Summary of Xinhua Insurance Conference Call Company Overview - **Company**: Xinhua Insurance - **Date**: September 17, 2025 Key Points Industry and Business Strategy - Xinhua Insurance adheres to the "promote term with lump-sum" strategy, controlling lump-sum payment amounts within 20 billion, which helps enhance overall business growth despite lower value rates of lump-sum products [2][4] - The company has deepened cooperation with 52 banks, enhancing its customer base and product competitiveness through customized strategies [2][5] - The cancellation of the 1+3 restriction in bancassurance has elevated the strategic importance of this channel for the company [2][5] Financial Performance - In the first half of 2025, lump-sum payments were projected at 10-14 billion, an increase from 11 billion in the same period last year [2][4] - The new business value rate in the individual insurance channel decreased due to a decline in the proportion of 10-year insurance products and an increase in dividend insurance [2][6][7] - Despite the decrease in new business value rate, agent income is expected to grow by double digits in 2024 and continue to increase in the first half of 2025 [2][8] Cost Management and Efficiency - The company has implemented strict cost control measures, optimizing management expenses and allocating more resources to front-end sales and agent commissions [2][8] - The agent commission rate remains largely unaffected, and the agent team has become more solid, with over half of agents having more than five years of experience [2][9] Product Strategy and Market Trends - Following a decrease in the preset interest rate, premium progress was good in July and August 2025, but there was a month-on-month decline in September [2][10] - The company plans to actively develop floating income products to reduce rigid liability costs while continuing to offer traditional fixed-income products for risk-averse customers [2][11] Investment Strategy - Xinhua Insurance has increased its equity market investment ratio to around 20% by the end of 2024, maintaining a stable level in the first half of 2025 [2][12][13] - The company is focusing on diversifying its fixed-income investments and increasing its allocation to low-volatility assets to enhance returns while managing risks [2][12][13] Financial Metrics and Valuation - The company’s net asset value decreased in the first half of 2025 due to negative impacts on other comprehensive income and increased insurance contract liabilities [2][15] - The internal focus is on insurance fund cost indicators, with a downward trend in overall liability costs expected over the next 3 to 5 years [2][11] Dividend Policy - Xinhua Insurance has maintained a stable dividend payout ratio of around 30% since 2016, with a planned cash dividend of 0.67 yuan per share for 2025, reflecting a 24% increase from 2024 [2][17] Conclusion - Xinhua Insurance is strategically positioned to leverage its bancassurance partnerships and optimize its product offerings while managing costs effectively. The company is focused on enhancing its investment strategies and maintaining a stable dividend policy to ensure shareholder value.