From Premiums to Unsold Auctions: The Myth of Insurance Company Licenses Shattered

21st Century Business Herald reporter Lin Hanyang, intern Tu Shengqing

Recently, the performance of equity held by insurance intermediary institutions on judicial auction platforms has continued to slump. The “insurance intermediary licenses” that once attracted capital are now clearly cooling off.

Since March 2026, on Alibaba Assets’ judicial auction platform, multiple pieces of equity held by insurance intermediary institutions have entered auction or liquidation processes, including the 10% equity interest in Shenzhen Sheng’an Insurance Brokerage Co., Ltd., the 100% equity interest in Baocheng Insurance Sales Co., Ltd., the 90% equity interest in Guizhou Zhongyang Insurance Agency Co., Ltd., and more. Although some projects have attracted a fair number of onlookers, there are not many people who actually register to participate in the bidding, and auctions failing to sell are frequent.

From “scarce resources” that capital once competed to chase a few years ago, to the present situation where no one even shows interest despite repeated price cuts, the insurance intermediary industry is moving from the early stage of “relying on license windfalls” into a mature stage centered on capabilities and efficiency.

Regarding these changes, Zhu Junsheng, a professor and postdoctoral researcher in applied economics at Peking University, believes this is not simply cyclical fluctuation, but a deep reshaping driven jointly by regulation, the market, and the capability structure. In the short term, it is institutional clearing out and profit pressure; in the medium to long term, it is the industry’s process of evolving toward professionalization, concentration, and value creation.

“Intermediary institutions that can truly get through the cycle will no longer rely on fee windfalls. Instead, they will build sustainable long-term value by leaning on customers, capabilities, and services,” Zhu Junsheng said.

Insurance intermediary equity cools off

(Source of image: Alibaba Assets platform)

Based on recent publicly available information, the cooling of insurance intermediary equity transactions is not a single case, but a fairly common market phenomenon.

According to incomplete statistics, in the past two years, the auction failure rate of insurance intermediary equity on the Alibaba Assets platform has exceeded 50%. Only since March 2026 alone, at least five insurance intermediary institutions’ equity interests have been put on the auction block. Most starting prices are in the tens of millions of yuan range, and the overall market response has been muted.

Alibaba Assets’ publicly disclosed information shows that the 10% equity interest in Shenzhen Sheng’an Insurance Brokerage Co., Ltd. was publicly auctioned in mid-March 2026. The starting price was 3.0336 million yuan, with 439 times of viewing and 0 registrations.

The 100% equity interest in Baocheng Insurance Sales Co., Ltd. will be liquidated on April 1 with a starting price of 6.3777 million yuan, with 501 times of viewing and 0 registrations.

The 90% equity interest in Guizhou Zhongyang Insurance Agency Co., Ltd. was auctioned with a starting price of 3.0720 million yuan; this is the second time this asset has been listed.

For Jianjian Insurance Brokerage’s 100% equity interest, this year it has already been its 6th time on the auction block. The starting price has dropped from 50 million yuan down to 16.384 million yuan.

(Source of image: Alibaba Assets platform)

Some insurance intermediary institutions that have been auctioned have shown signs of operational irregularities.

According to the auction announcement, Guizhou Zhongyang Insurance Agency has been included in the list of business anomalies. The issuance date of its “Insurance Intermediary License” was June 28, 2022. The announcement specifically notes: “Due to the company’s long-term failure to operate, no commitment is made regarding the validity or usability of this license.”

The auction description for Jianjian Insurance Brokerage Co., Ltd. shows: “According to feedback from Jianjian Digital Security Technology Group Co., Ltd., the registered capital of 50 million yuan has not actually been paid in. Due to inability to contact Jianjian Insurance Brokerage Co., Ltd. through the registered domicile or business premises, Jianjian Insurance Brokerage Co., Ltd. was included in the list of business anomalies on September 24, 2024.”

From “license mythology” to rational pricing

If we rewind the timeline to a few years ago, insurance intermediary licenses were a hot commodity in capital markets.

Around 2017 to 2020, equity transactions involving insurance intermediaries were once highly active. At that time, the market quotes for national insurance brokerage licenses generally ranged from 30 million yuan to 40 million yuan. The auction market for insurance intermediary equity rarely saw auctions fail to sell. Some quality assets even managed to trade at a premium. For example, in 2017, the 20% shareholder equity interest of Sichuan Jiao’tou Chengtai Insurance Brokerage was auctioned with a starting price of 2.612 million yuan and ultimately sold for 4.312 million yuan.

Behind this heat was the “license windfall.” On one hand, from 2018 to 2023, regulatory departments suspended approvals for insurance intermediary license applications. With supply tightened, licenses had stronger scarcity. On the other hand, at the time, the industry’s expense space was relatively large, and “reporting and filing compliance” had not yet been fully implemented. Some intermediary institutions relied on commissions and the spread between fees to generate substantial returns.

However, in just a few short years, this situation has been fundamentally reversed. When asked by reporters, Zhu Junsheng pointed out that recently, the price of insurance intermediary licenses has fallen from around 30 million yuan to about 10 million yuan, and equity transactions frequently fail to sell—reflecting a systematic reappraisal by capital of the value of licenses.

This change first stems from a clear decline in license scarcity. Zhu Junsheng analyzed: “As industry concentration increases and channel policies gradually become unified, the license’s role as an entry barrier weakens. The value it carries—‘easy profits’ or ‘channel value’—has clearly dropped. Licenses are gradually returning from ‘scarce assets’ to ‘operating tools.’”

Second, Zhu Junsheng said that market profit expectations have also changed. Policies such as “reporting and filing compliance” have compressed commission levels and fee space, reducing intermediaries’ short-term cash flow and expected investment returns, which directly affects capital pricing logic. In addition, investment logic has become more rational: the capital market is paying more attention to intermediaries’ long-term operating capability, customer resources, and professional service capability—not merely to holding the license itself.

Zhu Junsheng said that from an academic perspective, this change marks the intermediary industry moving from the initial stage of “relying on license windfalls” into a mature stage centered on capabilities and efficiency.

“Clearing to improve quality” accelerates industry cleanup

The cooling of insurance intermediary equity auctions is closely related to ongoing industry cleanup in recent years.

On February 27, 2026, the National Financial Regulatory Administration disclosed that from 2024 to 2025, across the country, a cumulative total of 3 insurance intermediary groups were investigated, with licenses revoked or deregistered; 57 insurance professional intermediary法人 (legal person) institutions were handled; and 3,730 insurance professional intermediary branches were cleared out, along with 226 insurance兼业代理 (mixed/dual-purpose) agency institutions. By the end of 2025, the number of insurance professional intermediary legal-person institutions had fallen to 2,513, declining for 6 consecutive years.

The National Financial Regulatory Administration said that next steps will focus on the main lines of preventing risks, strengthening regulation, and promoting high-quality development. It will earnestly carry out insurance intermediary supervision, improve the regulatory system for insurance intermediaries, continuously and deeply promote “clearing to improve quality,” and optimize the structure of the insurance intermediary market.

In an interview, Zhu Junsheng further explained the deep impact of regulatory policies on intermediaries’ profit models. He pointed out that the current changes in insurance intermediary profit models are, in essence, a transformation of the industry from “extensive expansion” to “high-quality development,” driven primarily by three areas: policy, the market, and institutional capabilities.

First, from the policy perspective, regulatory policies represented by “reporting and filing compliance” are reshaping the profit foundation of intermediary institutions. Commission structures, channel fees, and transparency across the entire value chain have improved significantly. The old model that relied on high commissions and arbitrage from fee spreads can no longer be sustained. Once expenses are rigidly constrained, intermediaries can no longer obtain profits through “fee space,” and must instead rely on real service value and clients’ operational capability. Fundamentally, this change is pushing the industry from “fee-driven” to “capability-driven.”

Second, from the market perspective, requirements on insurance companies are steadily increasing in areas such as multi-channel deployment, product differentiation, and cost control. Market competition is gradually shifting from price-led competition to structural competition. In this context, profit space for intermediary channels is compressed, and small and mid-sized institutions face obvious profit pressure. When revenue cannot cover the continuously rising compliant and operational costs, some institutions choose to exit—becoming a rational outcome.

Third, from the standpoint of institutional capabilities, intermediaries lacking customer operations, data accumulation, risk management, and digital capabilities cannot sustain their business models. After fee windfalls disappear, these institutions lack alternative competitive advantages, and their survival space shrinks significantly.

Zhu Junsheng believes that the “unsustainability” of some intermediaries today is not caused by a single policy shock, but is the result of the combined effects of tighter policies, market rationalization, and a divergence in capabilities. This clearing process helps optimize industry structure and gradually move the intermediary market toward professionalization and the creation of long-term value.

Capital shifts from “buying licenses” to “buying capabilities”

As many small and mid-sized intermediary institutions exit and license value shrinks, some industrial capital is still actively laying out insurance intermediary business, and industry differentiation is accelerating.

In the past two years, automakers have become increasingly active in the insurance intermediary track.

In 2025, BMW was approved to establish BMW (China) Insurance Brokerage Co., Ltd. Great Wall Motor entered the insurance intermediary market by acquiring Zhaoyin Insurance Brokerage (Beijing) Co., Ltd., and later renamed it to LaoYou Insurance Brokerage Co., Ltd. After completing its acquisition of Huanding Insurance Brokerage, XPeng renamed it to XPeng Insurance Brokerage Co., Ltd.

Besides automakers, large institutions with channel, scenario, or industrial synergy advantages are also speeding up their layouts. In November 2025, the National Financial Supervision and Administration Bureau approved and agreed for China Post Group to carry out insurance agency business. Earlier, Chow Tai Fook’s related company had already completed the acquisition of all equity of Zhongjie Insurance Brokerage.

Judging from overall market performance, the business scale of insurance intermediary channels has not shrunk, and premium income is still growing. According to data from the “China Insurance Yearbook 2025,” in 2025, insurance intermediary channels generated premium income of 5.1 trillion yuan, up 5.9% year over year on a comparable basis. Of this, premiums from the professional intermediary channel were 962.3 billion yuan, up 10.4%; premiums from mixed/dual-purpose agency institutions were 1.74249 trillion yuan, up 4.5%.

But the growth in premium income cannot conceal structural differentiation. Zhu Junsheng pointed out that intermediary institutions that still find equity attractive typically have the following characteristics: first, they have stable and sustainable customer resources (such as corporate clients or high-net-worth customers); second, they have professional service capabilities (such as risk management or industry solutions); third, they have certain digital capabilities or platform attributes; fourth, they have formed differentiated advantages in specific sub-sectors.

Zhu Junsheng emphasized that, overall, capital entering the insurance intermediary industry is shifting from “buying licenses” to “buying capabilities.”

The industry moves toward professionalization, concentration, and value creation

Against the backdrop of reshaped profit models and rising operating costs, insurance intermediary institutions must find new growth drivers. Zhu Junsheng believes its core direction is to shift from “scale expansion” to “value creation.”

On one hand, intermediary institutions need to move from simply selling products to providing risk management and integrated services. For example, in high-growth C-end markets such as retirement and health, by offering professional consultation, risk assessment, and long-term services, they can enable deeper customer operations and higher renewal rates.

On the other hand, they should leverage digital tools to improve operational efficiency and reduce customer acquisition and service costs, thereby strengthening profitability across cycles.

At the same time, integrating product resources from multiple insurance companies to provide customers with diverse and personalized solutions can also help form professional barriers.

In addition, strengthening coordinated cooperation with insurance companies—shifting from traditional “channel relationship” toward “value co-creation relationship”—will also become an important direction.

In terms of industry structure, Zhu Junsheng expects that as institutions clear out and license value becomes rationalized, the concentration level in the insurance intermediary industry is likely to continue rising; the exit pace of small and micro institutions will accelerate; and the advantages of leading and professional institutions will be further reinforced. Looking long term, the industry will gradually form a tiered structure centered on professional capability, customer operation capability, and digital capability. Service quality will differentiate, and the market share and customer stickiness of high-level institutions will increase noticeably.

Going even further, Zhu Junsheng noted that the functional positioning of the intermediary industry is also changing: from the traditional policy (insurance policy) sales channel, it will gradually evolve into a “customer operations and value creation center.” In the future, it is expected to become an important node connecting insurance companies, health management, retirement services, and technology platforms.

Zhu Junsheng believes that the current adjustment in the insurance intermediary industry is not a simple cyclical fluctuation, but a deep reshaping driven jointly by regulation, the market, and the capability structure. In the short term, it is institutional clearing out and profit pressure. In the medium to long term, it is the industry’s process of evolving toward professionalization, concentration, and value creation. In this process, intermediary institutions that can truly get through the cycle will no longer rely on fee windfalls; instead, they will rely on customers, capabilities, and services to build sustainable long-term value.

(Editor: Qian Xiaorui)

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