As of February 19, the 2023 insurance business income and profit of 9 bank-affiliated life insurance companies have been released with the disclosure of solvency reports.
According to the reporter, in 2023, 9 bank-based life insurance companies will achieve a total of 3,327 insurance business income0.9 billion yuan, a year-on-year increase of 67%。In terms of net profit, 6 life insurance companies achieved profitability, with a total profit of 110.1 billion yuan; 3 life insurance companies lost money, with a total loss of 1641.5 billion yuan.
An interviewed expert told reporters that the overall profitability of bank-based life insurance companies will be under pressure in 2023, which is mainly dragged down by factors such as high handling fees and pressure on the investment side. In the future, on the basis of giving full play to the synergistic advantages with the parent bank, bank-based life insurance companies should avoid over-reliance on the resources and channels of the parent bank, and pay attention to business innovation, risk management, and market expansion to achieve differentiated development.
China Merchants Cigna Life Insurance is the most profitable
Specifically, the top three insurance business income of the above nine bank-based life insurance companies in 2023 are: China Post Life Insurance, ICBC AXA Life Insurance, and CCB Life Insurance, respectively, achieving insurance business income of 10986.6 billion yuan, 4049.5 billion yuan, 3971.3 billion yuan, of which the revenue of China Post's life insurance business increased by more than 20% year-on-year.
In terms of profitability, among the above nine bank-based life insurance companies, China Merchants Cigna Life Insurance, ICBC AXA Life Insurance, ABC Life Insurance, Bank of China Samsung Life Insurance, Bank of Communications Life Insurance, and Sino-Dutch Life Insurance all achieved profitability, with a total profit of 110.1 billion yuan, of which China Merchants Cigna Life Insurance Co., Ltd. was 40.2 billion yuan net profit ranked first. The net profit of ICBC AXA Life Insurance and ABC Life Insurance in 2023 ranked second and third among bank-based life insurance companies, with 35.6 billion yuan, 1$8.4 billion.
From the perspective of loss-making bank-based life insurance companies, three life insurance companies, China Post Life Insurance, CCB Life Insurance, and Everbright Sun Life Insurance, lost money, with a total loss of 1641.5 billion yuan, of which, China Post Life Insurance with 114The loss of 6.8 billion yuan was the first.
On the whole, the contribution of the profit of bank-based life insurance companies to the parent bank in 2023 is low, and some life insurance companies have suffered large losses. In this regard, Lu Min, the former chief insurance business executive officer of Ping An Group and the founder and CEO of Understanding Baohui, told reporters: "In 2023, on the liability side, the bancassurance business of bank-based life insurance companies will face the problem of high handling fees. On the investment side, the overall performance of the industry was unsatisfactory, and investment income was under pressure, resulting in poor profitability of bank-based life insurance companies. ”
Previously, China Post Life Insurance also told reporters that the loss was mainly due to the discount rate of reserves and investment income less than expected.
Wang **, a professor at the School of Insurance of the University of International Economics, said in an interview with reporters that in addition to the above reasons, the competition in the insurance market has intensified in recent years, and the traditional profit model has been challenged, resulting in a decline in the overall profit level. At the same time, some bank-based life insurance companies have a relatively simple product structure, relying too much on certain traditional insurance types, and their profit margins are limited. In addition, some bank-based life insurance companies may have deficiencies in risk management and cost control, resulting in increased losses.
In the future, we need to focus on business innovation
Because of its backing on large and medium-sized commercial banks, bank-based life insurance companies enjoy natural parent bank channels and customer advantages in bancassurance channels. However, at the same time, bank-based life insurance companies also need to innovate on this advantage and avoid relying too much on the resources and channels of the parent bank.
In such a pattern, breaking through the existing bancassurance business model and embarking on a new path of bancassurance business is the biggest challenge for bank-based life insurance companies. Lu Min said.
Zhou Jin, a management consulting partner of PwC China's financial industry, said in an interview with reporters that in general, bank-based life insurance companies are easier to acquire customers and sell with the strong channel advantages and customer base of bank shareholders, and it is easier to solve short-term premium and cash flow problems than other types of insurance companies. In addition, the bank's brand advantage is more likely to win the trust of consumers, and customers will have relatively less concerns about the insurance company's operational soundness and policy payment and payment ability. However, at the same time, the channel advantage of shareholders will also limit the diversified channel layout of bank-based life insurance companies, and the products they sell will have to give more consideration to catering to the preferences of bank customers and bank branch channels, focusing on savings and investment, resulting in low embedded value.
Influenced by their shareholders, bank-based life insurance companies have brand, channel and capital advantages, but some bank-based life insurance companies have risks such as over-reliance on the resources and channels of their parent banks, single business model, and lack of product innovation. There are also some bank-based life insurance companies that have weak capabilities in risk management and compliance. Wang further said that in the future, in the process of giving full play to the synergistic advantages with the parent bank and achieving differentiated development, bank-based life insurance companies should pay attention to business innovation, risk management, market expansion and other aspects of work, and continuously improve their competitiveness.
Lu Min said that bank-based life insurance companies can consider developing online operations. Online operation is the biggest disadvantage of some bank-based life insurance companies. Banks have a huge number of customer resources, but at present, there are fewer and fewer outlets, if the bank-based life insurance company can carry out in-depth cooperation with the parent bank, it can embark on a differentiated development path. Once these disadvantages are overcome, it is believed that domestic bank-based life insurance companies will be able to grow into several of the world's leading insurance companies in the future.