Reporter: Yang Xiaohan
Recently, the National Financial Regulatory Administration released data on the operational performance of life insurance companies for the first 8 months of this year. The data shows that during the first 8 months, life insurance companies received new policyholder investment payments (representing universal life insurance premiums) totaling 4973 billion yuan, a year-over-year increase of 8.4%, maintaining a high growth rate.
Experts say the steady growth in universal life insurance premiums is driven by rising demand for capital safety, increased savings activity, and the product's unique features.
Universal life insurance refers to a type of personal insurance product that includes both coverage and the flexibility to add premiums or adjust the sum insured, maintains a separate policy account, guarantees a minimum return, and has "universal" in its product name.
In recent years, universal life insurance premiums have risen due to industry transformation and growth in savings-type insurance sales. Data released by the National Financial Regulatory Administration shows that universal life insurance maintained strong growth even as overall premium income for personal insurance companies slowed down.
Specifically, data shows that in the first 8 months of this year, life insurance companies recorded gross premium income (hereinafter referred to as "premium income") of 35719 billion yuan, a year-over-year decrease of 0.2%. Life insurance premiums totaled 29757 billion yuan, up 0.04% year over year. Premiums for accident and health insurance, among other categories, declined year over year.
Zhou Jin, a consulting partner at Tianzhi International's Financial Services sector, told Securities Daily that amid expectations of a downward trend in interest rate benchmarks and heightened volatility in equity markets, the growth in universal life insurance premiums is primarily driven by increased capital demand for safety amid an "asset shortage," combined with spillover from consumers' savings needs. As large volumes of maturing time deposits require reinvestment, insurance products—offering both guaranteed and floating returns—have become attractive to consumers. Some insurers have designed universal accounts as "savings pools" for annuity and increasing whole-life insurance policies, allowing policyholders to participate in excess investment returns through additional contributions and survival benefit transfers, thereby diverting significant funds from maturing savings.
Universal life insurance products feature a "guaranteed + floating" return structure. Their interest rates consist of two components: the minimum guaranteed rate and the settlement rate. The minimum guaranteed rate is the lowest return the insurer promises policyholders, unaffected by market conditions or the company's investment performance. The settlement rate represents the actual interest rate used to allocate returns to policyholders; any excess floating returns depend on market performance and the insurer's investment operations.
Chen Fu, Chief Non-Banking Analyst at Guangfa Securities, believes that the growth in universal life insurance premiums over the first 8 months reached 8.4% year-over-year, maintaining a high-growth trend. The strong demand for savings-oriented insurance is expected to further drive rising interest in universal life products.
Looking ahead, Long Ge, Deputy Director of the Innovation and Risk Management Research Center at the University of International Business and Economics, told Securities Daily that universal life insurance will shift from competing on returns to competing on functionality, with greater emphasis on long-term protection, cash flow planning, and account transparency. Universal life policies will return to their core role as "long-term compounding vehicles" attached to annuity or whole life insurance products. In terms of market competition, the focus will move beyond rate wars to a comprehensive contest of service quality and asset allocation capabilities.
Zhou Jin believes that universal life insurance may exhibit four future trends: first, the central settlement interest rate will continue to converge toward the guaranteed minimum rate and remain stable at a low level with narrow fluctuations.
Second, guaranteed interest rates are entering a dynamic adjustment phase. Rates can be adjusted after the guarantee period expires, and the central rate will continue to decline, serving as a pressure relief valve for insurers to hedge against spread losses.
Third, the "base policy + universal account" model has become mainstream, integrated into retirement and education funding scenarios with a strong defensive focus.
Fourth, product differentiation has become normalized. The ability to match investments with liabilities is now a key competitive advantage for insurers and their products.
