GTHT has released a research report stating it remains optimistic about the valuation recovery opportunities for low-value insurance stocks. On the liability side, the firm anticipates strong demand for residential insurance savings will drive robust growth in the early part of 2026. It expects that the reduction in guaranteed interest rates, the transition to participating insurance products, and the full implementation of integrated channel reporting will collectively push down the industry's liability costs. On the asset side, since the beginning of 2026, long-term interest rates have generally fluctuated within a range of 1.79% to 1.90%. GTHT believes that with expectations for long-term rate stability, coupled with insurance companies optimizing their asset management through balanced allocation and trading strategies, a joint improvement in profitability is forecasted. The firm maintains an "Overweight" rating on the sector. Key points from GTHT are as follows:

The insurance sector experienced an adjustment, but stabilizing interest rates are favorable for valuation recovery. From February 13 to February 27, the Shenwan Insurance Index fell from 1474.31 to 1419.21, a decline of 3.74% during the period. Over the same timeframe, the CSI 300 Index gained 1.08%, the Shanghai Composite Index rose 1.98%, and the Hang Seng Index increased 0.24%. GTHT suggests that narratives emerging after the holiday, such as "AI-driven productivity gains leading to long-term deflation," were significant catalysts for the sector's sharp decline. Against the backdrop of an overall stabilization and potential rebound in interest rates, the firm continues to favor the valuation recovery potential of undervalued insurance stocks.

In 2025, the insurance industry increased its allocation to equity assets, and overall solvency remains sufficient. 1) The insurance industry significantly increased its allocation to equities in 2025. The combined allocation to "stocks + funds" increased by approximately 1.6 trillion yuan from the start of the year, with the proportion rising by 2.6 percentage points to 15.4%. The pace of bond allocation slowed, with its share increasing by only 0.9 percentage points to 50.4%, reflecting some insurers' investment strategies focused on timing interest rate movements. 2) By the end of the fourth quarter of 2025, the average comprehensive solvency adequacy ratio for insurance companies was 181.1%, and the core solvency adequacy ratio was 130.4%, both well above the regulatory minimums of 100% and 50%, respectively. Among them, property and casualty insurers had ratios of 243.5% and 212.7%, life insurers 169.3% and 115.0%, and reinsurers 244.6% and 212.5%. Based on data from 57 life insurers and 77 P&C insurers that disclosed solvency reports, the vast majority maintain sufficient solvency and controllable risks, although five companies still failed to meet regulatory standards. 3) According to survey results from the 2026 Bank and Insurance Asset Management Industry Asset Allocation Outlook, stocks and securities investment funds are the domestic investment assets most widely favored by insurance institutions for 2026, with a majority planning slight increases to their A-share allocations.

China Life Insurance reduced its stake in Dayue City, Ping An Life Insurance underwent a chairman transition, and Sino-British Life Insurance launched a participating product with a 1.25% guaranteed rate. 1) Between August 2025 and February 2026, China Life Insurance and its asset management subsidiary collectively reduced their holding in Dayue City to 214 million shares, lowering their combined stake to 4.99%. 2) On February 14, Ping An Life Insurance announced that Chairman Yang Zheng intends to step down following the expiration of his post-retirement contract, with Vice Chairman and Deputy General Manager Cai Ting assuming his duties temporarily. 3) Sino-British Life Insurance newly launched a participating whole life insurance product, Fulmanjia C, with a reduced guaranteed interest rate of 1.25%.

Risk warnings include a decline in long-term interest rates, volatility in the equity market, and liability cost improvements falling short of expectations.