Damo: Regulatory pressure on the insurance industry may be optimistic about insurance needs in the Mainland and Hong Kong due to short-term phenomena

The Zhitong Finance App learned that Damo published a research report saying that recent exchanges with insurance companies and frontline sales channels in Hong Kong and the mainland show that the pressure on bank insurance supervision may only be a short-term phenomenon, and potential demand is still strong. The third-quarter earnings outlook and investment behavior are recent key areas of focus, and it is expected that large insurance companies will continue to expand their market share in 2027.

Damo pointed out that sales momentum was weak in the third quarter, particularly in the banking and insurance sector. This was mainly due to regulatory restrictions and a slowdown in sales after strong growth in the first half of the year. Despite the high base, good start sales were mainly concentrated in the early stages. The bank anticipates that various insurance companies will have different sales targets for a good start in 2027.

Damo said that despite facing fee restrictions, banks are still optimistic that insurance demand will grow faster than the scale of wealth management assets, thanks to strong demand and attractive products. On the asset side, given market fluctuations, some insurers prefer high-dividend stocks, and new asset liability management rules may further guide investment behavior.