Hong Kong Exchanges and Clearing Limited and The Stock Exchange of Hong Kong Limited take no responsibility for the contents of this announcement, make no representation as to its accuracy or completeness and expressly disclaim any liability whatsoever for any loss howsoever arising from or in reliance upon the whole or any part of the contents of this announcement.
OVERSEAS REGULATORY ANNOUNCEMENT
This announcement is made by New China Life Insurance Company Ltd. (the "Company") pursuant to Rule 13.10B of the Rules Governing the Listing of Securities on The Stock Exchange of Hong Kong Limited. The announcement is hereby set out as follows for reference only.
By Order of the Board
New China Life Insurance Company Ltd.
LIU Haoling
Chairman
Beijing, China, 25 August 2020
As at the date of this announcement, the chairman and non-executive director of the Company is LIU Haoling, the executive director is LI Quan; the non-executive directors are YANG Yi, GUO Ruixiang, HU Aimin, LI Qiqiang, PENG Yulong and Edouard SCHMID; and the independent non-executive directors are LI Xianglu, ZHENG Wei, CHENG Lie, GENG Jianxin and MA Yiu Tim.
2020 Interim Results Announcement
26 Aug. 2020
Beijing, China
Disclaimer
- These materials are for information purposes only and do not constitute or form part of an offer or invitation to sell or issue or the solicitation of an offer or invitation to buy or subscribe for securities of New China Life Insurance Company Ltd. (the "Company") or any of its holding company or affiliates in any jurisdiction. No part of these materials shall form the basis of or be relied upon in connection with any contract or commitment whatsoever.
- The information or opinions contained in these materials has not been independently verified. No representation or warranty, whether expressed or implied, is made as to, and no reliance should be placed on, the fairness, accuracy, completeness or correctness of such information or opinions contained herein. The information and opinions contained in these materials are provided as of the date of the presentation, are subject to change without notice and will not be updated or otherwise revised to reflect any developments, which may occur after the date of the presentation. The Company, any of its affiliates, directors, supervisors, senior managers, officers, employees, advisers and any of their respective representatives shall not have any liability whatsoever (in negligence or otherwise) for any loss howsoever arising from or in reliance upon any information contained or presented in or derived from these materials or otherwise arising in connection with these materials.
- These materials contain statements that reflect the Company's current beliefs and expectations about the future as of the respective dates indicated herein. These forward-looking statements are based on a number of assumptions about the Company's operations and businesses and on factors beyond the Company's control, and are subject to significant risks and uncertainties, and, accordingly, the actual results may differ materially from these forward-looking statements. You should not place undue reliance on any of such forward-looking information. The Company assumes no obligation whatsoever to update or otherwise revise these forward-looking statements for new information, events or circumstances that emerge subsequent to such dates.
1
OVERVIEW
OVERVIEW INSURANCE FINANCIALS & EMBEDDED
BUSINESS INVESTMENT VALUE
This document is for specific use only; the "Disclaimer" is an integral part of this document. 2
Overview
"1+2+1"STRATEGY
OLD-AGE CARE | |
& | |
TECHNOLOGY EMPOWERMENT | HEALTHCARE |
LIFE | |
INSURANCE | |
WEALTH | |
MANAGEMENT |
Deepened synergy
Asset liability dual engines driving
volume and value growth
Absolute return responding to market fluctuations
Our vision: to be China's best financial service group with comprehensive life insurance business as its core
This document is for specific use only; the "Disclaimer" is an integral part of this document. 3
Overview
COVID-19 impacted the life insurance industry in the first half of 2020. The Company made concerted efforts and took various measures to boost business growth.
Gross written premiums achieved rapid growth
Embedded value constantly increased
Business structure realized balanced development
Business quality remained stable
This document is for specific use only; the "Disclaimer" is an integral part of this document. 4
Results Highlights for 1H2020
Unit: RMB in millions
Gross written premiums | FYP from long-term | Total assets | ||||||
insurance business | ||||||||
96,879 | +30.9% | 29,862 | +155.0% | 939,351 | +6.9% | |||
Embedded value | 13-month | Surrender rate | |||
persistency ratio | |||||
224,757 +9.6% | 91.0% +0.9pt | 0.7% -0.3pt | |||
Volume Growth
Stable Quality
This document is for specific use only; the "Disclaimer" is an integral part of this document. 5
Future Prospects
The Company will push forward the development strategy
of "one body, two
wings, and technology
empowerment" to
promote high-quality
development.
Accelerate product
innovation &
Promote industrial
synergy
Strengthen
application of innovation & Promote technology empowerment
Control
investment risks
-
Seize
investment
opportunities
Enhance compliance
management & Consolidate risk prevention and control
This document is for specific use only; the "Disclaimer" is an integral part of this document. 6
Social Responsibility
Sanitation workers
project
- 102 cities
- Over 750,000 sanitation workers
- Sum assured over RMB186.6 billion
Fighting COVID-19
- Insurance donation to 200,000 medicals in Wuhan
- Sum assured RMB60 billion
- Donation worth RMB7.6 million
Targeted poverty
alleviation
- 11 provinces
- Over 50,000 poor people
- Sum assured over RMB5 billion
Note: Data used are as at Jul. 31, 2020.
This document is for specific use only; the "Disclaimer" is an integral part of this document. 7
INSURANCE
BUSINESS
OVERVIEW INSURANCE | FINANCIALS & | EMBEDDED |
BUSINESS | INVESTMENT | VALUE |
This document is for specific use only; the "Disclaimer" is an integral part of this document. 8
Gross Written Premiums & Breakdown
Unit: RMB in millions
30.9%
96,879
73,994 | 29,862 |
155.0% | |
11,712 | 11.3% |
4,322 | |
3,883 |
7.4%
58,39962,695
1H20191H2020
15.8%
5.2%
78.9%
1H2019
30.8%
4.5%64.7%
1H2020
FYP from long-term | Premiums from short- | Renewal premiums | ||
insurance business | term insurance business |
Note: Numbers may not be additive due to rounding.
This document is for specific use only; the "Disclaimer" is an integral part of this document. 9
Product Structure
FYP from long-terminsurance business
4,736.3% -15.2% 63.6%
16,395
6,522 | 7,936 | ||
5,531 | 4,851 | ||
339 | |||
Participating | Health | Traditional | |
insurance | insurance | insurance | |
1H2019 | 1H2020 |
Unit: RMB in millions
Gross Written Premiums
55.9% 14.4% 23.5%
40,054 | |
32,021 | |
25,684 | 27,980 |
23,581 | |
19,089 |
Participating Health Traditional
insurance insurance insurance
This document is for specific use only; the "Disclaimer" is an integral part of this document. 10
GWP Breakdown by Channels
10.5%
66,258
59,986
133.8%
29,143 | |
-4.1% | |
12,467 | |
1,541 1,478 | |
Individual insurance | Bancassurance Group insurance |
1H2019 | 1H2020 |
Unit: RMB in millions
2.1%
16.8%
81.1%
1H2019
1.5%
30.1%
68.4%
1H2020 | ||
Individual | Bancassurance | Group |
insurance | insurance |
This document is for specific use only; the "Disclaimer" is an integral part of this document. 11
Individual Insurance - Premiums
Unit: RMB in millions | |||||
FYP from long-term | FYRP from long-term | Renewal premiums | Premiums from short- | ||
insurance business | insurance business | term insurance business | |||
14.0% | 8.3% | 9.2% | |||
53,099 | 22.0% | ||||
10,329 | 48,609 | ||||
9,058 | 9,800 | ||||
9,047 | |||||
2,319 2,830
1H20191H2020
This document is for specific use only; the "Disclaimer" is an integral part of this document. 12
Individual Insurance - Sales Force
Total agents | 526,000 | 36.5% |
Monthly average | 135,000 | -3.5% |
qualified agents |
Monthly average | 26.4% | -12.4pts |
qualified rate |
Notes:
- Monthly average number of qualified agents = (Σnumber of qualified agents in a month)/the number of months in the reporting period, where monthly number of qualified agents refers to the number of agents who have issued one insurance policy or more (including card-typeshort-term accident insurance policy) which are not cancelled by policy holders in a month and whose first year commission in the month is equal to or greater than RMB800.
- Monthly average qualified rate = monthly average number of qualified agents/monthly average number of agents*100%. Monthly average number of agents={Σ [(number of agents at start of the month + number of agents at end of the month)/2]}/the number of months in the reporting period.
Strengthen sales team and agent headcounts hit a record high
Greater challenges to
marketing
and active agent
headcounts reduced
This document is for specific use only; the "Disclaimer" is an integral part of this document. 13
Bancassurance - Premiums
Unit: RMB in millions
FYP from long-term | FYRP from long-term |
insurance business | insurance business |
635.3% | 38.0% |
19,507
3,659
2,651
2,653
1H2019
Renewal premiums | Premiums from short- |
term insurance business | |
-2.0% |
9,786 9,592
57.1%
28 44
1H2020
This document is for specific use only; the "Disclaimer" is an integral part of this document. 14
Business Quality
Persistency ratio of individual
life insurance business
91.0%
90.1%
13-month
86.5%
25-month
84.6%
1H20191H2020
Surrender rate
-0.3pt
1.0%
0.7%
1H2019 1H2020
This document is for specific use only; the "Disclaimer" is an integral part of this document. 15
FINANCIALS &
INVESTMENT
OVERVIEW INSURANCE | FINANCIALS & | EMBEDDED |
BUSINESS | INVESTMENT | VALUE |
This document is for specific use only; the "Disclaimer" is an integral part of this document. 16
Key Financial Indicators
Unit: RMB in millions
Revenues
ExpensesProfit
1H2020 1H2019 Change
Total
Revenues 116,076 89,092 30.3%
Net written | ||
premiums and | 95,425 | 72,767 31.1% |
policy fees |
Investment | 20,751 | 16,684 24.4% |
income |
1H2020 1H2019 Change
Insurance | |||
benefits | 89,793 | 63,425 | 41.6% |
and claims |
Commission | |||
and brokerage | 9,617 | 8,943 | 7.5% |
expenses |
Administrative | 5,320 | 5,512 | -3.5% |
expenses |
Net profit attributable to shareholders of the
Company-22.1%
8,218
10,545
Earnings per share | -22.2% |
(RMB yuan) | |
2.63 |
3.38
Weighted average ROE
attributable to shareholders -5.46pts of the Company(%)
9.13%
14.59%
1H2020 | 1H2019 |
Note: Above figures are IFRS based.
This document is for specific use only; the "Disclaimer" is an integral part of this document. 17
Investment Performance
Investment assets | Annualized total |
investment yield | |
7.3% | 0.4 pt |
900,317 | 5.1% |
839,447 | 4.7% |
31 Dec. 2019 | 30 Jun. 2020 | 1H2019 | 1H2020 |
Unit: RMB in millions
Annualized net investment yield
-0.4 pt
5.0%
4.6%
1H20191H2020
This document is for specific use only; the "Disclaimer" is an integral part of this document. 18
Investment Portfolio
Categories | As at 30 Jun. 2020 | As at Dec. 31 2019 | Change |
(Proportion) | (Proportion) | (pt) | |
Term deposits | 10.6% | 7.6% | 3.0 |
Debt financial assets | 61.6% | 65.6% | -4.0 |
-Bonds | 42.7% | 42.7% | - |
-Trust products | 10.5% | 9.2% | 1.3 |
-Debt plans | 4.3% | 4.6% | -0.3 |
-Asset funding plans | - | 1.2% | -1.2 |
-Others | 4.1% | 7.9% | -3.8 |
Equity financial assets | 20.5% | 18.7% | 1.8 |
-Funds | 5.2% | 5.5% | -0.3 |
-Stocks | 7.4% | 6.6% | 0.8 |
-Others | 7.9% | 6.6% | 1.3 |
Investments in | 0.5% | 0.6% | |
associates and joint | -0.1 | ||
ventures | |||
Cash and cash | 1.3% | 1.4% | -0.1 |
equivalents | |||
Other investment | 5.5% | 6.1% | -0.6 |
assets | |||
1.3% 5.5%
0.5%
10.6%
20.5%
61.6%
Term deposits
Debt financial assets
Equity financial assets
Investments in associates and joint ventures
Cash and cash equivalents Other investment assets
This document is for specific use only; the "Disclaimer" is an integral part of this document. 19
Non-standard Investment Portfolio
Categories
Non-standard debt investments
-Trust product
-Debt plan
-Project asset support plan
-Wealth management product -Perpetual bond
-Asset management plan
Non-standard equity investments
-Asset management plan -Private equity
-Unlisted equity
-Equity investment plan
- Wealth management product
-Derivative financial asset
Total
As at 30 Jun. | Proportion | Proportion |
2020 | Change (pt) | |
170,159 | 71.1% | -7.0 |
8.2 | ||
94,501 | 39.5% | |
39,065 | 16.3% | 0.5 |
-4.1 | ||
- | - | |
31,548 | 13.2% | -11.7 |
5,000 | 2.1% | 0.1 |
45 | - | - |
69,122 | 28.9% | 7.0 |
39,044 | 16.3% | 7.3 |
8,806 | 3.7% | 0.8 |
16,570 | 6.9% | -0.6 |
4,700 | 2.0% | 0.1 |
2 | - | - |
- | - | -0.6 |
239,281 | 100.0% | - |
Unit: RMB in millions
28.9%
71.1%
Non-standard debt investments
Non-standard equity investments
This document is for specific use only; the "Disclaimer" is an integral part of this document. 20
Solvency
Core solvency margin
ratio
-11.85 pts
283.64%
271.79%
31 Dec. 2019
Unit: RMB in millions
Comprehensive solvency | Capital | ||||
margin ratio | |||||
-1.86 pts | 30/6/2020 31/12/2019 Change | ||||
283.64% | 281.78% | ||||
Core | 272,078 | 261,164 | 10,914 | ||
capital | |||||
Actual | 282,078 | 261,164 | 20,914 |
capital | |||
Minimum | 100,107 | 92,077 | 8,030 | ||
capital | |||||
30 Jun. 2020 | |||||
This document is for specific use only; the "Disclaimer" is an integral part of this document. 21
EMBEDDED VALUE
OVERVIEW INSURANCE | FINANCIALS & | EMBEDDED |
BUSINESS | INVESTMENT | VALUE |
This document is for specific use only; the "Disclaimer" is an integral part of this document. 22
Embedded Value - Composition Analysis
Unit: RMB in millions
9.6% 224,757
205,043
Value of In-force Business
82,119
11.9% 91,917
8.1%
Adjusted Net
Worth
Note:
- The risk discount rate used was 11.0% as at 30 June 2020. The risk discount rate used was 11.5% as at 31 December 2019.
- Numbers may not be additive due to rounding.
122,924132,841
31 Dec. 2019 | 30 Jun. 2020 |
This document is for specific use only; the "Disclaimer" is an integral part of this document. 23
Embedded Value-Movement Analysis
Unit: RMB in millions
Movement analysis from Dec. 31, 2019 to Jun. 30, 2020
5,221 | 8,832 | 3,107 | 2,588 | 3,954 | 311 | 100 | 224,757 | |||||
205,043 | - | - | ||||||||||
(4,399) | ||||||||||||
EV at the | Impact of | Expected | Operating | Economic | Operating | Economic | Change of | Capital | Others | Value Change | EV at |
beginning | Value of | Return | Experience | Experience | Assumption | Assumption | Risk | Injection/ | Other Than | the end | |
of period | New Business | Variances | Variances | Changes | Changes | Discount | Shareholder | Life Insurance | of period | ||
Rate | Dividend | Business | |||||||||
Note: Numbers may not be additive due to rounding. | Payment | ||||||||||
This document is for specific use only; the "Disclaimer" is an integral part of this document. 24
Value of New Business
Unit: RMB in millions
-11.4% | 38.0% |
5,890
5,22137.9%
1H2019 | 1H2020 | 1H2019 |
Notes:
1. The risk discount rate used was 11.0% in 1H2020. The risk discount rate used was 11.5% in 1H2019.
VNB Margin
27.0% (FYP)
VNB Margin (APE)
15.3%
1H2020
- FYP= 100% * first year regular premiums+100% * first year single premiums +100% * premiums from short-term insurance business
- APE= 100% * first year regular premiums+10% * first year single premiums +100% * premiums from short-term insurance business
- Numbers may not be additive due to rounding.
This document is for specific use only; the "Disclaimer" is an integral part of this document. 25
CARE FOR EACH AND EVERY DAY
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New China Life Insurance Co. Ltd. published this content on 25 August 2020 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 25 August 2020 09:57:36 UTC