Chinese life insurance market records growth slowdown

Written by Michael Griffiths

23/06/2025

China’s life insurance sector has experienced slower growth amid business transformation, while the country’s non-life sector growth remains driven by initiatives from its Government, Fitch Ratings has stated.

Premiums in the life and non-life sectors increased by 1% and 5% year-on-year, respectively, in the opening four months of 2025.

Fitch suggested that life insurers are shifting towards participating products with lower guaranteed rates to mitigate negative spread risk amid a continued low-rate environment. However, the credit rating agency said this has made the products “less attractive”.

Government and insurance regulatory initiatives should support demand for motor insurance and certain non-motor insurance products, Fitch added, although the group warned that tariff and trade tensions may challenge the sector’s growth outlook.

“We expect life insurers to see greater financial performance volatility than non-life insurers, as the former have increased investments in stock and long-term equities in pursuit of higher returns, driven by persistently low long-term bond yields and regulatory incentives to raise equity holdings,” a Fitch statement said.

“Operating performance of the non-life sector should remain stable, supported by disciplined underwriting, continued efforts to strengthen pricing capabilities and cost control.

“The regulatory solvency position of the life and non-life sectors should remain steady. However, capital replenishment through debt issuance will continue for insurers with aggressive investment risk appetites and for business expansion.”

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