The 2026 interim results season for listed insurers has come to a close. Against a backdrop of rapid growth in new energy vehicle (NEV) insurance, deeper comprehensive non-auto insurance governance, and intensifying strong El Ni帽o weather patterns, the operational status of the "Big Three" listed property insurers, a barometer for the industry, warrants close examination.

Looking at segment-level developments, trends in auto and non-auto insurance among the major players, along with management's outlook for the second half, deserve detailed analysis.

Fee Control Drives Universal Combined Ratio Improvement

Judging by core interim metrics, the "Big Three" have sustained improvements in combined ratios and maintained underwriting profitability, driven by refined cost management and higher underwriting quality. Specifically, PICC Property and Casualty posted the lowest combined ratio at 94.5%, a year-on-year improvement of 0.8 percentage points. CPIC Property Insurance showed the most significant improvement, with a combined ratio of 95%, down 1.3 percentage points. Ping An Property & Casualty recorded a combined ratio of 95.1%, a 0.1 percentage point improvement.

Among second-tier listed property insurers, apart from China Taiping Insurance, whose combined ratio rose 1.3 percentage points to 98%, both Sunshine Insurance and ZhongAn Online saw improvements, with ratios of 98.7% and 95.5% respectively, each down 0.1 percentage points year-on-year. According to analysis from Dongwu Securities, the combined underwriting profit for the "Big Three" reached 27.25 billion yuan in the first half of 2026, up 17.3% year-on-year.

The ability of listed property insurers to maintain cost ratio improvements despite a high base primarily stems from effective reductions in expense ratios. Over the past two years, regulators have strongly promoted the "unified reporting and pricing" policy in auto and non-auto insurance markets, with leading insurers taking the initiative in tightening fee management. For the "Big Three," data shows that in the first half, the comprehensive expense ratios for PICC P&C, Ping An P&C, and CPIC Property were 22.1%, 24.8%, and 26.3% respectively, down 0.9, 1.2, and 0.5 percentage points year-on-year.

Beyond the top three, reducing expenses has become a market-wide consensus. In the first half of 2026, commission and fee expenses for property insurers totaled 77.92 billion yuan, a 3.63% year-on-year decline. Chen Hui, General Manager of CPIC Property Insurance, attributed the improved underwriting quality to three main factors at the results conference: a deep transformation in business philosophy and development models, which has largely cleared risk exposure and eliminated long-term loss-making or high-fee businesses; shifting risk control to pre-emptive prevention rather than post-disaster claims; and building long-term safeguard mechanisms through enhanced talent support and technological empowerment.

NEV Insurance Maintains Strong Growth, Going Global Becomes a Shared Strategy

In the auto insurance segment, with traditional market growth slowing and approaching saturation, NEV insurance has emerged as a key growth driver for property insurers, including the "Big Three." Data for the first half of 2026 shows continued robust growth in NEV insurance. PICC P&C underwrote 8.061 million NEVs, up 30.9% year-on-year. Ping An P&C reported NEV original insurance premiums of 26.415 billion yuan, up 21.5%, underwriting 6.78 million vehicles, a 27.8% increase on a comparable basis, with its market share rising to 28%. CPIC Property saw NEV premiums reach 12.812 billion yuan, up 20.9%.

According to Dongwu Securities, NEV insurance accounted for 24.3% and 23.9% of total auto premiums at Ping An P&C and CPIC Property respectively. ZhongAn Online recorded even higher NEV premium growth of 105.7%, with NEV representing 36.5% of its auto premium book.

To address the high claim frequency and loss ratios associated with NEV insurance, top insurers have ramped up cost controls. In its interim report, CPIC Property noted efforts to build systematic NEV operational capabilities, optimize cost management, and boost profitability. Zhang Daoming, Vice President of PICC Group and President of PICC P&C, explained at the results conference that both fuel and NEV insurance saw declining claim frequencies but rising average claim amounts in the first half of 2026. The drop in frequency is attributed to a higher proportion of older vehicles, which tend to have fewer claims, and advances in intelligent driving technology that reduce accident rates.

Zhang further noted that regulatory efforts to consolidate the "unified reporting and pricing" policy and strengthen three key mechanisms have created a favorable environment for auto insurance. The "Guiding Opinions on Deepening Reform and Strengthening Regulation to Promote High-Quality Development of NEV Insurance," issued by four ministries, is also being implemented gradually. "Based on comparable data, our auto insurance combined ratio outperformed the industry by a widening margin in the first half of 2026. While we initially expected the full-year ratio to be roughly flat versus 2025, we now anticipate it will be better than our earlier forecast," Zhang said. Data shows PICC P&C's auto insurance combined ratio stood at 93.5% in the first half, down 0.7 percentage points year-on-year.

Fu Xin, Vice President and CFO of Ping An Insurance, highlighted at the results meeting that NEV owners served by the company are on average 2.5 years younger than industry peers, "indicating that our differentiated products and services have attracted strong support from younger demographics."

Notably, many insurers have highlighted expanding NEV insurance overseas in their interim reports. PICC P&C mentioned advancing NEV insurance overseas projects; Ping An P&C discussed collaborating with automakers on intelligent driving safety research to support NEV expansion abroad; and CPIC Property stated its commitment to assisting NEV makers in going global by expanding overseas ecosystem partnerships. With China's NEV exports accelerating, leveraging insurance protection to support this "going global" push has become a strategic priority. Beyond auto coverage, insurers are also offering liability and engineering insurance solutions across the NEV supply chain. For instance, PICC P&C noted it is actively developing extended warranty and intelligent driving assistance insurance products to serve new productive forces.

Non-Auto Governance Strengthens, Liability and Health Insurance Face Challenges

In the non-auto segment, interim data indicates that underwriting performance for the "Big Three" improved overall, thanks to the "unified reporting and pricing" policy and enhanced fee controls. PICC P&C generated 4.093 billion yuan in underwriting profit from non-auto business, with its health and accident insurance turning profitable at 362 million yuan and liability insurance narrowing its loss from 676 million yuan to 628 million yuan year-on-year. Except for agricultural insurance, all major non-auto lines saw combined ratio improvements.

Ping An P&C reported non-auto underwriting profit of 2.539 billion yuan, with liability insurance profit surging 39.9% to 396 million yuan. CPIC Property achieved significant improvement, with its non-auto combined ratio improving 2.3 percentage points to 95.3% and underwriting profit of 1.807 billion yuan. The company stated it pursued refined governance and control of high-risk businesses while building an integrated risk reduction management system, leading to underwriting profitability across health, agricultural, liability, and corporate property insurance lines.

However, underwriting pressure persists in agricultural, liability, and health/accident insurance due to higher claims from natural disasters and accidents. For example, PICC P&C's liability insurance combined ratio improved but remained loss-making. Agricultural insurance underwriting profit fell 81.1% year-on-year, with its combined ratio rising 4.8 percentage points to 98.7%. Ping An P&C's health and accident insurance profit dropped 31%, with a 3.1 percentage point rise in combined ratio, while its agricultural insurance combined ratio edged up 0.2 percentage points to 98.2%.

The recently released "Action Plan for Comprehensive Non-Auto Insurance Governance" has attracted significant market attention, following the "unified reporting and pricing" policy and "fee-collection-before-policy-issuance" rules. Zhang Daoming described the plan as an important regulatory arrangement for the non-auto market, seen as a key document shaping its development. Since non-auto governance began in November 2025, PICC P&C has taken a leading role in standardizing market order and deepening governance efforts. He expressed confidence that as the scope of governance expands and measures take effect, comprehensive expense ratios will continue to improve.

Strong El Ni帽o Threatens Full-Year Catastrophe Losses

While property insurers have enhanced underwriting resilience through policy implementation and improved expense management, pressure on the claims side is mounting due to intensifying El Ni帽o conditions. On September 2, the China Meteorological Administration reported on El Ni帽o's current state. Gao Rong, Deputy Director of the National Climate Center, noted that due to El Ni帽o, autumn rainfall is expected to be above normal across most regions south of the Yangtze River, with significantly higher precipitation in Jiangnan and eastern southwest China, raising the probability of extreme rainfall events. Temperatures are forecast to be notably higher in eastern southwest China and southern regions, with potential heatwaves continuing into September.

The National Climate Center has also assessed that sea surface temperatures in the equatorial central-eastern Pacific continue to rise, likely peaking around November or December, forming a super El Ni帽o event that could become the strongest on record. Industry analysts point out that this summer has already displayed typical El Ni帽o development-phase characteristics, including dual rain belts in the east, widespread and intense rainstorms with overlapping and compounding impacts, and active, strong typhoons with prolonged effects.

At the results conference, Chen Hui stated bluntly that the biggest challenge for property insurers is the high frequency and uncertainty of climate impacts, with extreme weather events like heavy rain, typhoons, and mudslides posing significant challenges. Zhang Daoming noted that net catastrophe losses for the first half of 2026 decreased by approximately 600 million yuan year-on-year, impacting the loss ratio by about 0.5 percentage points. However, as of August 29, net catastrophe losses had increased by approximately 1.9 billion yuan year-on-year. Given the expectation of a strong El Ni帽o, full-year catastrophe losses are projected to exceed 2025 levels.

To address the claims pressure and underwriting challenges, Zhang Daoming said PICC P&C has made early arrangements in budget planning, underwriting policies, pricing models, risk reduction, and reinsurance, embedding catastrophe costs into pricing models and establishing a risk map for El Ni帽o cycles. "Based on current catastrophe conditions, we are confident in achieving our full-year combined ratio target," he said.

At China Re's 2026 interim results conference, Wang Zhongyao, General Manager of China Property Reinsurance Company, discussed the catastrophe impacts of El Ni帽o. He described the strong El Ni帽o event of 2026 as rare in intensity, expected to last until early 2027, fundamentally representing a redistribution of global catastrophe risks rather than a simple change in total losses. To address such impacts, Wang outlined several measures: strengthening comprehensive risk management systems, enhancing professional capabilities, adjusting business mix and pricing, dynamically updating international underwriting strategies, and reasonably utilizing retrocession arrangements.