Core Viewpoint - The insurance industry is preparing for a significant shift in product pricing and interest rates, with a transition to a new rate environment expected by August 31, 2025, leading to increased urgency among agents and companies to adjust their offerings [1][2][6]. Group 1: Industry Dynamics - Insurance agents are actively engaging with clients to discuss the implications of the upcoming product rate changes, with many reporting an increase in sales activity as clients seek to secure policies before the adjustments take effect [2][5]. - The transition to a new interest rate environment is prompting insurance companies and sales platforms to prepare for the discontinuation of existing products, with many platforms announcing the removal of numerous insurance products by the end of August [4][6]. - The insurance sector is experiencing a notable increase in large policy sales, with agents reporting significant transactions, including policies with premiums reaching millions [2][5]. Group 2: Product Adjustments - The upcoming shift will see the discontinuation of existing products with a guaranteed interest rate of 2.5%, marking a transition to a new standard of 2.0% [6][7]. - New products are being introduced to adapt to the low-interest-rate environment, with companies like Tongfang Global Life and China United Life launching dividend-type life insurance products with a predetermined rate of 1.5% [6][7]. - Dividend insurance is expected to become the mainstream product following the rate adjustment, as it offers a more attractive return profile compared to traditional fixed-rate products, which are becoming less sustainable in the current market [7][8].

Core Viewpoint - The recent reduction in the guaranteed interest rate for insurance products has sparked significant discussion, with the new rate for Tongfang Global Life's product dropping to 1.5%, reflecting a broader trend in the industry towards lower guaranteed returns [1][2]. Group 1: Industry Trends - Multiple insurance companies, including Zhongyi Life and Heng'an Standard Life, have launched dividend insurance products with a guaranteed interest rate of 1.5% [2]. - The latest LPR data shows a decrease in the 1-year LPR to 3.0% and the 5-year LPR to 3.5%, indicating a downward trend in market interest rates [2]. - The China Insurance Industry Association is set to regularly assess and adjust the guaranteed interest rates for life insurance products based on market conditions, including LPR and deposit rates [2][3]. Group 2: Impact on Investors - The reduction in guaranteed interest rates is expected to lower the cost of liabilities for insurance companies, potentially improving the industry's fundamentals, but it directly leads to reduced guaranteed benefits for investors [4]. - Investors are increasingly considering alternative products due to the declining guaranteed returns from insurance products, which are perceived to have lower liquidity [4]. - Despite the lower guaranteed rates, dividend insurance products remain attractive due to their potential for higher returns, with over 150 out of 400 new insurance products launched this year being dividend products, accounting for nearly 40% [5]. Group 3: Future Outlook - Analysts predict that the guaranteed interest rates for traditional insurance products may decrease from 2.5% to 2.0% in the third quarter of this year, reflecting ongoing market trends [3]. - The insurance industry may shift towards selling dividend insurance products that offer lower guaranteed rates but potential for floating returns, increasing sales pressure on companies [4].