections; downward movement in long-term interest rates; and volatility in the equity market.