Investment Rating - The industry rating is "Recommended" [2] Core Viewpoints - In the life insurance sector, the premium growth rate continued to expand in May 2025, with original premium income for the first five months reaching 227.97 billion yuan, a year-on-year increase of 3.3%. The life insurance segment saw a significant monthly increase of 24.1% in May [1][2] - The property insurance sector reported a steady growth in auto insurance premiums, driven by new car sales, with total original premium income for the first five months at 78.05 billion yuan, a year-on-year increase of 5.2% [2] - The total assets of the insurance industry reached 3,842.39 billion yuan by the end of May 2025, reflecting a 7.0% increase from the end of 2024, primarily due to premium income growth and investment asset appreciation [3] Summary by Sections Life Insurance - Original premium income for life insurance in May was 26.74 billion yuan, with a year-on-year increase of 24.1%. The total for the first five months was 187.35 billion yuan, up 3.9% year-on-year [1] - The new investment contributions from policyholders in the first five months were 34.06 billion yuan, a decrease of 4.3% year-on-year, with May showing a slight increase of 1.2% [1] Property Insurance - The auto insurance segment's original premium income for the first five months was 37.20 billion yuan, a year-on-year increase of 4.4%, while non-auto insurance premiums reached 40.85 billion yuan, up 6.0% [2] - In May, the total original premium income for property insurance was 13.20 billion yuan, with auto insurance contributing 7.53 billion yuan and non-auto insurance 5.66 billion yuan [2] Asset Management - By the end of May 2025, the total assets of life insurance companies were 3,366.27 billion yuan, a 6.7% increase from the end of 2024, while property insurance companies had total assets of 307.76 billion yuan, up 6.1% [3] - The net assets of the insurance industry totaled 360.23 billion yuan, reflecting an 8.3% increase from the end of 2024 [3] Investment Recommendations - Recent regulatory measures are expected to lower liability costs for life insurance companies, benefiting leading firms in the sector. The current yield on ten-year government bonds is fluctuating between 1.6% and 1.7%, with anticipated adjustments in preset rates [4]

Core Viewpoint - The regulatory body has issued guidelines to enhance the sustainable operation of participating insurance products in a low-interest-rate environment, aiming to protect consumer rights and prevent unhealthy competition among insurance companies [1][2][4]. Group 1: Regulatory Guidelines - The National Financial Regulatory Administration has emphasized the need for insurance companies to strengthen asset-liability management and ensure that dividend levels are aligned with actual investment returns [1][2]. - Companies are required to adhere to the pricing mechanism for life insurance products and balance the predetermined interest rates with floating returns [2][3]. - Specific conditions have been outlined under which companies must justify their proposed dividend levels, including scenarios where the proposed rates exceed historical averages or when reserves are negative [3][4]. Group 2: Market Trends - The participating insurance market has seen rapid growth since the second half of 2024, driven by declining interest rates and the diminishing appeal of fixed-income products [2][5]. - Several insurance companies have begun to launch new participating insurance products with reduced predetermined interest rates, signaling a shift towards a "1.5% era" in the market [5][6]. - The industry anticipates further adjustments to predetermined interest rates, with expectations that they may drop below current levels by the end of July [6]. Group 3: Industry Implications - The new guidelines are expected to standardize the floating cost levels of participating insurance, encouraging companies to prudently determine dividend levels and enhance asset-liability matching [6]. - Future trends indicate that participating insurance may evolve towards lower guaranteed returns, making dividend realization rates a key competitive factor for insurance companies [6]. - Consumers are advised to focus on the insurer's solvency, dividend realization rates, and investment capabilities rather than just projected returns when selecting products [6].

Investment Rating - The industry rating is "Recommended" [5] Core Insights - The report highlights the recent implementation of the fifth listing standard for unprofitable companies on the Sci-Tech Innovation Board, aimed at enhancing the inclusivity and adaptability of the system to support high-quality technology enterprises [3][16] - Regulatory measures have been introduced to standardize dividend insurance, which is expected to lower the liability costs for insurance companies and promote sustainable dividend levels [4][19] Summary by Sections Market and Sector Performance - During the week of June 15-21, 2025, the average daily trading volume of A-shares was 12,150 billion yuan, a decrease of 11.4% week-on-week but an increase of 60.1% year-on-year [20] - The non-bank financial index fell by 1.09%, underperforming the CSI 300 index by 0.64 percentage points, ranking 11th among all primary industries [2][13] - The securities sector declined by 1.73%, while the insurance sector saw a slight increase of 0.27% [2][13] Securities: Sci-Tech Innovation Board Reforms - The China Securities Regulatory Commission (CSRC) has introduced the "Opinions on Setting Up a Sci-Tech Growth Layer" to facilitate the listing of unprofitable enterprises on the Sci-Tech Innovation Board [3][14] - The new measures include specific requirements for the growth layer's positioning, entry and exit conditions, and enhanced information disclosure [15][16] Insurance: Regulatory Changes - The National Financial Supervision Administration has issued guidelines to regulate dividend insurance, emphasizing the need for companies to justify their proposed dividend levels based on actual asset-liability and investment returns [4][19] - The guidelines aim to reduce competition based on inflated dividend levels and promote a more sustainable approach to dividend distribution [19]