CITIC Securities: The long-term upward trend in the insurance industry has not changed, focusing on varieties with dividend advantages
The Zhitong Finance App learned that CITIC Securities released a research report saying that the market style has evolved to the extreme, the insurance sector's performance fluctuated greatly, and the insurance sector's performance was drastically divided in the first half of the year. Overall profit is expected to be under negative growth pressure in the second half of the year, and high-beta varieties may face greater pressure to adjust stock prices. The investment strategy focuses on varieties with dividend advantages. The long-term upward trend of the industry has not changed. The focus is on the resource advantages and service capacity building of leading companies, which will become the core competitiveness in the future. Focus on local piloting of commercial insurance and health insurance collaborative policies and implementation nationwide, which is expected to drive health insurance to continue to grow.
CITIC Securities's main views are as follows:
The performance of insurance companies was sharply divided in the first half of the year, and the market is expected to pay more attention to performance stability and dividend sustainability in the second half of the year.
The short-term performance differentiation in the insurance sector is mainly due to significant differences in the equity positions and position styles of various companies, leading to differences in quarterly profit elasticity. Influenced by equity asset holding ratios, holding styles, and accounting methods, under the extreme style of the stock market, the interim reports and short-term performance of various companies are clearly differentiated, and targeted judgments need to be made based on the market style. The ultimate technology stock style for the second quarter of 2026 is already fully reflected in the results. The bank expects the insurance sector to face the impact of a high base and market style change in the second half of the year. The short-term focus will return to long-term sustainability of balance and liability matching, stability of core capital and equity positions, debt cost control, increased insurance policy value ratio, and new debt-side business value growth.
In the long run, the long-term upward cycle of the insurance industry has been established, and key indicators such as new insurance premiums, new business value, total investment assets, and total assets of the industry are expected to maintain a double-digit growth rate for a long time.
The core driving force for long-term growth is that the comparative advantage of dividend insurance and other products is highlighted in a low interest rate environment, and stricter superimposed regulations have accelerated the concentration of market share in leading companies. Strict supervision and anti-domestic laws have intensified the trend of homogenization of insurance products, and there is little difference between product yield and cost ratio.
In the context of an aging population and financial pressure, large insurers are shifting competitive barriers from product benefits to service capacity integration through deep participation in the construction of public service systems such as health care and pension. This trend is expected to continue for 3-5 years. At the same time, declining debt costs and steady asset-side allocation (additional long-term treasury bonds, high dividends, and participation in the southbound flow of Hong Kong bonds) guarantee the sustainability of interest spreads, and the profitability of leading companies is highly certain. Savings deposit transfers and market share concentration are expected to drive the industry to maintain a double-digit growth rate of indicators such as new policy premiums, new business value, and total assets.
The collaborative promotion of medical insurance and commercial insurance has become a catalyst for health insurance and the sector.
Since 2026, China's health insurance commercial insurance collaborative policy system has been improved at an accelerated pace, and top-level design and implementation practices are working in both directions. At the strategic level, on July 13, the State Council issued the “Fifteenth Five-Year Plan for National Health” (Guofa (2026) No. 23), which clearly establishes a full-life cycle health service system, strengthens collaboration in medical care insurance and disease control, vigorously develops the health industry, and provides programmatic guidelines for the construction of a multi-level medical insurance system.
At the implementation level, on May 31, the National Health Insurance Administration issued the 2026 drug catalogue adjustment work plan. It is the second round of “double catalogue” collaborative adjustments after the implementation of the first edition of the commercial insurance innovative drug catalogue in 2025. It adheres to the adjustment ideas of filling up shortcomings, optimizing the structure, and encouraging innovation, and strengthens the linkage effect between strategic medical insurance purchases and supplementary commercial insurance coverage.
Beijing and Shanghai took the lead in forming a differentiated implementation paradigm, which is expected to be promoted nationwide in the future.
In February 2026, 9 departments including the Beijing Municipal Health Insurance Administration jointly issued “Certain Measures to Support the High-Quality Development of Commercial Health Insurance in Beijing”, focusing on system integration and protection gradient construction:
1) Promote the integration of medical insurance and commercial insurance services: support the replication and promotion of the country's first “medical insurance+commercial insurance” settlement center in Xicheng District (launched in July 2025, already piloted in the top three hospitals including Peking Union Medical College Hospital) to achieve “settlement and settlement” - direct claims are settled on the spot, and payments can be completed as soon as two or three days; simultaneously upgrade the 2026 “Beijing Inclusive Health Insurance”. The list of specialty drugs was expanded to 159, covering 87 types of diseases. For the first time, cutting-edge treatments such as CAR-T were lowered and increased reimbursement amounts. Proportion.
2) Open up barriers for innovative drugs to enter hospitals: Build a normalized docking platform between commercial insurance companies and innovative pharmaceutical companies. Commercial insurance innovative drugs can follow the green channel and quickly connect to the Internet. They are not included in the medical insurance self-rate assessment and are not restricted by “one product, two regulations”. Eligible new drug technology expenses are not included in DRG patient group payment standards or paid separately, eliminating the assessment concerns of hospitals using high-value innovative drugs.
3) Form a replicable model: Relying on clearing and settlement centers to open up data and settlement barriers for health insurance commercial insurance, providing a model for the construction of a national multi-level medical insurance system.
Shanghai has moved from system construction to closed loop payment implementation, and data sharing, innovative payment, and drug entry mechanisms are being implemented at an accelerated pace.
On July 29, 2025, 7 departments including the Shanghai Financial Supervisory Authority jointly issued “Certain Measures to Promote High-Quality Development of Commercial Health Insurance and Help Innovation in the Biomedical Industry” (Shanghai Jinfa (2025) No. 43), forming a “closed loop of data enabling+innovative payment” paradigm:
1) Optimize the commercial insurance mechanism for purchasing funds from past year balances in individual health insurance accounts, promote individual accounts to support group health insurance, and provide “one-code insurance” and direct compensation services;
2) Explore the insurance industry's co-insurance model and risk regulation mechanism for multi-year operating cost calculation, promote collective drug price negotiations, payment according to efficacy and installment payments, and promote full coverage of secondary and tertiary hospitals on the basis of the existing medical insurance simultaneous settlement platform (launched in July 2024 and full access to the first batch of 12 top three hospitals at the end of September) to achieve direct integration within high-value innovative pharmacies;
3) Deepen the sharing of medical, medical insurance, and commercial insurance data on the premise of data security and privacy protection, support the inclusion of the elderly, people with pre-existing medical conditions and chronic diseases, and use a “regulatory sandbox” pilot with sickness insurance to fill gaps in coverage. In 2026, Shanghai will enter the implementation stage: the 2026 edition of “Shanghai Huibao” was expanded to 50 types of domestic specialty drugs and included in domestic CAR-T products for the first time; the first edition of the commercial insurance innovative drug catalogue achieved full admission and full coverage in municipal hospitals; superimposed the new policy orientation of national commercial insurance exploration and medical insurance relay to open up a gradient entry channel from the commercial insurance catalogue to the medical insurance catalogue.
Risk factors:
Insurance companies' profits experienced negative growth due to stock market fluctuations and high base figures; the growth rate of insurance policy sales declined as the base effect increased; interest rates continued to decline in the medium to long term.