Earnings Season | Net profit soars! The roles of banking and insurance channels are upgraded, with China Life's total assets and net assets both advancing simultaneously.

Source: Guanchao Finance

New Developments for China Life’s “Head Goose” in Life Insurance

Today, China Life released its 2025 annual financial report. Overall fundamentals look positive. The company’s total assets and net assets both reached new milestones, exceeding 7 trillion and 600 billion respectively; looking at receivables, it also became the first life insurer in China whose total premium surpassed the 700 billion yuan platform.

Particularly striking is that the net profit attributable to shareholders of the parent company saw a substantial year-on-year increase of 44.1% on top of the prior year’s breakthrough of the 100 billion yuan platform, reaching 154.078 billion yuan, underscoring its steady growth and strong momentum as an industry leader.

However, what is worth paying attention to is that, as the direct-sales (individual insurance) channel has gradually weakened since 2019 and bancassurance has risen, the dramatic channel shift has been amplified at this life insurance industry leader. In 2025, China Life’s bancassurance channel premium income first exceeded 100 billion yuan, playing a crucial role in the growth of various segment figures.

The headcount in the individual insurance channel is still declining. Fortunately, the rollout of the “report-and-pay alignment” policy has significantly reduced the cost of the bancassurance channel. But earlier this year, bancassurance channel commissions showed signs of picking up again, and the market—temporarily—was unsettled in pursuit of short-term performance. Good market order is maintained jointly by all insurers. Root-and-branch development is not sustainable, especially now that major leading insurers are increasingly relying on bancassurance channels.

01

Highlights | Net profit surges, bancassurance takes off

On March 25, China Life disclosed its 2025 annual finances. Its total and net assets steadily entered new platforms: total assets reached 7.59 trillion yuan, up 12.1%; net assets were 608.4 billion yuan, up 16.7%.

Meanwhile, China Life’s embedded value for 2025 was 1.47 trillion yuan, remaining the top in the industry; total premium reached 729.887 billion yuan, making it the first life insurance company in the industry to surpass the 700 billion yuan platform; new business value reached 45.752 billion yuan, up 35.7%; and net profit attributable to shareholders of the parent company was 154.078 billion yuan. Based on the 2024 breakthrough above 100 billion yuan, it grew again by 44.1%.

Li Mingguang: Suggest reducing overinterpretation of profits from a single quarter

From full-year performance, in 2025 China Life still maintained steady growth, with its profit growth rate especially standout. However, it is notable that the company posted losses exceeding 10 billion yuan in a single quarter. In the first three quarters of 2025, net profit attributable to shareholders of the parent company was 167.804 billion yuan; the calculation implies that its fourth-quarter loss was 13.726 billion yuan.

As a “stabilizing anchor” in the eyes of many investors, this loss has drawn significant attention. On March 26, China Life’s A-shares saw a big increase in sell volume and fell. The closing price was 37.74 yuan per share, down 4.43%.

In response, at today’s earnings conference, China Life’s president Li Mingguang said: “This reflects the difference between the full-year results and the first three-quarter results. The main reason is that there was a structural adjustment in the capital markets, and some of the company’s stocks and funds experienced pullbacks in the fourth quarter of 2025.

“Most of this volatility is phased, reflecting changes in the capital markets—this is a normal phenomenon.” Li Mingguang added: “Unlike other industries, life insurance companies have business characteristics spanning long cycles and multiple cycles. China Life’s investment is value-based and long-term. Asset-liability management and investment management should be observed over a longer period. It is recommended to reduce overinterpretation of profits in a single quarter.”

In the first three quarters of 2025, China Life achieved total investment income of 368.551 billion yuan, with a total investment yield of 6.42%. For the full year of 2025, the company’s total investment income was 387.694 billion yuan, and total investment yield was 6.09%. Compared with the first three quarters, the total investment yield fell by 0.33 percentage points.

Along with the annual performance release, China Life announced that it intends to distribute cash dividends for 2025 year-end to all shareholders of 17.468 billion yuan. Together with the interim dividend, the total would be 24.195 billion yuan, accounting for 16% of net profit attributable to shareholders of the parent company in the consolidated financial statements.

First Breakthrough Above 100 Billion, Bancassurance Channel Takes Off

In 2025, bancassurance channel total premium reached 110.87 billion yuan, up 45.5%, breaking through the 100 billion yuan threshold; first-time (new) single premiums reached 58.506 billion yuan, up 95.7%. The pace of scale expansion continued to accelerate. The number of new policy-issuing outlets reached 77,000, up 25.9%, including star-rated outlets increasing by 49.1% year over year. Bancassurance channel customer managers totaled 20,000; per-capita productivity increased by 53.7% year over year.

In China Life’s individual insurance channels, long-term first-year business was 90.879 billion yuan, down 9.73% year over year compared with 2024. Meanwhile, long-term first-year business in bancassurance surged 49.26% to 58.097 billion yuan. With this see-saw, the bancassurance channel’s share in long-term first-year business also rose significantly.

Regarding channel development, Li Mingguang said China Life fully leverages the advantages of operating across all channels. The individual insurance channel serves as the fundamental base, while multiple channels such as bancassurance and group insurance blossom in different areas.

In the individual insurance channel, it fully leverages the role of the main channel and steadily advances marketing system reforms. In 2025, incrementally added headcount increased 40% year over year; the 13-month retention rate improved by 2.2 percentage points year over year; and the proportion of personnel aged 45 and below increased by 2.3 percentage points year over year.

For the future development of the bancassurance channel, Li Mingguang said: “Next, the bancassurance channel will focus on key breakthroughs through deepening channel engagement and leaping upgrades in outlet capacity. Improving the strength of the team will serve as effective support, upgrading professional capabilities, deepening the cooperation ecosystem, and continuously enhancing the channel’s contribution.”

In the future, the “one-channel dominance” situation of China Life’s individual insurance channel will gradually disappear, and the bancassurance channel will play an increasingly important role in China Life’s business contribution.

02

Performance | Net assets break 600 billion, investment income nearly 200 billion

In 2025, China Life’s overall performance showed strong results. Assets grew steadily, investment income increased significantly, expense control was good, and lapse/withdrawal rates fell again.

From the asset position, in 2025 China Life’s total assets and net assets both increased steadily, though the growth rates were somewhat lower than in the same period of 2024. Specifically, the company’s total asset scale reached 75,910.04 billion yuan; the scale increased by 821.5 billion yuan compared with 2024, up 12.13%. Net assets rose to 6,083.93 billion yuan, increasing by 87.1 billion yuan compared with the same period last year, up 17%, continuing the growth trend.

(Before 2022, it is insurance business revenue; after 2022, it is insurance service revenue)

From the revenue side, in 2025 the company’s insurance service revenue was 214.136 billion yuan, up 6.0 billion yuan from 2024, up 2.87%, reversing the downward trend.

In terms of business structure, in 2025 China Life’s “insurance service revenue” mainly consisted of two major components: life insurance business and accident & health insurance. The former achieved 144.052 billion yuan, accounting for about 67%; the latter was 70.084 billion yuan, accounting for about 33%.

In 2025, China Life achieved net profit of 156.552 billion yuan, up about 47.6 billion yuan from the previous year, up 44%. After the industry accounting standards switch, the switch strongly benefited insurers’ profits. Starting in 2024, China Life’s profit level exceeded that of previous years by about one order of magnitude.

The profit composition matches the business direction. In 2025, the total profit of the life insurance business was 160.512 billion yuan, accounting for 88% of the company’s total profit—an absolute main force among the three segments. Accident & health insurance profit totaled 20.055 billion yuan, about 11%; other business profit declined, but it accounted for about 1%.

The primary factor affecting profit is investment income. Thanks to the strong capital market in the previous year, China Life’s investment segment performed well. After the downturn that saw investment income decline year after year starting in 2022, investment income in 2025 rebounded strongly to 198.457 billion yuan, the best data in the past three years. Compared with 2024, it increased by 128.1 billion yuan, up 182%.

Looking at the distribution of investment income last year, the main contributions came from the life insurance business and accident & health insurance. Among them, the life insurance business generated 186.640 billion yuan, accounting for more than 90% of total investment income; the latter generated 12.435 billion yuan, accounting for about 6%; other business was -0.618 billion yuan, which has little impact given the company’s overall scale.

On the cost side, after the implementation of the new accounting standards, the “fees and commissions” item has remained stable, decreasing slightly by 0.61% in 2025. “Business and management expenses” were 8.107 billion yuan, up 9.88% from 2024.

In terms of lapse/withdrawal rates, in 2025 China Life’s lapse/withdrawal rate was 0.95%. It fell below 1% for the second time within seven years, with a good situation.

03

Performance | Individual insurance headcount breaks 600,000; bancassurance income first exceeds 100 billion

In 2025, China Life’s annual total premium first surpassed the 700 billion yuan threshold, reaching 729.887 billion yuan, and the growth rate of new business value hit the highest level since 2017. Worth noting is that its bancassurance channel grew significantly. Whether in scale or contribution to new business value, its impact cannot be ignored.

By channel, in 2025 the share of premium income from the individual insurance channel edged down and stayed at the 500 billion yuan range for three consecutive years; the bancassurance channel pushed forward strongly, with premiums first breaking 100 billion yuan.

Specifically, premium income in the individual insurance channel was 551.79 billion yuan, up 4.3%. Although the growth rate slowed, it still remained the absolute main driver, accounting for about 75.6%. Bancassurance channel premium income was 110.874 billion yuan, up 45.5%, and the scale first exceeded 100 billion yuan.

(China Life 2025 annual performance report)

According to disclosures in its annual report, the sharp growth in bancassurance channel premium income mainly benefited from “report-and-pay alignment,” which helped control costs and improve efficiency in channels; expanding and upgrading outlet operations; and strong growth in floating-income-type products. It is worth mentioning that China Life’s other channel total premiums mainly include premiums from policy-based health insurance, online sales business premiums, etc. Among them, the scale of its policy-based health insurance business reached a historical high in 2025, which to some extent supported premium growth in other channels.

Thanks to the bancassurance channel’s strong turnaround, in 2025 China Life’s new single premiums and renewal premiums both remained in growth. In 2025, the insurer achieved new single premiums of 234.079 billion yuan, up 9.29%; and renewal premiums of 495.808 billion yuan, up 8.42%. Renewal premiums remain the main component of total premiums, accounting for about 67.92%.

In terms of payment methods, lump-sum payment premiums (single premium) hit a new high within seven years, which is also a feature of bancassurance channels. In first-year business, the lump-sum payment scale rose to 36.298 billion yuan, up 176.47% year over year compared with the previous year. In terms of share, among long-term first-year business in each channel, the total lump-sum amount as a proportion of total premium was 4.97%, up 3.01 percentage points from 1.96% in 2024.

As can be seen in the chart above, lump-sum payment premiums mainly come from the bancassurance channel, accounting for as much as 87.11%. Bancassurance channel lump-sum payment premiums jumped from 10.7 billion yuan in 2024 to 31.619 billion yuan in 2025, up 195.5%.

The main reasons for the above phenomenon are industry-level challenges in the individual insurance channel, which can be concluded from the analysis related to the individual insurance channel shown in the figure below.

In 2025, China Life’s total sales headcount continued to decline, marking the sixth consecutive year of decline since 2019. The end-of-2025 figure was 638,000, down 28,000 from 666,000 at the end of 2024, a year-on-year decrease of 4.2%.

As for individual insurance sales headcount, its change trend from 2019 to 2025 is consistent with that of total sales headcount. Individual insurance sales headcount at the end of 2025 was 587,000, also down 28,000 from 615,000 at the end of 2024, a year-on-year decrease of 4.55%. Among them, the size of the marketing team was 371,000, and the size of the solicitation/recruitment team was 216,000.

(China Life 2025 annual performance report)

According to its annual report disclosures, while consolidating team management and maintaining the existing lineup, the company continuously optimizes the team structure through incremental recruitment and improved cultivation. It no longer pursues team size alone; instead it transitions toward “professionalization, specialization, and younger demographics.” Team quality continues to improve, with incremental headcount up 40% year over year, and new talent continues to grow stronger.

With the sustained decline of headcount in the individual insurance segment, growth in premium income faces challenges. However, in 2025, China Life’s individual insurance channel new business value still grew year over year, though at a slower pace than overall new business value—the share of new business value from the individual insurance segment fell, while the bancassurance channel is what lifted the company’s overall new business value growth rate.

Benefiting from the bancassurance channel’s contribution, China Life’s new business value and embedded value continued to grow. In 2025, its embedded value continued to maintain an upward trend, reaching 1467.876 billion yuan, up 4.76% year over year, an increase of 66.73 billion yuan compared with the same period last year.

The movement of the “head goose” in life insurance is closely watched by the market. Disturbances in the capital market are short-term, while channel building is long-term. Whether China Life’s channel changes represent a broader industry trend still requires continued attention.

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