As of June 2025, the insurance industry's asset utilization balance reached 36.2 trillion yuan, representing a 17% year-over-year increase. According to regulatory disclosed data, overall, insurance funds increased their allocation to stocks and bonds in the first half of 2025, while reducing investments in non-standard assets, funds, and bank deposits.

Within this massive capital pool, the five listed insurance companies' combined investment assets totaled 19.7 trillion yuan, an 18% increase from the same period last year. The total investment asset scale of the five A-share insurance companies was 19.73 trillion yuan: China Life had the highest investment asset scale at 7.13 trillion yuan, followed by Ping An Insurance, China Pacific Insurance, PICC, and New China Life Insurance Company Ltd. with 6.20 trillion yuan, 2.92 trillion yuan, 1.76 trillion yuan, and 1.71 trillion yuan respectively.

In terms of investment returns, in the first half of this year, China Life, Ping An Insurance, China Pacific Insurance, New China Life Insurance Company Ltd., and PICC achieved total investment returns of 127.506 billion yuan, 96.216 billion yuan, 56.889 billion yuan, 45.288 billion yuan, and 41.478 billion yuan respectively, with combined total investment returns of 367.377 billion yuan.

Due to significant differences in asset allocation among insurance companies, return rates also showed divergence. Data indicates that in the first half of this year, New China Life Insurance Company Ltd. and PICC both achieved total investment return rates of 5%, ranking at the forefront among the five listed insurance companies. Investment returns directly impacted each company's net profit growth, with New China Life Insurance Company Ltd. and PICC achieving profit growth rates of 33.53% and 16.94% respectively.

Specifically, Ping An Insurance, China Life, PICC, China Pacific Insurance, and New China Life Insurance Company Ltd. achieved net profits of 68.047 billion yuan, 40.931 billion yuan, 26.53 billion yuan, 27.885 billion yuan, and 14.799 billion yuan respectively, with year-over-year growth rates of -8.81%, 6.93%, 16.94%, 10.95%, and 33.53%.

It's evident that asset allocation profoundly affects insurance companies' profitability. Therefore, understanding each insurance company's asset allocation is extremely helpful for comprehending their investment style and potential profit volatility. Today, we analyze domestic listed insurance companies' investment returns and asset allocation through their interim reports.

**Equity Market Allocation "Far Ahead," NCI Achieves Outstanding Results**

New China Life Insurance Company Ltd.'s high allocation ratio in equity markets is industry-recognized. Particularly after Yang Yucheng's arrival from the securities sector, NCI's equity market allocation increased significantly. In the first half of this year, the company's equity market ratio (stocks + funds) reached 18.6%. Although this represents a slight 0.2 percentage point decrease from the end of 2024, it still "far exceeds" the other four listed insurance companies in proportion, while showing an absolute value increase of 12.312 billion yuan.

Looking back, Yang Yucheng parachuted into New China Life Insurance Company Ltd. as Party Secretary in August 2023 and became Chairman in December of the same year. 2023 was precisely NCI's most challenging year in recent times, with net profit falling to 87.12%. However, in Yang Yucheng's first full year, NCI's net profit reached 26.229 billion yuan, setting a historical record. Therefore, for NCI, Yang Yucheng can be considered the company's "firefighter."

Additionally, New China Life Insurance Company Ltd.'s trust plan investment assets decreased significantly by 56.7%. Analysis reveals that many trust plans' underlying assets were previously real estate targets. With the real estate industry's declining prospects in recent years and severe asset price contractions, NCI's substantial reduction in real estate holdings is understandable.

Since the fourth quarter of last year, New China Life Insurance Company Ltd. has been highly active in capital markets, successively becoming a major shareholder in Sinopharm Group, Shanghai Pharmaceuticals, Haitong Securities, and Bank of Hangzhou. NCI Vice President and NCI Asset Management Chairman Qin Hongbo stated that "strong investment" has become one of NCI's key reform initiatives, generating very strong momentum for the company's investment operations and adapting to current insurance fund asset-liability matching needs.

**PICC Achieves 5.1% Investment Return Rate, Fair Value Measured Equity Investment Surges 18.2%**

PICC also achieved over 5% profit growth in the first half of this year. Similarly, PICC increased its equity market investment ratio during this period. Fund assets reached 93.571 billion yuan, accounting for 5.3%, maintaining the same proportion as last year but increasing by 6.929 billion yuan in amount. Stock assets reached 94.625 billion yuan, accounting for 5.4%, rising 1.7 percentage points from last year with a substantial increase of 34.376 billion yuan. Furthermore, PICC's holdings in fair value measured equity investments surged 18.2%, indicating that PICC indeed made "significant efforts" in equity investment during the first half.

Regarding first-half investment returns, PICC President Zhao Peng stated at the earnings conference that PICC's long-term average investment return rate continues to lead the market, maintaining an annualized total investment return rate of 5.1% in the first half. The company will continue playing a stabilizing role in capital markets. As of the end of June, the group's A-share investment assets grew 26.1% from the beginning of the year, with their proportion of total investment assets increasing by 1.2 percentage points. The company also actively participates in the long-term stock investment pilot program for insurance funds, receiving approval for a pilot scale of 10 billion yuan.

**CPIC Investment Return Rate Shows Significant Decline, Bond "Heavy Allocation" at 75%!**

CPIC's investment return rate experienced some volatility. Data shows that CPIC's non-annualized comprehensive investment asset return rate was 2.4% in the first half, down 0.6 percentage points from 3% in the same period last year. The non-annualized total investment return rate was 2.3%, down 0.4 percentage points from 2.7% last year. The non-annualized net investment return rate was 1.7%, down 0.1 percentage points from 1.8% last year.

Analysis reveals that in CPIC's investment portfolio, equity assets (stocks + equity funds) accounted for 11.8%, up 0.6 percentage points from last year. CPIC's equity market asset allocation is not particularly high among peer companies, which prevented it from capturing excess returns despite strong equity market performance. Meanwhile, CPIC's high allocation to bond financial assets at 75% further reduced investment returns.

In August this year, CPIC announced passive stake-building in Dongyang Sunshine H-shares, holding a total of 6.7%. The company stated it would include this investment in equity investment management. Trustee manager CPIC Asset Management will closely monitor the enterprise's operating conditions and subsequent market reactions, not ruling out additional investments later. Overall, CPIC's capital market activity has been relatively lower than peer companies this year.

**Ping An and China Life Maintain Relative Stability, Demonstrating Large-Scale "Stability"!**

Although Ping An did not disclose total investment return rates in its 2025 interim report, it revealed that insurance fund non-annualized comprehensive investment return rate was 3.1% in the first half, up 0.3 percentage points year-over-year. Over the past decade, Ping An achieved an average net investment return rate of 5.0% and average comprehensive investment return rate of 5.1%.

Ping An has been exceptionally active in capital markets this year. Earlier this month, Ping An Asset Management announced that, entrusted by Ping An Life funds, it invested in CPIC H-shares on September 11, reaching 10% of H-share capital, triggering Hong Kong market disclosure requirements. This marks Ping An Life's second stake-building in CPIC H-shares following last month's action.

On August 15, Hong Kong Exchange disclosures showed Ping An's holdings in China Life H-shares reached 5.04%, triggering disclosure requirements. Looking further back, Ping An has already built stakes in multiple domestic leading banks including China Merchants Bank, Postal Savings Bank, and Agricultural Bank of China this year.

Additionally, China Life achieved a total investment return rate of 3.29% in the first half, maintaining steady levels. Allocation proportions for bonds, term deposits, and debt-type financial products remained basically stable, while stock and fund allocation (excluding money market funds) increased from 12.18% at the end of 2024 to 13.60%.

This year, China Life has also built stakes in listed companies such as CPI Financial and maintains high attention to capital markets, with equity market investment allocation reaching 13.62%, second only to New China Life Insurance Company Ltd.

**Conclusion**

Overall, New China Life Insurance Company Ltd. and PICC Group achieved relatively good investment return rates in the first half of this year, mainly benefiting from equity market gains. Ping An and China Life maintained relatively stable investment return rates, with these two companies having the largest investment amounts among listed insurance companies. CPIC's investment return rate showed a more noticeable decline.

Whether from regulatory trends or market development perspectives, insurance funds increasing equity market investment appears to be a foregone conclusion. From a regulatory standpoint, in April, the National Financial Regulatory Administration issued a notice on adjusting insurance fund equity asset regulatory proportions, clearly raising equity asset proportions corresponding to certain solvency adequacy ratios by 5%. In May, NFRA Director Li Yunze stated at a State Council Information Office press conference that solvency regulatory rules would be adjusted, further reducing stock investment risk factors by 10% to encourage insurance companies to increase market participation.

In July, the Ministry of Finance issued a notice on guiding insurance funds toward long-term stable investment and strengthening long-cycle assessment of state-owned commercial insurance companies, adjusting ROE assessment methods to combine current year indicators (30% weight) + 3-year cycle indicators (50% weight) + 5-year cycle indicators (20% weight), promoting improved long-cycle assessment mechanisms.

From market trends, as market interest rates continue declining, insurance companies have sold large quantities of high predetermined rate policies over the past two years. However, if insurance companies' investment portfolios concentrate on bonds, this will inevitably create an "inversion" between guaranteed rates and actual returns, generating operational pressure for insurance companies. Therefore, equity markets may be the most suitable path for insurance companies to generate "excess returns." We will continue tracking insurance companies' investment situations going forward.