China Life: Net profit exceeds 150 billion yuan, earning over 420 million yuan daily

Ask AI · China Life’s net profit soars, what are its unique investment strategies?

Text / Dong Xuan

Source / Node Finance

2025’s insurance industry faces both opportunities and challenges.

On one hand, emerging from the cyclical trough, the industry is experiencing a comprehensive recovery.

According to data disclosed by the China Banking and Insurance Regulatory Commission, in 2025, the total premium income of the entire industry reached 6.12 trillion yuan, a year-on-year increase of 7.43%. Among them, life insurance business continued to maintain double-digit growth, with segments like health insurance and new energy vehicle insurance also leading the field.

On the other hand, the “reporting and operation integration” policy promotes the industry from extensive expansion to refined and compliant management, which in the short term causes adjustments in channel income and fluctuations in premium growth, testing the survival resilience of companies, especially small and medium players.

Against this backdrop, industry leader China Life, with a hefty financial report, exemplifies what it means to be “the big always stays big, the steady always remains strong.”

Trillion Giant, Both Stable and Profitable

Attention, key point: China Life’s performance is truly substantial:

Total premiums first surpassed 700 billion yuan, reaching 61.2k yuan, an 8.7% increase; calculated over 365 days, this is roughly 729.89B yuan in premiums per day. Globally, such scale ranks among the top in the life insurance industry.

Total assets rose to 7.59 trillion yuan, with investment assets of 7.42 trillion yuan, crossing three trillion-yuan thresholds consecutively during the “14th Five-Year Plan” period.

Several core indicators, including first-year premium for new policies, new business value growth, total investment return rate, and net profit attributable to the parent company, set new records.

Behind this scale is an optimized business structure. In 2025, China Life’s first-year premiums for new policies reached 2B yuan, maintaining the industry’s top position; ten-year and above first-year premiums totaled 75.9k yuan, accounting for 44.92% of the total first-year premiums.

Among these, the proportion of ten-year and above first-year premiums from individual insurance channels further increased to 58.48%, with ten-year and above first-year premiums from long-term insurance reaching 74.2k yuan, representing 44.92%.

These figures roughly outline China Life’s “solid foundation”: not built on short-term surges, but on long-term deep cultivation; not relying on a single channel, but on diversified and balanced sources.

Profitability performance is even more impressive. In 2025, China Life’s net profit attributable to the parent reached 116.21B yuan, a 44.1% increase from 52.2B yuan the previous year. This indicates that, even on a high base in 2024, the company maintained strong growth, earning over 420 million yuan daily.

Image source: China Life Financial Report

Analysis by Node Finance suggests that the core driver of this profit surge is the investment side. In 2025, China Life achieved a total investment income of 52.2B yuan, an increase of 154.08B yuan or 25.8% year-on-year; the total investment yield reached 6.09%, up 59 basis points from the same period last year, setting a recent record for investment results.

In the context of low bond market interest rates and structural differentiation in the stock market, this figure is highly valuable.

It’s worth noting that, according to CICC estimates, China Life’s net investment yield in 2025 may be around 3.04%, about 45 basis points lower than 2024, mainly due to the gradual maturity of high-quality existing fixed-income assets and the downward trend in new asset yields. However, the significant increase in total investment income successfully offset the downward pressure on net investment income.

Looking at the key indicator of growth potential for life insurance companies—new business value—China Life also performs excellently.

In 2025, China Life’s one-year new business value reached 106.93B yuan, a 35.7% increase, the highest growth rate since 2017. Among them, contributions from individual insurance channels and bancassurance and other channels were 39.3 billion yuan and 6.45 billion yuan, with growth rates of 25.5% and 169.3%, respectively.

Image source: China Life Financial Report

It’s clear that, despite the industry impact of the “reporting and operation integration” policy, China Life was unaffected; the bancassurance channel even grew into a new “growth engine.”

In terms of profitability, in 2025, the company’s NBV Margin (New Business Value Rate) rose sharply to 23.8%, a significant improvement from 17.3% in 2024.

With such a large foundation, the company can also rapidly climb higher, ensuring ample solvency levels. By the end of 2025, China Life’s comprehensive solvency adequacy ratio reached 174.01%, and the core solvency adequacy ratio was 128.77%.

The giant turns, but challenges remain

Although overall performance is commendable, closer inspection reveals some shortcomings.

First, the market’s hot topic: the company’s Q4 performance. In the first three quarters of 2025, China Life’s net profit attributable to the parent was 387.69B yuan, meaning Q4 alone recorded about 13.7 billion yuan in losses.

China Life’s President Li Mingguang responded at the earnings conference that the main reason was structural adjustments in the capital markets during that period, causing some stocks and funds held to decline. He emphasized that such fluctuations are mostly temporary, reflecting short-term market changes and not indicative of long-term business trends.

Huatai Securities analysis suggests this may be related to investment volatility in Q4 and increased asset impairments. Zhongtai Securities’ estimates also confirm that in Q4 2025, the company’s investment interest spread was -79.44B yuan, mainly due to intensified stock and bond market turbulence, with fair value changes significantly narrowing.

This volatility exposes a structural issue: as the company’s equity asset allocation ratio continues to rise (from 12.18% to 16.89%), its profit structure has become more sensitive to capital market fluctuations, reaching a historic high. In a bullish market, this allocation can generate remarkable returns; but during a market correction, profit retracement can be even more severe.

Second, growth pressure on traditional guaranteed business.

Node Finance notes that, alongside product structure transformation, China Life’s traditional business faces growth challenges. In 2025, ten-year and above first-year premiums totaled 45.75B yuan, down 7.78% year-on-year.

Image source: China Life Financial Report

This indicates that, although participating (dividend-paying) insurance accounts for nearly 50% of first-year premiums, the contraction of traditional guaranteed business is creating a hedge.

With interest rates continuing to decline, shifting toward dividend insurance is the trend. But this transition also tests the company’s ability to realize investment returns. When nearly 60% of new policies are driven by dividend demonstrations, fluctuations in dividend realization rates directly impact customer satisfaction and may even trigger surrenders.

Industry experience shows that during 2024’s stock and bond market turbulence, some insurers experienced frequent surrenders of dividend products, with one leading insurer’s surrender rate reaching as high as 20%.

Third, the downward trend of net investment yield cannot be ignored.

In a low-interest-rate environment that’s difficult to reverse in the short term, the yield center of fixed-income assets will remain under pressure. Although the company has increased equity allocations to hedge some of this, the high volatility of equity assets introduces new uncertainties. Balancing returns and risks remains a continuous challenge for the investment side.

Fourth, the growth of embedded value has slowed.

Image source: China Life Financial Report

Compared to previous years, the growth rate has slowed. Zhongtai Securities analysis points out that, although positive contribution from investment return deviations exists, fair value losses in the bond market drag on the overall embedded value.

On the liability side, the company still holds 327 million effective long-term policies, containing a large volume of traditional guaranteed products sold during high-interest periods. Even though the asset-liability duration gap of new policies has shortened to about 1.5 years, the overall rigid cost structure still requires a long cycle to fully amortize.

All these concerns have, in fact, amplified market negative sentiment. On March 26, the day after the financial report was released, China Life’s A-share stock plummeted 4.43%, and H-shares fell over 8%, with intraday declines approaching 9.5%.

Looking back from 2026, the challenges reflected in China Life’s annual report echo what company management said at the earnings conference: life insurance asset-liability management has long and cross-cycle characteristics. While short-term financial indicators are bright, the real test lies in whether the company can continue to optimize liability costs in a low-interest environment, stabilize investment returns amid equity market volatility, and achieve substantive improvements in team quality during channel transformation.

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