Core Insights - The insurance industry underwent significant adjustments and proactive changes in 2025, focusing on asset-liability management and returning to its core purpose of providing protection while serving the real economy [1] Group 1: Establishment of the Dynamic Adjustment Mechanism for Predetermined Interest Rates - A notification was issued to establish a mechanism linking predetermined interest rates to market rates, guiding companies to strengthen asset-liability linkage and adopt prudent pricing [3] - The predetermined interest rates for ordinary life insurance products were adjusted throughout 2025, with values decreasing from 2.34% in January to 1.90% in October [4] - The mechanism represents a shift from passive administrative guidance to proactive market-oriented adjustments, aiming to enhance the industry's ability to navigate low-interest environments [5][6] Group 2: Continuous Improvement of Investment Policies for Insurance Funds - A series of policies were introduced to encourage long-term investments by state-owned insurance companies in A-shares and equity funds, including adjustments to regulatory ratios and performance evaluation metrics [7][8] - These measures aim to promote a virtuous cycle of capital allocation, allowing insurance funds to better support the real economy and technological innovation [9] Group 3: Breakthroughs in Catastrophe Insurance System During the 14th Five-Year Plan - The insurance industry has made significant progress in establishing a national catastrophe insurance system, with over 150 billion yuan in payouts for disasters like floods and earthquakes [10] - The introduction of catastrophe insurance models and support for insurance companies to issue catastrophe-linked securities in Hong Kong enhances risk diversification [11] Group 4: Approval of Foreign Insurance Asset Management Companies - The establishment of foreign-owned insurance asset management companies, such as AIA's, marks a milestone in China's financial openness, signaling a deeper integration of foreign institutions into the domestic market [14][16] - This development is expected to foster competition and collaboration, enhancing the overall efficiency of the insurance asset management sector [18] Group 5: Launch of the "Car Insurance Good to Insure" Platform - The platform was created to address the challenges faced by electric vehicle owners in obtaining insurance, providing a streamlined online application process [19][20] - This initiative aims to improve consumer satisfaction and enhance the industry's capacity to underwrite high-risk vehicles [21] Group 6: Pilot Program for Insurance Fund Investment in Gold - A pilot program was launched to allow insurance funds to invest in gold, aimed at optimizing asset allocation and enhancing risk management in a low-interest environment [22][24] Group 7: Reform of Personal Marketing System in Life Insurance - A notification was issued to reform the personal marketing system in the life insurance sector, focusing on enhancing the professionalism and compliance of sales personnel [25][26] Group 8: Introduction of the First Commercial Health Insurance Innovative Drug Directory - The release of the directory marks a significant step in developing a multi-tiered medical security system, allowing for the inclusion of innovative drugs not covered by basic medical insurance [27][29] Group 9: Release of the Fourth Life Table for the Life Insurance Industry - The new life table indicates a significant decrease in mortality rates and an increase in life expectancy, reflecting the aging trend in society [30][31] Group 10: Implementation of "Report and Practice Integration" in Non-Motor Insurance - A notification was issued to strengthen the regulation of non-motor insurance businesses, promoting rational competition and enhancing the quality of services [32][34]

Core Viewpoint - The implementation of the fourth life table by the National Financial Supervision Administration is expected to enhance the pricing accuracy of life insurance products, but it may increase the pricing challenges for longevity risk management in annuity insurance products [1][2][4]. Group 1: Life Table Implementation - The fourth life table, based on over 3 billion insurance policies, will be implemented starting January 1, 2024, and is expected to reflect the declining mortality rates and increasing life expectancy in China [1][4]. - The life table serves as a crucial tool for insurance companies to determine mortality rates and set product pricing accurately [3][4]. Group 2: Longevity Risk Challenges - Annuity insurance, which is primarily focused on survival benefits, may see price increases due to extended payout periods as life expectancy rises [5][6]. - The shift to the new life table may create price volatility, affecting both consumer willingness to purchase and insurance companies' premium income [5][6]. Group 3: Regulatory and Market Environment - The Chinese insurance market has a low market share for commercial annuity insurance, consistently below 6%, indicating a need for development in this area [7]. - The industry faces challenges such as low premium scale, high interest rate risk, and difficulties in managing longevity risk, necessitating the establishment of a dynamic longevity risk assessment model [7][8]. Group 4: Recommendations for Improvement - To address the challenges posed by low interest rates, insurance companies should focus on product design to lower liability costs and expand investment ranges [10]. - The development of a national longevity risk index and the encouragement of reinsurance companies to innovate in risk management are recommended to enhance the market ecosystem [8][9].

Core Viewpoint - The implementation of the new life table in China's insurance industry is expected to enhance pricing accuracy for life insurance products, but the growing longevity risk associated with annuity insurance remains a significant challenge [1][5]. Group 1: Life Table Implementation - The new life table, known as the "Fourth Life Table," will be implemented starting January 1, 2024, and is based on over 3 billion insurance policies, providing a more accurate reflection of mortality rates and life expectancy in China [1][5]. - The life table switch is anticipated to lead to different pricing effects across various insurance products, with term life and whole life insurance potentially seeing price reductions, while annuity insurance may experience price increases due to extended payout periods [5][6]. Group 2: Longevity Risk Management - Longevity risk, defined as the financial risk arising from policyholders living longer than expected, is becoming increasingly critical as China's population ages and life expectancy rises [2][4]. - The insurance industry is urged to develop a comprehensive and dynamic model for predicting and assessing longevity risk, which would enhance pricing and actuarial capabilities [7][8]. Group 3: Annuity Insurance Market - Annuity insurance currently holds a market share of less than 6% in China's life insurance sector, indicating a lag in its development compared to other insurance products [7]. - The low interest rate environment poses challenges for the sustainability of annuity products, as they are particularly sensitive to interest rate fluctuations, impacting both the payment obligations and the asset-liability matching [7][10]. Group 4: Regulatory and Market Development - There is a call for the establishment of a reinsurance market for longevity risk, which would involve collaboration between reinsurance companies and financial institutions to develop innovative risk management tools [8][9]. - Regulatory frameworks, such as the "regulatory sandbox," are suggested to facilitate the testing of new financial products and services in a controlled environment, promoting innovation in the longevity risk management space [9].

Core Insights - The release of the "China Life Insurance Industry Experience Life Table (2025)" marks a significant shift in the life insurance sector, reflecting profound changes in population structure and longevity trends, which directly impact industry development logic [1][2][3] Group 1: Life Table Updates - The new life table will be implemented starting January 1, 2026, and represents a comprehensive coverage of industry data, significantly improving data processing efficiency [1] - The introduction of artificial intelligence and machine learning technologies allows for a more scientific and precise depiction of mortality rates and life expectancy [1] - The updated life table indicates a transition to a longevity era in China, with a general decline in mortality rates and an increase in life expectancy, highlighting improvements in healthcare and living standards [1] Group 2: Industry Transformation - The update of the life table is a crucial milestone for the transformation of the life insurance industry, as it shifts focus from sales-driven competition to actuarial capabilities, risk management, and product quality [2] - The new life table will influence product pricing structures, with declining mortality rates allowing for potential price reductions in death benefit products, while increased longevity may raise costs for annuities and pension products [2] - The life table's release necessitates a rethinking of product development logic, emphasizing the growing demand for chronic disease management, rehabilitation care, and long-term care solutions [2] Group 3: Regulatory and Governance Implications - Accompanying regulatory notifications outline the requirements for using the life table in rate determination, reserve assessments, and dividend distribution, establishing a strict retrospective mechanism [3] - These institutional arrangements aim to enhance industry governance, mitigate long-term risks, and improve the sustainability of product guarantees [3] - The life table's update encourages the industry to redefine its responsibilities, focusing on comprehensive risk management throughout the life cycle and supporting national efforts to address aging populations [3]

Core Insights - The release of the "2025 Experience Life Table" marks a significant milestone for the life insurance industry in China, transitioning from price competition to a focus on data accumulation, risk identification, and actuarial capabilities [1][2][3] Industry Overview - The new life table is based on nearly a decade of comprehensive policy data, making it the largest sample size in the global insurance market, and aims to reflect the current and future survival and mortality probabilities of the insured population [2][3] - The life table indicates a continuous increase in life expectancy, with an approximate rise of 10 years compared to the first life table, and shows significant improvements in child mortality rates and reductions in mortality rates in economically underdeveloped regions [3][4] Regulatory Framework - The Financial Regulatory Bureau has issued guidelines for the application of the new life table, emphasizing the need for insurance companies to scientifically and accurately set insurance liabilities and offer diverse, high-quality insurance products [4][5] Pricing Impact - The new life table introduces a dual-track pricing model that combines industry benchmarks with company-specific experience, allowing for differentiated and scientific management of insurance products [7][8] - The expected decrease in mortality rates for term life insurance products may lead to lower premiums, while products like annuities and pensions may see an increase in rates due to longer life expectancies [7][8] Risk Management Enhancements - The introduction of a "mortality deviation assessment mechanism" requires insurance companies to evaluate the potential deviations in mortality rates and implement a retrospective mechanism to optimize actuarial models [8][9] - This dynamic risk management process will necessitate increased investment in actuarial models, data systems, and professional talent to enhance decision-making capabilities [8][9]

Core Insights - The release of the "2025 Experience Life Table" marks a significant milestone for the life insurance industry in China, transitioning from price competition to a focus on data accumulation, risk identification, and actuarial capabilities [1][3][4] Industry Developments - The new life table will be implemented starting January 1, 2026, and is expected to enhance risk management and operational stability within the industry, leading to a more mature and sustainable market ecosystem [1][3] - The fourth life table reflects changes in mortality rates and life expectancy, with a notable increase of approximately 10 years in life expectancy compared to the first life table [4][5] Data and Methodology - The fourth life table is based on nearly a decade's worth of comprehensive policy data, making it the largest sample size in the global insurance market [3] - It includes four categories of tables: pension-related, non-pension type one, non-pension type two, and a single life table, which is a first in using individual identification numbers for mortality research [7][8] Pricing and Risk Management - The introduction of the new life table is expected to lead to more precise pricing and risk management, reducing the risk of "death loss" and improving the financial foundation of insurance companies [4][9] - The notification mandates that insurance companies must consider both the new life table and their own experience data when determining product rates, leading to differentiated pricing strategies [9][11] Regulatory Framework - The notification introduces a "mortality deviation assessment mechanism," requiring companies to evaluate potential deviations in mortality rates and establish a retrievable mechanism for regular assessments [11][12] - The regulatory body emphasizes the importance of enhancing data governance and protecting consumer rights while ensuring the effective application of the new life table [12]

Core Insights - The fourth set of life tables, released by the China Actuarial Association, indicates an increase in life expectancy, a decrease in child mortality rates, and a reduction in mortality rates in underdeveloped regions, which will directly impact insurance product pricing [2][5]. Group 1: Life Table Overview - The fourth set of life tables is a significant update since the third set was published in 2016, reflecting nearly a decade of data collection from the insurance industry [2][5]. - The new life tables will be officially implemented starting January 1, 2026, and are based on comprehensive historical policy data, making them a crucial tool for pricing, reserve assessment, and risk management in the insurance sector [4][5]. Group 2: Key Characteristics of the New Life Table - The fourth life table shows three notable trends: an increase in life expectancy by approximately 10 years compared to the first life table, significant improvement in child mortality rates across all age groups, and a marked decrease in mortality rates in economically underdeveloped areas [5]. - The changes in the life table reflect the advancements in China's economic and social development, as well as improvements in healthcare [5]. Group 3: Impact on Insurance Pricing - The updated life tables will enable insurance companies to set more precise insurance product pricing and risk management strategies, thereby reducing the "death difference loss" risk and better managing longevity risk [8][10]. - Different types of insurance products will be affected variably by the new life tables; for instance, term life and whole life insurance products may see a decrease in pricing due to lower mortality rates, while annuity products may face price increases due to longer expected payout periods [10]. Group 4: Product Innovation and Market Dynamics - The release of the new life tables is expected to drive product innovation in the insurance industry, particularly in response to the aging population and the need for diverse retirement financial solutions [8][10]. - The transition period before the implementation of the new life tables may lead to a surge in sales of certain insurance products, such as whole life and annuity products, as companies adjust to the new pricing structures [10].

Core Insights - The release of the "2025 Life Table" by the China Actuarial Association marks a significant update in nearly a decade, reflecting improvements in life expectancy and mortality rates among different demographics [1][2][3] Group 1: Life Table Overview - The new life table is based on nearly ten years of comprehensive insurance policy data, making it the largest sample size in the global insurance market [2] - The fourth life table shows a notable increase in life expectancy, with an approximate rise of 10 years compared to the first life table [2][3] - Child mortality rates have significantly improved, particularly among younger age groups, and mortality rates in economically underdeveloped regions have decreased [2][3] Group 2: Impact on Insurance Pricing - The updated life table will influence insurance product pricing, allowing companies to set more accurate premiums based on refined mortality data [4][5] - Different types of insurance products will utilize specific life tables, leading to varied pricing outcomes; for instance, term life and whole life insurance may see lower costs due to decreased mortality rates, while annuity products may face price increases due to longer expected payout periods [5][6] - The life table update is expected to drive product innovation, particularly in the areas of retirement and long-term care insurance, to better meet the needs of an aging population [4][6]

Core Viewpoint - The release of the fourth mortality table for the life insurance industry in China reflects a significant update in mortality rates and life expectancy, impacting premium pricing for various insurance products [3][6][9]. Group 1: Release of the Fourth Mortality Table - The China Actuarial Society officially released the "China Life Insurance Experience Mortality Table (2025)" on October 29, marking the fourth version since the last update in 2016 [3][4]. - The new mortality table is based on nearly ten years of comprehensive policy data, making it the largest sample size in the global insurance market [5][6]. Group 2: Changes in Mortality Rates and Life Expectancy - Compared to the previous table, the fourth mortality table shows a decrease in mortality rates by approximately 20% to 30% and an increase in life expectancy by about 2 years [8][9]. - The average life expectancy in China is projected to reach 79 years by 2024, up from 76.34 years in 2015, reflecting improvements in healthcare and living standards [6]. Group 3: Impact on Insurance Premiums - The decline in mortality rates is expected to lower premiums for term life insurance products, while premiums for annuity products may rise due to increased life expectancy [9][10]. - The actual impact on premiums will vary by company, as pricing strategies will also consider market conditions, interest rates, and other factors beyond the mortality table [10]. Group 4: Regulatory Guidelines - The notification accompanying the new mortality table outlines specific requirements for its application, including the need for insurance companies to use the table in determining minimum statutory reserves for various insurance products [8][12]. - Insurance companies are required to establish a review mechanism to ensure the accuracy of their actuarial models and to report any significant deviations in mortality rates [12].

Core Viewpoint - The release of the "2025 Experience Life Table" by the China Actuarial Association marks a significant update in the life insurance industry, reflecting changes in population life expectancy and mortality rates, which will lead to profound transformations in insurance product design and pricing [1][3][5]. Group 1: Life Table Overview - The 2025 version of the life table includes various tables for pension and non-pension businesses, serving as a crucial tool for pricing, reserve assessment, and risk management in the insurance sector [3][5]. - The life table indicates a 10-year increase in average life expectancy since the first version, alongside a significant reduction in child mortality rates, showcasing improvements in healthcare and social governance [3][5][6]. Group 2: Impact on Insurance Products - The updated life table will provide essential data for designing more scientifically sound insurance products, particularly in the areas of pension and death risk coverage [6][7]. - The life table's insights will allow insurance companies to better meet the evolving needs of consumers, especially in terms of retirement and death risk products [6][7]. Group 3: Pricing Implications - The decrease in mortality rates and increase in life expectancy suggest potential reductions in premiums for life insurance products, while pension products may see price increases due to extended payout periods [7][8]. - The actual adjustments in premiums will depend on various factors, including company strategies and market conditions, leading to a structural differentiation in pricing across different insurance products [7][8]. Group 4: Regulatory Framework - The Financial Regulatory Authority has issued guidelines to ensure the proper use of the life table, aiming to protect consumer rights and promote healthy industry development [9][10]. - The guidelines will enforce standards for premium determination, reserve assessments, and dividend distributions, ensuring fairness and transparency in the insurance market [10]. Group 5: Future Outlook - The industry is looking towards the future with advancements in artificial intelligence, which may allow for real-time adjustments in insurance premiums based on individual risk profiles [11]. - This shift towards more personalized and fair pricing models reflects the ongoing evolution of the insurance landscape, driven by technological advancements and data analytics [11].