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2026-10-28 12:21:25 China Merchants Securities International published a research report stating that the National Financial Regulatory Administration released insurance premium data for Jan-Sep. Total premiums rose 0.9% YoY to RMB5.26 trillion, while premiums in Sep alone increased 6.6% YoY to RMB442 billion, reversing the decline trend of the past four months. Life insurance premiums rose 10.5% YoY in Sep to RMB291 billion, returning to positive growth, mainly driven by life insurance premiums increasing 14.6% YoY to RMB225 billion during the month. The broker expects life insurance sales recovery to continue to be reflected in 4Q26, supported by the gradual launch of 2027 癒禮good start癒穡 sales campaigns. The broker noted that property insurance premiums were broadly flat YoY at RMB151 billion in Sep, with motor insurance and non-motor insurance premiums falling 0.2% and rising 0.1% YoY respectively, marking slower growth than in Aug. Motor insurance was dragged by weak new passenger vehicle sales, while non-motor insurance growth slowed due to decelerating health insurance premium growth, which rose 3.2% YoY in Sep versus a 28.9% increase in Aug. Direct economic losses from natural disasters fell 58% YoY, driving a 19% YoY decline in natural disaster claims in 3Q, better than market estimates. The broker maintained its view that life insurance products are transitioning toward participating/dividend and floating-yield products, and expects full-year premium growth in 2026 to slow to low- to mid-single digits. After factoring in weaker underwriting performance in 3Q, the broker expects value of new business growth for listed life insurers in 2026 to slow to single digits. For property insurance, the broker maintained its forecast of low-single-digit premium growth in 2026 and expects listed property insurers' combined ratios to improve in 3Q. The broker stated that sector valuations are not expensive. Leading peers are trading at around 0.19x-0.47x projected 2026 P/EV and around 0.48x-0.96x price-to-book ratios, close to one standard deviation below the two-year historical average, with expected dividend yields of 5%-7%. Valuations retreated notably in Oct as the market factored in a high comparison base in 3Q, intensified stock market volatility and a declining yield curve. The broker maintained a constructive view on sector re-rating supported by improved asset-liability matching, and maintained an "Outperform" rating on the sector. China Merchants Securities International's investment ratings and target prices for Chinese insurers are listed below: Stock | Investment Rating | TP (HKD) PING AN (02318.HK) | Buy | HKD81 CHINA LIFE (02628.HK) | Buy | HKD39 CPIC (02601.HK) | Buy | HKD44 CHINA TAIPING (00966.HK) | Buy | HKD15 PICC GROUP (01339.HK) | Buy | HKD7.5 PICC P&C (02328.HK) | Buy | HKD20 ZA ONLINE (06060.HK) | Buy | HKD18 ------------------------------------------------------------------------------ AIA (01299.HK) | Buy | HKD112 PRU (02378.HK) | Buy | HKD137.8 (ad/u)~ AASTOCKS Financial News Website: www.aastocks.com This article was automatically translated by AI, the Chinese version should be considered the authoritative version. AASTOCKS.com Limited does not guarantee its accuracy or completeness and accepts no liability for any damages or losses arising from the use of this translation. | |