At the 2026 Huibao World Insurance Conference held in Suzhou, Yu Xiaodong, Chief Executive Officer of Taiping Reinsurance and Chairman of Taiping Reinsurance (China), delivered a keynote speech titled "Making Insurance Warmer – China Taiping's Practice in Pension Finance."

He emphasized that in the era of an aging population, life insurance companies must redefine their value proposition. The core lies in deeply integrating long-term capital management with healthcare and elderly care service ecosystems, providing customers with a one-stop, full-life-cycle solution encompassing "insurance + elderly care + medical care."

Understanding the Current Demographic Context

Yu Xiaodong began by outlining China's profound demographic shifts. With a record low number of newborns in 2025 and challenges such as "getting old before getting rich" and a declining birth rate, proactive planning is crucial. The state has elevated active response to population aging to a national strategy, establishing a three-pillar pension system and encouraging the development of the silver economy. The inclusion of pension finance in the key financial tasks signifies its entry into a new stage of high-quality development.

He argued that the value proposition of life insurers needs realignment with the needs of this new era. Their unique advantages lie in providing a safety net for longevity risk and performing cross-cycle asset allocation—functions other financial institutions find difficult to replicate. Furthermore, the industry must extend from mere "cash payments" to "service delivery," transforming from pension fund managers into collaborators and providers of elderly care services. Additionally, life insurance products facilitate wealth inheritance and asset segregation.

Transforming Products for an Aging Population

Customer demands are fundamentally changing, with a growing emphasis on capital safety and return certainty over pure yield comparisons. Yu pointed out that the industry's longstanding reliance on certain product strategies and its current asset-liability status are increasingly inadequate.

Using Taiping Life as an example, he analyzed the prevalent use of increasing whole life insurance. While popular, these products grant customers a surrender option, creating unpredictable cash flows for the insurer. This uncertainty complicates the management of key risks like interest rate spread and surrender risk, as the actual duration of liabilities can contract or expand unpredictably with interest rate cycles, leading to potential asset-liability mismatch.

Therefore, Taiping Life is actively reducing the proportion of increasing whole life products and increasing the supply of annuity insurance, in line with regulatory guidance and national strategy. The rationale is clear: with over a quarter of the population aged 60 or above, a vast retired population with accumulated wealth requires more robust planning tools than increasing whole life insurance alone can provide.

Yu referenced a Goldman Sachs report predicting a structural shift in Chinese household asset allocation, with insurance's share potentially rising from 6% to 10% of total assets over the next decade. This highlights a critical opportunity for life insurers to become key managers of the public's "retirement funds" through quality service.

The fundamental public demand is simple: secure and predictable retirement income to avoid outliving one's savings. The industry's core task, then, is to return to its roots by developing genuine annuity products, especially lifetime annuities. The transformation at Taiping Life and its peers focuses on product diversification, increasing annuity supply, and using cash flow planning as a key selling point to enhance predictability and better manage risks.

Yu shared three key insights for this product transformation: First, return to genuine consumer needs; today's buyers are more proactive. Second, understand that pension annuities are fundamentally different from increasing whole life insurance—they are systematic planning tools for retirement income, not mere savings substitutes. Third, life insurers must focus on what they do best: managing longevity risk, for which annuity insurance is the core tool.

He also highlighted the practice of Taiping Life (Hong Kong), which integrates insurance products with elderly care communities in the Greater Bay Area. A key innovation is addressing cross-border payment pain points for Hong Kong residents retiring on the mainland. This case demonstrates the importance of identifying and solving the actual problems that matter most to target customers.

Finally, he mentioned Taiping Singapore's recent launch of an indexed universal life product. This product features both a fixed-income account and an index-linked account, offering capital protection with potential upside from equity markets. This design balances safety and return potential, offering flexibility similar to universal life products. Yu suggested that for the domestic market, annuity products could form the foundational layer of a client's portfolio, supplemented by increasing whole life, other whole life, and medical insurance products to create a clear, complementary structure.

Exploring New Models for Home-Based Elderly Care

Recognizing that over 90% of seniors in China rely on home-based care, Taiping Life has launched its "Enjoyable Residence" home care service. This service addresses practical needs such as in-home companionship, accompaniment for medical visits, and safety assurance for daily living.

This exploration aligns with new trends in care services. As the aging era fully arrives, the core challenge for the insurance industry in the next five-year cycle will be driving product and service innovation and optimizing operations fundamentally from the customer's perspective.

In conclusion, Yu Xiaodong stated that as a central financial enterprise, the China Taiping Insurance Group will closely follow national directives, remain people-centered, and fully contribute its strength in serving the national aging strategy through pension finance, striving to make insurance a warmer service.