Core Viewpoint - The low interest rate environment is a fundamental challenge facing the Chinese insurance industry, driving a deep transformation in asset allocation strategies to address pressures on interest spreads, solvency, and liquidity [1][2]. Group 1: Historical Context of Low Interest Rates - China has experienced four notable low interest rate cycles since the reform and opening up, each associated with specific economic and financial conditions [5]. - The current low interest rate cycle began in 2019, exacerbated by economic downturns and the impact of the pandemic, indicating a potentially prolonged period of low rates [6]. Group 2: Current Asset Allocation Trends - Despite low interest rates, the total assets of the insurance industry have continued to grow, surpassing 40 trillion yuan, with an expected balance of nearly 40 trillion yuan in funds by year-end [7]. - The industry has increased its allocation to long-term bonds and medium to long-term deposits to stabilize income and enhance returns from fixed income investments [8]. - Equity investments have also seen steady growth, particularly in stocks and stock funds, with a significant increase of 85% since the end of the 13th Five-Year Plan [9]. - Alternative asset allocations have decreased, with private debt investments notably declining, reflecting challenges in the market [10]. Group 3: Market Risks and Changes - New market risks have emerged, including stock market volatility and concentrated investments in certain sectors, necessitating careful evaluation of long-term profitability [11]. Group 4: Comparative Analysis of International Practices - International strategies for low interest rate environments typically involve increasing equity investments and diversifying into alternative assets, but these strategies have not been fully realized in the domestic market due to unique local conditions [12][13]. Group 5: Future Outlook and Strategic Measures - The insurance industry faces a complex external environment with both challenges and opportunities, necessitating a focus on high-quality development and adaptation to changing market conditions [14]. - Eight strategic measures have been proposed to navigate the low interest rate environment, including enhancing cost control, optimizing fixed income strategies, and promoting innovation in asset management products [15][16][17].