The Zhitong Finance App learned that CMB International released a research report saying that premiums in China's life insurance industry returned to positive growth in September, and the bank maintained the view that domestic insurance stocks “outperformed the market.”
The China Financial Supervisory Administration released insurance premium data from January to September. Total premiums rose slightly by 0.9% year on year to 5.26 trillion yuan, and monthly premiums rose 6.6% year on year to 442 billion yuan in September, reversing the downward trend of the past four months. Personal life insurance premiums rebounded 10.5% year-on-year to RMB 291 billion in September, and returned to positive growth, mainly driven by a 14.6% year-on-year increase in life insurance premiums to RMB 225 billion in the same month; the bank expects the fourth quarter to continue to reflect the recovery in life insurance sales, and will be supported by the gradual start of sales in 2027.
The bank pointed out that industrial insurance premiums remained roughly flat at RMB 151 billion in September. Auto insurance and non-car insurance fell 0.2% and increased 0.1% year on year, respectively, and the growth rate slowed from August. Auto insurance was dragged down by weak sales of new passenger cars, while non-car insurance was due to a slowdown in health insurance premium growth (3.2% year-on-year increase in September and 28.9% increase in August). Direct economic losses from natural disasters fell 58% year on year, driving natural disaster compensation down 19% year on year in the third quarter, which is better than market estimates.
The bank maintains its judgment on the transformation of life insurance products to dividends/floating income, and expects premium growth to slow to medium to low units for the full year of 2026; after taking into account weak underwriting in the third quarter, the value growth of listed life insurance companies in 2026 is expected to fall to the number of units. In terms of industrial insurance, the bank maintains the 2026 low premium unit growth forecast, and expects the comprehensive cost ratio of listed industrial insurance companies to improve in the third quarter.
The bank indicates that the valuation of the industry is not expensive. Leading peers forecast P/EV of about 0.19 to 0.47 times and market account ratio of about 0.48 to 0.96 times in 2026, which is close to 1 standard deviation lower than the two-year historical average, and the expected dividend rate of 5% to 7%. The valuation declined markedly in October due to the market taking into account the high base for the third quarter, increased stock market volatility, and the decline in the yield curve. The bank still has a constructive view of supporting the industry's revaluation after the balance and liability matching has been improved, maintaining the industry's “outperforming the market” rating.