China: Premiums of universal insurance in the first five months decreases by 51 billion yuan year-on-year
Following a 19% year-on-year decline in 2020, universal insurance premiums continue to shrink this year. The latest data disclosed by China Banking and Insurance Regulatory Commission shows that in the first five months of 2021, the “new payment of policyholders’ investment funds”, which represents universal insurance premiums, reached 332.4 billion yuan, a year-on-year decrease of 51 billion yuan, and down by 13.3%. Universal insurance’s proportion in life insurance companies’ total premiums has fallen further from 18% in the last year to 15% in the first five months of this year.
Regulatory guidance and the industry’s active transformation are the main reasons for the continued decline of universal insurance. Many industry insiders said that the company has already started transformation, increased the proportion of protection insurance products such as health insurance and long-term life insurance, and reduced the premium income of universal insurance and investment-linked insurance in the short and medium term. This is not only in line with regulatory guidance and consumers’ needs, but also is conducive to the company's long-term development. Of course, if insurance companies cut universal insurance premiums, they will inevitably endure short-term liquidity pressure, decline in market share and scale, and many other pains.
Source: Securities Daily
translated by InsurView
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