Core Viewpoint - China Pacific Insurance (CPIC) reported strong financial performance for the first half of 2025, with significant growth in net profit and investment assets, indicating a robust operational capacity in both property and life insurance sectors [1][2][3][4]. Group 1: Financial Performance - In the first half of 2025, CPIC achieved a net profit of 35.888 billion yuan, representing a year-on-year increase of 17.8% [1]. - The net profit attributable to shareholders was 26.530 billion yuan, up 16.9% year-on-year [1]. - Total investment income reached 41.478 billion yuan, marking a 42.7% increase compared to the previous year [4]. Group 2: Insurance Premium Growth - CPIC's insurance service revenue for the first half of 2025 was 280.25 billion yuan, reflecting a year-on-year growth of 7.1% [2]. - The original insurance premium income was 454.625 billion yuan, with a year-on-year increase of 6.4% [2]. - The property insurance segment generated original premium income of 323.282 billion yuan, a 3.6% increase year-on-year, maintaining a market share of 33.5% [2]. Group 3: Life Insurance Performance - The life insurance segment showed positive growth, with original premium income of 90.513 billion yuan, up 14.5% year-on-year [3]. - First-year premium income reached 22.682 billion yuan, increasing by 25.6% [3]. - Renewal premium income was 49.251 billion yuan, reflecting an 11.7% growth [3]. Group 4: Investment Asset Management - As of June 30, 2025, CPIC's investment asset scale exceeded 1.7 trillion yuan, growing by 7.2% since the beginning of the year [1]. - The average total investment return over the past three years was reported at 4.5% [4]. - The asset management segment under CPIC had an asset scale of 1.94 trillion yuan, with a 2.3% increase from the start of the year [4].

Core Viewpoint - The growth in premium income does not necessarily lead to an increase in insurance service income, as evidenced by the 2024 annual reports of listed insurance companies [1][2]. Group 1: Insurance Service Income Trends - In 2024, the insurance service income of listed insurance companies showed divergence, with property insurance companies experiencing growth while life insurance companies saw declines [2][4]. - Among the five major listed insurance companies, property insurance firms like China Ping An, China Life Insurance, and China Pacific Insurance reported increases in insurance service income, while life insurance companies such as China Life and New China Life experienced declines [4]. - Specifically, the insurance service income for property insurance companies grew as follows: China Re Property Insurance at 485.22 billion yuan (up 6.1%), Ping An Property Insurance at 328.15 billion yuan (up 4.7%), and China Pacific Property Insurance at 191.40 billion yuan (up 8.1%) [4]. Group 2: Impact of New Accounting Standards - The implementation of the new insurance contract standards has changed how insurance income is reported, shifting from "insurance business income" to "insurance service income" [3][5]. - The difference in accounting treatment means that premium income is recognized upon receipt, while insurance service income is recognized over the service period, leading to potential discrepancies between the two metrics [5]. - The transition to the new standards has resulted in a lack of clarity and focus on the insurance service income metric, which is more complex and involves various assumptions and calculations [6][7]. Group 3: Future Outlook - As the industry gradually shifts to the new standards, the importance of insurance service income is expected to increase, particularly for life insurance companies that are moving towards high-quality development [7]. - The overall stability in insurance service income, despite some declines, indicates that companies are still managing to maintain a level of performance [6].

Core Insights - The growth in premium income does not necessarily lead to an increase in insurance service income, as revealed in the 2024 annual reports of listed insurance companies [1][4]. Group 1: Insurance Service Income Trends - In 2024, the insurance service income showed divergence among listed insurance companies, with property insurance companies experiencing growth while life insurance companies saw declines [2][4]. - Among the three major property insurance companies, all reported increases in insurance service income: China Pacific Insurance at 191.4 billion yuan (up 8.1%), Ping An Property at 328.1 billion yuan (up 4.7%), and China Re at 485.2 billion yuan (up 6.1%) [2]. - Conversely, four out of five listed life insurance companies reported declines in insurance service income, with China Life down 2%, Ping An Life down 0.1%, China Taiping down 2.3%, and Xinhua Insurance down 0.5%. However, China Re Life reported a significant increase of 23% [2][3]. Group 2: Impact of New Accounting Standards - The implementation of the new insurance contract standards has changed how insurance income is reported, shifting from premium income to insurance service income, which is recognized based on the progress of service delivery rather than upon receipt of premiums [4][5]. - The difference in accounting treatment means that while premium income can be recognized immediately, insurance service income is recognized over the service period, leading to potential discrepancies between the two metrics [4][5]. - The insurance industry is still transitioning to the new standards, and there is a lack of understanding and focus on the insurance service income metric among industry participants [5][6]. Group 3: Future Outlook - As the industry adapts to the new standards, the importance of insurance service income is expected to increase, particularly for life insurance companies that are moving towards high-quality development and should focus on value premiums rather than just scale [6][7]. - The complexity of the insurance service income metric, which involves various assumptions and calculations, has contributed to its lower visibility compared to traditional premium income [5][6].