Reporter Chen Jingjing reports from Beijing
"In 2024, the company will deeply understand the spirit of the Central Financial Work Conference, adhere to the business philosophy of 'insurance surname insurance', give full play to the functions of economic 'shock absorber' and social 'stabilizer', lead the company to a new journey of high-quality development with strategy and culture, and strive to build a professional, market-oriented, modern and international world-class insurance company. New China Life Insurance Co., Ltd. (hereinafter referred to as "New China Insurance", 601336. SH) new chairman Yang Yucheng said at the results conference.
"I have been in charge of Xinhua Insurance for about seven months, and now the new party committee has launched a series of reform and development measures to strengthen strategic guidance, we attach great importance to the reform of the system and mechanism, the reform of the construction of the talent team, etc., and will be professional and market-oriented. From the asset side and the liability side, the liability side puts the assessment of value in the first place, and the asset side comprehensively strengthens asset allocation. Yang Yucheng said.
According to the data of the 2023 annual report, the total assets of Xinhua Insurance in 2023 will reach 1.4 trillion yuan, the original insurance premium income will be 165.9 billion yuan, a year-on-year increase of 1.7%, the net profit attributable to shareholders of the parent company will be 8.712 billion yuan, and the value of new business will increase by 65.1% on a comparable basis in one year, and the value growth will exceed expectations.
Regarding the specific reform measures in 2024, Zhang Hong, president of Xinhua Insurance, said in an interview with a reporter from China Business News: " We will strengthen the strategic layout of regional market institutions, guide resources to focus on key regions, and establish a competitive pattern of Xinhua Insurance; promote the layout of professional teams and establish competitive professional teams; take customers as the center to carry out customer hierarchical and refined management, which will focus on the needs of high-end customers, create a set of high-end customer service system, provide good service and product reserves for public customers, and provide insurance benefits; strengthen the professional construction of channel management, cultivate excellent teams in individual insurance channels, and focus on the bank generation channel. Two-wheel drive, group insurance channels focus on corporate customers in key areas, increase the intensity of serving the national strategy, increase product research and development, according to the needs of different customer groups, launch differentiated new insurance products, deepen the reform of the system and mechanism, establish a performance-oriented assessment mechanism in the next step of fine management, in the construction of the cadre team, in accordance with the principle of marketization, the implementation of cadres 'can go up and down', optimize the allocation of financial resources, strictly control the expenditure, and tilt limited resources to important areas. ”
Increase the construction of diversified channels and adjust product strategies
According to the annual report, in 2023, Xinhua Insurance will achieve a premium income of 165.903 billion yuan, a year-on-year increase of 1.7%. Among them, the first-year premium of long-term insurance increased by 31.8% year-on-year, the business structure was optimized, the one-year new business value increased by 65.1%, and the first-year premium rate increased from 5.5% in 2022 to 8.9% in 2023.
From the perspective of business structure, in 2023, the proportion of first-year premiums paid for long-term insurance will be 57.6%, an increase of 11.6 percentage points over the same period of last year, and the proportion of renewal premiums to total premiums will be 73.1%. The first-year premium of traditional insurance and participating long-term insurance accounted for 95.9% of the first-year premium of long-term insurance, an increase of 6.3 percentage points year-on-year.
In terms of individual insurance marketing channels, New China Insurance focuses on the development idea of "achieving value and maintaining the growth of future delivery", adheres to the transformation strategy of "diversification, long-term and high value", accelerates the transformation of the team with excellent performance as the core, returns to the system to lead the team reform, and builds a "professional, professional and elite" sales team.
In 2023, the premium income of the individual insurance channel will exceed 115.5 billion yuan, of which the first-year premium of long-term insurance will be about 11 billion yuan, a year-on-year increase of 9.8%. The number of individual insurance agents is 155,000, and the average monthly per capita comprehensive production capacity is 6,293.7 yuan, a year-on-year increase of 94.4%, and the results of excellent transformation are beginning to show.
Wang Lianwen, vice president of Xinhua Insurance, said at the performance meeting that at the end of 2023, Xinhua Insurance launched a new "Basic Law", no longer driving growth with manpower, but taking the path of connotative growth, and promoting the continuous growth of marketing channels through the construction of a high-performance team. The new "Basic Law" focuses on high-performing individuals and high-performing organizations, emphasizing the improvement of individual capabilities and the need for organizations to be as strong and stable as a "fortress". In order to promote the development of the new "Basic Law", Xinhua Insurance has also strengthened the recruitment standards for newcomers, implemented basic management, and strengthened the honor system.
In terms of bancassurance channels, in 2023, New China Insurance's bancassurance channel achieved premium income of approximately RMB47.8 billion, up 8.9% year-on-year, of which the first-year premium for long-term insurance reached a record high of RMB12.4 billion, up 60.5% year-on-year, and the renewal premium was approximately RMB18.7 billion, up 18.1% year-on-year.
It is reported that in 2023, Xinhua Insurance will promote product switching and adjustment, product optimization and upgrading, further improve products in specific diseases, medical treatment, term life insurance and other segments, and strengthen product supply in key areas such as critical illness, long-term care, personal pension, insurance for small and medium-sized enterprises, and special groups for the elderly and children. As of the end of 2023, the company has a total of 169 products on sale, including 107 health insurance products, 8 annuity insurance products, 20 life insurance products, and 34 accident insurance products.
Gong Xingfeng, Vice President, Chief Actuary and Secretary of the Board of Directors of New China Insurance, said: "The bancassurance channel plays an important role in New China Insurance's channel strategy, an important channel for the company to acquire customers and win its market position, and an important foundation for the company's sustainable development. At the same time, he also said that the profit margin of the bancassurance channel is narrow and the competition is fierce. In the future, we will increase the construction of diversified channels and further improve the scale and quality of marketing channels, including group channels. In terms of product structure, we will further tap the potential of health insurance and pension insurance, achieve a balanced product structure, and reduce the risk of market fluctuations.
Focus on three areas to improve investment performance
According to the annual report, the total assets of Xinhua Insurance will reach 1.4 trillion yuan in 2023, and the investment scale will be about 1.3 trillion yuan. The total investment return on the portfolio was 1.8% and the net return on investment was 3.4%.
Yang Yucheng said that in 2024, it is necessary to improve investment performance and bring rich investment returns to the company, mainly in three directions: "long", "wide" and "deep".
"In terms of 'long-term', we adhere to the concept of long-term investment value investment, allocate long-term assets in a steady and orderly manner, and products with ultra-long-term interest rates have a longer cycle, higher interest rates and more lucrative returns. In terms of 'broadening', we will enrich investment varieties and investment strategies, especially increase the layout of market assets and new quality productivity that are in line with the national strategy and have the characteristics of the new economy, including new infrastructure and new energy, share the dividends of China's new quality productivity, capture the high-quality investment opportunities brought by new quality productivity, and achieve increased investment returns. In terms of 'deepening', we have always emphasized strengthening investment and research, comprehensively building the construction of investment and financing research capacity system, consolidating and improving the company's resource capacity building, and focusing on strengthening the integration of investment and research in different industries and industries. In-depth research and deep mining, focusing on holding good assets, mining and capturing high-quality assets, and achieving excess returns. Yang Yucheng said.
Talking about the issue of interest rate loss, Yang Yucheng further said that the risk of interest rate loss is a topic and problem faced by the entire industry, and Xinhua Insurance hopes to do better in this regard.
Gong Xingfeng said that the volatility of the investment market in 2023 has taught the entire life insurance industry a vivid lesson in the risk of interest rate spreads.
"This lesson is all about the leverage of interest rates, especially for long-term debt. Gong Xingfeng said that we must have a clear understanding of the level of long-term investment returns and interest rates, so we must strengthen the implementation of the concept of long-termism.
"To truly improve the linkage of asset and liability management, to break through the barriers between assets and liabilities, to strengthen the overall leadership of asset and liability management in the company's organizational structure, the company has recently set up a special class for some accounts, such as the establishment of a special class for some dividend product accounts, including the channel department of life insurance, the liability management department, the investment department and the asset management company, to jointly study and judge the future development, the situation of sales on the liability side, and the opportunity for asset allocation on the asset side. The allocation of the situation has formed the linkage of assets and liabilities and broken the separation wall. On the other hand, the debt side effectively reduces the cost of debt, strictly implements the 'integration of reporting and banking', and hopes to reduce sales expenses and other management expenses, and improve management efficiency and innovation. For example, we realize that some products may be more sensitive to interest rates, and we will increase the innovation and sales of profitable products, such as universal and dividend products, so as to change or from a long-term perspective, better manage assets and liabilities and reduce the possible exposure to interest rate loss risks. Gong Xingfeng thinks.
Regarding the specific investment moves in 2024, Qin Hongbo, vice president of Xinhua Insurance, said: "We are optimistic about China's economy, but the market environment is more complex, and we will focus on 'broadening' investment, such as the layout of the primary market, including high dividends and preferred stock allocation opportunities. In addition, it will be evaluated by a more professional and meticulous investment research team, and finally have a reasonable choice of rights and interests. ”
Reform drives connotative growth
According to the reporter's interview, Xinhua Insurance has established the positioning of a diversified financial service group and the core of life insurance, started the construction of a wealth management system on the development path of the main business, researched and explored innovative Internet channel models, clarified the development path of the health care industry in the next step and accelerated it, and is committed to realizing the supply of one-stop financial products.
"We have reversed the past management model centered on channels and modules, strengthened professional and intensive operation, and adhered to the high-quality development of highlighting value and optimizing structure. We have deepened the reform of systems and mechanisms, put more emphasis on system management, explored the establishment of a market-oriented mechanism for selecting and employing personnel, and continuously allocated and strengthened cadres and talents at all levels; gradually optimized the resource management and control system, strengthened the input-output management of costs and expenses, and improved the level of refined management. Yang Yucheng said.
Yang Yucheng pointed out: "On the debt side, we will adjust our strategy to be truly customer-centric, comprehensively enhance the competitiveness of our products, insist on putting the interests of customers first, and strengthen our services to customers." The new 'Basic Law' launched at the end of 2023 strengthens and optimizes the incentives and constraints for the agent's high-performance team, enhances the competitiveness of the agent, comprehensively improves the competitiveness of the agent, and the incentive marketization of the agent is competitive, and the creation of the ecosystem serving customers is being comprehensively optimized and strengthened. Long-term delivery is put in the first place, and quality is insisted on. On the asset side, we are also comprehensively strengthening asset allocation, enriching and improving the types and varieties of investment, and investing in the construction of talent teams, and various tasks are in the process of being implemented. ”
"I believe that Xinhua Insurance will rise, we are full of confidence in the development of Xinhua, after a period of hard work, truly customer-centric implementation, truly professional, market-oriented, internationalization to implement, the company will be better and stronger, in the industry status and ranking will also rise. Yang Yucheng said.
Xinhua Insurance said that the company will maintain its strategic focus, take promoting high-quality development as the theme, deepen the supply-side structural reform as the main line, build a professional talent team as the support, and focus on preventing and resolving risks, adhere to the construction of a customer-centric development system, deepen the reform of the system and mechanism, optimize the regional development layout, accelerate business transformation and digital transformation, and provide products and services that are compatible with the needs of science and technology, green, inclusive, pension and other fields, so as to better meet the needs of the people.
(Editor: He Shasha Review: Zhu Ziyun Proofreader: Zhai Jun)