Investment Rating - The report maintains a "Positive" investment rating for the insurance industry [12]. Core Insights - The insurance industry is expected to see a sustained improvement in interest spreads in the medium to long term, driven by recent policy, regulatory changes, and industry trends, which will enhance profitability [3][10]. - The report recommends specific stocks: New China Life Insurance, China Ping An, China Life Insurance, and China Pacific Insurance [10]. Summary by Sections Insurance Business Model: Interest Spread Analysis Framework - The current insurance profitability model aligns well with the "heavy asset interest spread business" analysis model, utilizing the classic DuPont analysis framework [6][21]. - Short-term valuation factors are primarily influenced by interest spread expectations, while long-term factors include expansion capacity and quality [6][21]. Trend 1: Improvement in Liability Costs - A dynamic adjustment mechanism and cost control measures are expected to drive improvements in liability costs, with a more flexible adjustment to preset interest rates in response to market conditions [7]. Trend 2: Equity Allocation Underway, Driving Interest Spread Improvement - The stability of equity assets is significantly increasing, supported by regulatory policies that encourage long-term investments and enhance the proportion of equity allocations [8][10]. Trend 3: Strong Demand and Improved Market Structure - The demand for savings-type insurance products is expected to remain stable, with the competitive landscape gradually optimizing, favoring leading insurance companies [9][10]. Valuation Outlook - Insurance stocks are anticipated to benefit significantly from the "slow bull market" in A-shares, with current P/EV valuations generally below 1x, indicating potential for recovery and growth [10][12]. Future Interest Spread Levels - The report suggests that future interest spread levels are likely to increase, supported by improved liability costs and enhanced investment returns from equity allocations [39][74].