After a slowdown in 2009, China’s
life insurance market is again on a strong growth track, reveals
data for the first three quarters of 2010 released by the China
Insurance Regulatory Commission (CIRC).
From a profit perspective, however,
the third quarter produced disappointing growth from the life
industry’s big-three.
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According to the CIRC, life
insurance premium income in the first nine months of the year
increased by 33.2%, compared with the same period in 2009, to
CNY762.5bn ($114bn). This growth rate was almost identical to the
33.4% increase reported in the first half of 2010.
In 2009, China’s life insurance
industry recorded a 47.8% increase in premium income compared with
2008. This marked the slowest growth since 2004, when a 5.7%
increase was recorded. Between 2000 and 2009, the insurance
industry premium growth achieved a CAGR of 27.2%.
General insurers also enjoyed
strong premium growth in the first three quarters of 2010 with
premium income increasing by 32.3%, compared with the same period
in 2009, to CNY295.5bn.
In the first nine months of 2010,
China’s largest life insurer China Life reported premium income of
CNY256.9bn, based on recently introduced accounting principles. On
the old accounting basis, the insurer’s premium income was
CNY268.2bn, up 13% compared with the same period in 2009.
Less impressive was China Life’s
bottom line performance, which reflected net profit in the first
nine months of 2010, growing by a minimal 6.3% compared with the
first three quarters of 2009 to
CNY24.95bn. Net profit in the third quarter of CNY6.9bn was up 3.4%
compared with the third quarter of 2009.
China’s second largest life insurer
Ping An continued to gain ground on its larger rival in the first
three quarters of 2010, increasing life insurance premium income by
almost 25% to CNY59.67bn. For the nine months, Ping An reported
general insurance premium income of CNY45.5bn and health insurance
premium income of CNY139m.
Ping An’s net income for the first
nine months came in at CNY12.76bn, up 8.8% compared with the same
period in 2009. Results were hit by third-quarter net income which
fell 26%, compared with the third quarter of 2009, to
CNY3.15bn.
Also performing well from a sales
perspective was China Pacific Insurance (CPI) with its life
insurance unit, China’s third-largest, reporting premium income
based on the new accounting standard of CNY68.9bn in the first nine
months of 2010.
On the old accounting standard,
CPI’s life insurance premium income was up 43% compared with the
first nine months of 2009. CPI’s general insurance premium income
reflected growth of 45%.
CPI increased net profit in the first nine months of 2010 by
almost 21% to CNY4.91bn. This was despite a slump in third quarter
net profit, which fell 64% compared with the third quarter of 2009,
to CNY886m.
