HONG KONG, March 25, 2020 /PRNewswire/ -- China Life
Insurance Company Limited (SSE: 601628, SEHK: 2628, NYSE: LFC)
announces the audited consolidated results of the Company (China
Life Insurance Company Limited and its subsidiaries) for the year
ended 31 December 2019 (the
"Reporting Period") prepared under the International Financial
Reporting Standards today.
Highlights
- As at the end of
the Reporting Period, the Company's total assets reached
RMB3,726,734 million, an increase of 14.5% from the end of 2018.
The Company's embedded value was RMB942,087 million, an increase of
18.5% from the end of 2018.
- During the
Reporting Period, the Company's total revenue was RMB729,474
million, an increase of 16.3% year on year; the Company's gross
written premiums were RMB567,086 million, an increase of 5.8% year
on year, maintaining the leading position in the industry; value of
one year's sales was RMB58,698 million, an increase of 18.6% year
on year.
- As at the end of
the Reporting Period, the Company's investment assets reached
RMB3,573,154 million, an increase of 15.1% from the end of 2018.
During the Reporting Period, the gross investment yield was 5.24%,
the net investment yield was 4.61%. The comprehensive investment
yield taking into account the current net fair value changes of
available-for-sale securities recognised in other comprehensive
income was 7.28%.
- During the
Reporting Period, net profit attributable to equity holders of the
Company was RMB58,287 million, an increase of 411.5% year on
year.
- The board of
directors of the Company recommended the payment of a final
dividend of RMB0.73 per share (inclusive of tax). The foregoing
profit distribution plan is subject to the approval by the 2019
Annual General Meeting to be held on 29 June 2020
(Monday).
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Business Overview of
2019
In 2019, despite the complicated situation of increased risks
and challenges at home and abroad, the Company concentrated on the
strategic goal of "China Life Revitalization" with "Dual Centers
and Dual Focuses" as its strategic core, adhered to the overall
keynote of making steady progress, and upheld the operational
guideline of "prioritizing business value, strengthening sales
force, achieving stable growth, upgrading technology, optimizing
services, and guarding against risks". The Company accelerated the
establishment of a development system of "Yi Ti Duo Yuan" with
strengthened individual agent channel in coordination with other
channels as well as a market-oriented investment management system,
strengthened technological empowerment, focused on the
transformation of sales and the development of protection-oriented
business, reformed its sales models, investment and services
systems, constantly improved the efficiency of risk prevention and
control, and achieved the coordinated growth of business scale and
value.
During the Reporting Period, the Company's gross written
premiums amounted to RMB567,086
million, an increase of 5.8% year on year, maintaining its
industry leadership position. As at 31
December 2019, embedded value of the Company reached
RMB942,087 million, an increase of
18.5% from the end of 2018. Value of one year's sales was
RMB58,698 million, an increase of
18.6% year on year. During the Reporting Period, the Company
continued to enhance the asset-liability management, and its gross
investment income reached RMB169,043
million, a significant increase of 77.7% from 2018. Due to
an increase in gross investment income and the impact from the new
policy on pre-tax deduction of underwriting and policy acquisition
costs, net profit attributable to equity holders of the Company was
RMB58,287 million, an increase of
411.5% year on year. As at the end of the Reporting Period, the
core solvency ratio and the comprehensive solvency ratio were
266.71% and 276.53%, respectively.
During the Reporting Period, with a commitment to
high-quality development, the Company achieved a rapid growth in
its business value. Value of one year's sales of the Company
was RMB58,698 million, an increase of
18.6% year on year. The new business margin of one year's sales of
the exclusive individual agent channel and the bancassurance
channel increased by 3.2 and 5.1 percentage points year on year,
respectively. As at 31 December 2019,
embedded value of the Company reached RMB942,087 million, increasing by 18.5% from the
end of 2018. The surrender rate was 1.89%, a decrease of 2.80
percentage points year on year.
During the Reporting Period, the Company vigorously developed
its long-term regular business and its business structure was
further optimized. First-year regular premiums amounted to
RMB109,416 million, which accounted
for 97.89% of long-term first-year premiums, increasing by 7.73
percentage points year on year. In particular, first-year regular
premiums with a payment duration of ten years or longer were
RMB59,168 million (a year-on-year
increase of 42.1%), which accounted for 54.08% of the first-year
regular premiums (a year-on-year increase of 14.21 percentage
points). Renewal premiums amounted to RMB385,797 million (a year-on-year increase of
5.8%), which accounted for 68.03% of the gross written
premiums.
During the Reporting Period, the Company emphasized its due
role of insurance protection, and made great efforts to develop
protection-oriented business. The Company accelerated the
development of protection-oriented businesses and further
diversified its product mix. Out of the top ten insurance products
by first-year regular premiums, six were protection-oriented
products. The percentage of premiums from designated
protection-oriented insurance business in the first-year regular
premiums rose by 8.6 percentage points year on year, with an
increase in both the number of protection-oriented insurance
policies and average premiums per policy.
During the Reporting Period, the Company achieved significant
increase in investment income by constantly enhancing the
asset-liability management and optimizing its asset allocation
strategies. The Company recorded a gross investment income of
RMB169,043 million, a year-on- year
increase of 77.7% from 2018.
In 2019, the Company kicked off the "Dingxin Project" under the
guidance of "China Life Revitalization" strategy with "Dual Centers
and Dual Focuses" as its strategic core. As at the end of the
Reporting Period, the Company completed the optimization of its
organizational structure and personnel adjustments and actively
explored and established an organizational model and mechanism in
line with the Company's strategy. In terms of sales
function, a development system of "Yi Ti Duo Yuan" was
initially formed, which featured a strengthened individual agent
channel at the core of value creation. The Company integrated all
sales resources for individual insurance business and consolidated
the bancassurance channel's insurance planners, tele-sales and
agent channel's upsales teams. By separately managing and operating
the general agent team and the new upsales team, which were both
supported by the four functions of individual insurance planning,
individual insurance operation, training and integrated finance
functions, the Company deepened the transformation and upgrade of
individual insurance business. In the development of the
diversification ("Duo Yuan") system, the Company reinforced and
improved the existing advantages of the other channels. The group
insurance channel focused on the development of its professional
operation capacity. The bancassurance channel would generate
business through bank outlets, properly coordinate growth in
business scale and value, and optimize its business structure. The
health insurance channel focused on professional development. In
terms of the investment function, the Company further improved
its top-down investment management system in line with the
investment value creation chain, including strategic asset
allocation, tactical asset allocation, investment management,
strengthened risk management in all aspects and investment
operation support. In terms of operations, the Company
accelerated the integration of front, middle, and back offices,
gradually established an integrated intelligent operational system
and a precise financial resource allocation system, and started to
set up an operation and financial sharing service center. Based on
the completion of its organizational restructuring in 2019, the
Company will continue to push forward the "Dingxin Project"
reforms, further improve its operational and management
capabilities, and further promote reform and transformation in
sales, investment, product, operations, technology, and human
resources.
During the Reporting Period, by further improving its business
structure, gross written premiums from the life insurance business
of the Company amounted to RMB446,562
million, rising by 2.1% year on year; gross written premiums
from the health insurance business reached RMB105,581 million, rising by 26.3% year on year;
and gross written premiums from the accident insurance business
were RMB14,943 million, a
year-on-year increase of 1.8%.
In 2019, by consistently focusing on business value growth and
accelerating reform and transformation, the Company's core
businesses developed at a faster speed with its value of one year's
sales rising significantly. With its sales force expanding
steadily, quality of the sales force improved constantly. As at the
end of 2019, the total number of the Company's sales force reached
1.848 million.
Exclusive Individual Agent Channel. In 2019, focusing on
business value growth, the exclusive individual agent channel
deepened transformation and upgrade in its sales management,
prioritized the growth of protection-oriented business, reinforced
coordinated development of business, sales force and day-to-day
management, and achieved coordinated growth of business scale and
value, with its new business margin of one year's sales increasing
significantly. During the Reporting Period, gross written premiums
from the exclusive individual agent channel amounted to
RMB436,621 million, an increase of
6.9% year on year. First-year regular premiums from the channel
were RMB83,865 million, an increase
of 5.8% year on year, which accounted for 99.67% of first-year
premiums of long-term insurance. In particular, the percentage of
first-year regular premiums with a payment duration of ten years or
longer in first-year regular premiums was 62.24%, an increase of
15.89 percentage points year on year. Renewal premiums amounted to
RMB336,676 million, an increase of
6.2% year on year. New business margin of one year's sales of the
channel reached 45.3%, a year-on-year increase of 3.2 percentage
points. In 2019, the sales force of the channel was improved in
both quantity and quality, which substantially drove business
growth. As at the end of 2019, the number of exclusive individual
agents was 1.613 million, an increase of 12.1% from the end of
2018. The quality of the sales force was improved constantly, with
the number of monthly average productive agents increasing by 34.9%
year on year and the monthly average number of agents selling
designated protection-oriented products increasing by 43.8% year on
year. As at the end of 2019, the number of upsales agents which
were included in the exclusive individual agents reached 577,000,
an increase of 42.1% from the end of 2018, outpacing the growth of
the exclusive individual agent force as a whole. In 2019, the
day-to-day management of the channel was strengthened
significantly, with various day-to-day management indicators being
improved.
Bancassurance Channel. In 2019, with an emphasis on
regular premium business, the bancassurance channel furthered its
business restructuring, with its new business margin of one year's
sales of the channel rising constantly. During the Reporting
Period, gross written premiums from the bancassurance channel
amounted to RMB70,060 million, a
decrease of 8.8% year on year. First-year regular premiums were
RMB23,820 million, an increase of
2.5% year on year. In particular, first-year regular premiums with
a payment duration of ten years or longer were RMB5,925 million (a year-on-year increase of
47.2%), accounting for 24.87% of the first-year regular premiums, a
year-on-year increase of 7.55 percentage points. New business
margin of one year's sales of the channel reached 23.8%, increasing
by 5.1 percentage points year on year. Renewal premiums amounted to
RMB44,623 million (a year-on-year
increase of 1.9%), accounting for 63.69% of the gross written
premiums from this channel, a year-on-year increase of 6.71
percentage points. As at the end of 2019, as a result of
strengthening its sales team management and improving sales force
quality, the number of sales representatives of the bancassurance
channel was 166,000, with the monthly average active insurance
planners for long-term business increasing by 36.1% year on
year.
Group Insurance Channel. In 2019, the group insurance
channel consistently deepened business diversification, stepped up
efforts to expand key business segments, and achieved rapid
development of various businesses. During the Reporting Period,
gross written premiums from the group insurance channel were
RMB28,846 million, an increase of
9.2% year on year. Short-term insurance premiums from the channel
were RMB23,833 million, an increase
of 12.1% year on year. The Company actively carried out the pilot
program of tax deferred pension insurance business and consistently
promoted the tax- advantaged health insurance business. With
stricter performance appraisal and seeking for quality enhancement
of its sales team, the number of direct sales representatives was
65,500 as at the end of 2019, among which, the number of
high-performance representatives reached 45,000.
Other Channels. In 2019, gross written premiums from
other channels reached RMB31,559
million, an increase of 29.9% year on year. The Company
actively developed policy-oriented health insurance businesses,
including supplementary major medical expenses insurance, long-term
care insurance and supplementary medical insurance for social
security, which consistently led the market. As at the end of the
Reporting Period, the Company carried out over 230 supplementary
major medical expenses insurance programs, providing services to
nearly 400 million people in 31 provinces and cities. It also
provided supplementary medical insurance protection for social
security in 15 provinces, serving 38 million people, undertook over
600 medical insurance administration projects, covering more than
100 million people, and offered long-term care insurance protection
for more than 13 million people. In 2019, the Company saw a faster
growth in its online sales business. The Company emphasized product
innovation, reinforced quality management and guarded against
business risk. To optimize customer experience, the Company
provided quick and convenient ways for online insurance application
and diversified online services to insurance customers via various
models, including direct sales on the Company's official website,
integration of both online and offline sales, and collaboration
with platform resources.
The Company actively consolidated internal and external
ecological resources, steadily pushed forward its coordinated
business development with other subsidiaries of China Life
Insurance (Group) Company, carried out market expansion and widened
customer base through the strategy of "One Customer, One-stop
Service". In 2019, premiums from property insurance cross-sold by
the Company increased by 9.4% year on year, whereas new bids of
enterprise annuity funds and pension security products of China
Life Pension Company Limited cross-sold by the Company grew by
26.7% year on year. Meanwhile, the Company entrusted China Guangfa
Bank Co., Ltd. ("CGB") to sell bancassurance products, with
first-year regular premiums for 2019 increasing by 52.8% year on
year. The number of new debit cards and credit cards jointly issued
by the Company and CGB during the year exceeded one million, which
demonstrated the synergy effects of platform operation, positive
interaction and mutual benefits to both companies.
In 2019, the global economic growth slowed down synchronously,
with repeated trade frictions becoming the biggest disturbance
factor. The growth of domestic economy slightly slowed down but
generally remained stable. The interest rate of the domestic bond
market fluctuated and declined within a narrow range, and the stock
market saw a significant rise compared to the beginning of 2019.
The Company constantly reinforced its asset-liability management
and increased the allocation in yield seeking assets and strategic
assets. In respect of fixed-income investment, the Company
optimized the portfolio structure and accumulated assets with long
duration. While grasping opportunities to allocate to traditional
fixed-income assets with long duration, it increased allocation to
non-standard financial assets and bank capital replenishment
instruments, etc. As a result, the Company's investment yields were
increased while the credit risk was strictly controlled. In respect
of its open market equity investment, the Company achieved
satisfactory investment returns through effectively implementing
tactical allocations, carrying out rebalancing as appropriate and
optimizing the structure of equity holdings. As at the end of the
Reporting Period, the Company's investment assets reached
RMB3,573,154 million, an increase of
15.1% from the end of 2018.
As at the end of the Reporting Period, among the major types of
investments, the percentage of investment in bonds changed to
39.48% from 42.20% as at the end of 2018, the percentage of term
deposits changed to 14.98% from 18.02% as at the end of 2018, the
percentage of investment in debt-type financial products increased
to 11.62% from 11.32% as at the end of 2018, and the percentage of
investment in stocks and funds (excluding money market funds)
increased to 11.00% from 9.03% as at the end of 2018.
The Company's debt-type financial products mainly concentrated
on sectors such as transportation, public utilities and energy, and
the financing entities were primarily large central-owned
enterprises and state-owned enterprises. As at the end of the
Reporting Period, over 99% of the debt-type financial products held
by the Company had ratings of AAA or above by external rating
institutions. In general, the quality of the debt-type financial
products invested by the Company was in good condition and the
risks were well controlled.
In 2019, the Company's net investment income was RMB149,109 million, an increase of RMB16,092 million from 2018 and a year-on-year
increase of 12.1%. As the Company increased its allocation in
interest-bearing assets such as bonds with long duration, stocks
with high dividends and non-standard assets in recent years,
although the interest rate fluctuated and trended downwards, the
Company's net investment yield remained stable at 4.61%. In the
meantime, in respect of the equity investments, the Company
followed the long-term investment direction and effectively
implemented tactical allocations under the established strategic
asset allocation guidance, and the Company's investment income rose
significantly. The gross investment income of the Company reached
RMB169,043 million, an increase of
RMB73,895 million from 2018, and the
gross investment yield was 5.24%, an increase of 195 BPs from the
end of 2018. The comprehensive investment yield taking into account
the current net fair value changes of available-for-sale securities
recognised in other comprehensive income was 7.28%, an increase of
418 BPs from the end of 2018.
2020 Outlook
Looking ahead, we firmly believe that the Chinese economy will
maintain its long-term sound development and its high-quality
growth fundamentals remain unchanged, and that the domestic
insurance industry is still at an important stage full of strategic
opportunities. In 2020, we will continue to pursue high-quality
development, stick to value creation during the whole process of
the Company's reform and development, and make concrete progress
with "China Life Revitalization". We will vigorously push forward
the market-oriented reforms, accelerate the implementation of the
"Dingxin Project", speed up the digitalization process in business
operation, enhance the application of digital technologies in
sales, services and management, and strengthen the application of
technological empowerment in sales, services and business
operation. We will speed up the integration of service platforms,
and shape the Company's operation and services to be more
integrated, intelligent and ecological. We will also strengthen
risk management and control, strive to prevent major risks, enhance
asset-liability management, implement "Environmental, Social and
Governance (ESG)" concept, and advance our corporate
governance.
"Many a little makes a mickle." The Company will continue to
uphold its original aspiration of "Protecting People's Good Life",
revitalize China Life, forge ahead with the reform initiatives, and
strive to create value for our shareholders, customers and society,
making unremitting efforts to promote the high-quality development
of the Chinese insurance industry, build a moderately prosperous
society in all respects, and realize the first centenary goal of
the country.
******
About China Life Insurance Company Limited
China Life Insurance Company Limited is a life insurance company
established in Beijing, China on
30 June 2003 according to the
"Company Law of the People's Republic of
China" and the "Insurance Law of the People's Republic of China". The Company
was successfully listed on the New York Stock Exchange, the Hong
Kong Stock Exchange and the Shanghai Stock Exchange on 17 and
18 December 2003, and 9 January 2007, respectively. The Company's
registered capital is RMB28,264,705,000.
The Company is a leading life insurance company in China and possesses an extensive distribution
network comprising exclusive agents, direct sales representatives,
and dedicated and non-dedicated agencies. The Company is one of the
largest institutional investors in China, and becomes one of the largest
insurance asset management companies in China through its controlling shareholding in
China Life Asset Management
Company Limited. The Company also has controlling shareholding in
China Life Pension Company
Limited.
Our products and services include individual life insurance,
group life insurance, and accident and health insurance. The
Company is a leading provider of individual and group life
insurance, annuity products and accident and health insurance in
China. As at 31 December 2019, the Company had approximately
303 million long-term individual and group life insurance policies,
annuity contracts, and long-term health insurance policies in
force. We also provide both individual and group accident and
short-term health insurance policies and services.
Forward-looking statements
Certain statements contained in this press release may be viewed
as "forward-looking statements" as defined by Section 27A of the
U.S. Securities Act of 1933 and Section 21E of the U.S. Securities
Exchange Act of 1934, as amended. Such forward-looking statements
involve known and unknown risks, uncertainties and other factors,
which may mean that the actual performance, financial condition or
results of operations of the Company could be materially different
from any future performance, financial condition or results of
operations implied by such forward-looking statements. Further
information regarding these risks, uncertainties and other factors
is included in the Company's Annual Report on Form 20-F for the
fiscal year ended 31 December 2018
filed with the U.S. Securities and Exchange Commission, or SEC, on
24 April 2019; and in the Company's
other filings with the SEC. You should not place undue
reliance on these forward-looking statements. Unless
otherwise stated, all information provided in this press release is
as of the date of this press release, and the Company undertakes no
duty to update such information, except as required under
applicable law.
Unless otherwise indicated, the Chinese insurance market
information set forth in this press release is based on public
information released by China Banking and Insurance Regulatory
Commission.
For further information, please contact:
Media enquiries
Ms. Yinghui Li
China Life Insurance Company Limited
Tel: +86 10 6363 1191
Fax: +8610 6657 5112
E-mail: liyh@e-chinalife.com
Mr. Isaac Yau (Hong Kong)
Citigate Dewe Rogerson
Mobile: +852 6337 1723
Tel: +852 3103 0112
Fax: +852 2524 5599
E-mail: isaac.yau@citigatedewerogerson.com
Mr. Benny Liu (Beijing)
Citigate Dewe Rogerson
Mobile: +86 135 2188 9320
Tel: +8610 6567 5056
Fax: +8610 6567 5865
E-mail: benny.liu@citigatedewerogerson.com
Investor and analyst enquiries
Ms. Grace Hou
China Life Insurance Company Limited
Mobile: +86 138 1009 6827
Tel: +8610 6363 1241
Fax: +8610 6657 5112
Email: houjue@e-chinalife.com
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SOURCE China Life Insurance Company Limited