Annual Report Observation | Traditional insurance contributes half of the premiums; when will dividend insurance "rise to prominence"? Industry insiders: It will take another three to five years of gradual replacement cycle

Ask AI · What customer perception barriers must dividend insurance overcome to become the mainstream of life insurance?

Everyday Economic News Reporter: Yuan Yuan Everyday Economic News Editor: Liao Dan

Dividend insurance has been the “darling” of the market in recent years, with its “fixed + floating” mechanism design, which can both reduce the rigid costs for insurance companies and allow customers to share in the company’s operational results, making it one of the key products developed by various insurance companies.

Recently, at the performance release conferences of the five major listed insurance companies, management also revealed that vigorously developing dividend insurance has become a common choice among leading listed life insurers. However, based on the product information for 2025, traditional insurance products such as non-dividend whole life insurance and endowment insurance, with their large renewal premium bases, still contribute the most and firmly occupy the top position in premium income.

However, under the dual drive of regulatory guidance and proactive transformation by insurance companies, dividend insurance is undoubtedly moving from a supporting role to the main stage. How far is it from becoming the “top dog” in life insurance?

Strategic Level: Dividend Insurance Becomes the “Must-Answer Question,” Insurers Fully Promote Business Transformation

By 2025, the persistently low interest rate environment will continue to squeeze insurers’ profit margins, with interest margin loss risks hanging like the Damocles sword over the industry. Against this backdrop, dividend insurance, with its “guaranteed minimum return + floating dividends” design, can both reduce insurers’ rigid liability costs and meet customers’ asset appreciation needs through floating returns, making it a common choice among most insurers, including the top five listed insurers.

From the annual reports, “dividend insurance” and “floating return products” have become keywords. China Life mentioned in its annual report that the transformation of floating return business has been remarkable, with the rigid cost of new business liabilities steadily decreasing for three consecutive years. In 2025, dividend insurance accounted for nearly 60% of the first-year premium of individual insurance, becoming an important support for new single premiums.

Last year, China Ping An’s dividend insurance scale premium reached 91.89B yuan, a year-on-year increase of 41.28%; China Taiping Life’s new premium for dividend insurance in the renewal period increased to over half, with 61.4% of new premiums through agents being dividend insurance; New China Insurance fully launched its dividend insurance transformation, achieving a first-year premium of 11.93B yuan for long-term dividend insurance, with substantial product transformation breakthroughs.

“By 2025, the company will firmly promote the transformation of dividend insurance, mainly reflected in breakthroughs in sales, with annual dividend insurance sales reaching 12 billion yuan,” said Gong Xingfeng, President of New China Insurance, at the performance briefing. He added that New China Insurance has intensified its transformation efforts since Q2 and Q3 last year, achieving expected results. In 2026, the company will continue to deepen the transformation, focusing on expanding product types, such as increasing the sales of dividend annuities and leveraging policy dividends in health insurance.

Recently, Fu Xin, Vice President and Chief Financial Officer of China Ping An, also told the “Daily Economic News” that in 2025, the dividend insurance business in the individual channel will account for about 30%, and in 2026, dividend insurance will be the core product promoted throughout the year, with its share expected to further increase.

Reducing interest margin loss risk is one of the purposes of insurers actively transforming into dividend insurance. Fu Xin said that increasing dividend insurance business is an inevitable choice for insurers to adapt to the current low-interest-rate market environment. From the customer perspective, dividend insurance allows policyholders to share excess investment returns of the insurance company. During a declining interest rate cycle, such products’ competitive advantage becomes more prominent; from the insurer’s operational perspective, focusing on dividend insurance can effectively hedge against interest rate fluctuation risks, optimize liability cost structures, and provide more flexible equity asset allocation space for funds, helping companies achieve long-term stable investment returns.

Structural Level: Traditional Insurance “Solid Foundation” Still Tops the Main Selling Products List

Although the new single market is rapidly penetrated by dividend insurance, in terms of total premium income (new + renewal), non-dividend traditional insurance still remains the “ballast stone” for the five major insurers. This contrast mainly stems from the base effect of renewal premiums—traditional insurance, after decades of development, has accumulated a vast stock of policies, with large renewal premium scales each year, while dividend insurance has only recently restarted high growth, with a relatively small stock base.

Specifically, in 2025, Taiping Life’s traditional insurance premium scale was 187.52B yuan, accounting for 63.38% of the company’s total premium; China Ping An’s traditional life insurance premium reached 231.11B yuan, and its annuity insurance premium reached 108.16B yuan, with the combined share reaching 51.29%; New China Insurance’s original insurance premium income for traditional insurance was 106.69 billion yuan, accounting for 54.47%; PICC Life’s ordinary life insurance original premium income was 92.9B yuan, accounting for 73.7%.

Moreover, last year, the top five insurance products by premium income among the five major life insurers were all traditional insurance products, with most of the top five products also being traditional insurance. Specifically, the highest premium income product was China Life’s Guoshou Xinxiang Future Endowment Insurance, with a total premium of 37.04B yuan; Ping An Life’s Ping An Shengshi Jinyue (Premium Edition) whole life insurance, with a total premium of 29.8B yuan; Taiping Life’s Changxiangban (Chuan Shi Edition) whole life insurance, with a total premium of 17.18B yuan; New China Insurance’s Fusheng Shiji Family Whole Life Insurance, with a total premium of 18.18B yuan; PICC Life’s PICC Life Ruyi Fu Endowment Insurance, with a total premium of 15.3B yuan.

“Traditional insurance continues to maintain its dominant market position mainly because, during a declining interest rate cycle, customers’ hedging demand for certain returns and insurers’ risk mitigation strategies resonate strongly,” said Yang Fan, General Manager of Beijing PaiPaiWang Insurance Agency Co., Ltd., to the “Daily Economic News.” He explained that under the current macroeconomic environment, customers’ risk appetite has decreased, and they prefer locking in long-term guaranteed returns, which traditional insurance products can precisely meet. Meanwhile, despite the pressure on transformation, the long-standing sales inertia and reliance on high-certainty products at the channel level make traditional insurance still highly sticky on both supply and demand sides. This is not due to a single factor but results from a phased balance between market choices and risk control strategies.

Looking Ahead: Dividend Insurance Will Take 3 to 5 Years to Become the “Top Card” of Insurers

In the context of persistently declining interest rates, vigorously developing dividend insurance with floating return mechanisms is a consensus among the five major listed life insurers and industry players.

Entering the first quarter, this trend continues. Guoxin Securities’ research report mentioned that in Q1 2026, the sales heat of dividend insurance across multiple channels significantly increased, especially favored by middle-aged and elderly savers and conservative investors. Bank agency channels, as the main outlet for deposit transfers, showed a notable rise in dividend insurance share, with some insurers even experiencing product quota shortages.

However, in terms of overall business scale, dividend insurance still needs some time to surpass non-dividend traditional insurance. “The current bottleneck for the growth of dividend insurance mainly lies in the lagging customer perception and the insufficient professional service capabilities on the supply side—these two factors are mutually causal,” Yang Fan said. From the demand side, customers’ long-term “guaranteed return” mindset causes misperceptions about the “non-guaranteed return” part of dividend insurance, and recent fluctuations in dividend realization rates have increased wait-and-see sentiment; from the supply side, the sales force is in a painful transformation phase, lacking the professional ability to shift from simply selling “fixed income” to explaining “investment logic,” making it difficult to effectively guide customer expectations, resulting in a structural disconnect between supply and demand.

In Yang Fan’s view, it will take roughly 3 to 5 years of “gradual replacement” for dividend insurance to replace traditional insurance as the “top card,” rather than a rapid policy-driven switch. This process will naturally evolve with the dynamic adjustment of the guaranteed interest rate. As traditional insurance prices weaken with falling interest rates, dividend insurance will demonstrate an advantage in crossing interest rate fluctuations over the long term. The market will gradually shift from a “fixed income mindset” to an “equity mindset,” which requires time to build market trust and verify investment capabilities, and cannot be achieved overnight.

Additionally, in the rapid promotion of dividend insurance, insurance institutions must thoroughly reshape their core channel competitiveness, shifting from a single “product push” to an “asset allocation advisor” model. They should reverse the focus on scale and light on value, establishing evaluation mechanisms oriented toward long-term investment ability and dividend realization rates, and improving product transparency. On the channel side, high-intensity training should be provided to empower agents with the professionalism to explain macroeconomic trends and complex products, offering comprehensive wealth management services throughout the product lifecycle to compensate for the decline in product certainty, and gaining market trust through professional value.

Daily Economic News