Open source securities: In October, the growth rate of insurance premiums for insurance companies fell, focusing on the progress of the 25-year grand opening preparations and product switches.

Open source securities released a research report stating that the main reason for the slowdown in the premium growth rate of listed insurance companies in October was the anticipated interest rate cut, which led to some demand being released early. Furthermore, listed insurance companies shifted their focus to a strong start to the year. The fiscal debt policy has shown positive signs, and the supply of ultra-long-term bonds by local governments is expected to increase significantly, which is beneficial for insurance companies in reducing their asset-liability duration gap, lowering interest rate risk, and stabilizing long-term interest rates. Currently, the market is focusing on the performance of the liability side in the lead-up to 2025. From the perspective of NBV growth prospects, the impact of value may be greater than that of quantity. The integration of personal insurance and bancassurance, optimization of product structures, and anticipated reduction in the anticipated interest rate are expected to further support the increase in value rate. Changes in supply-side production capacity and new demand are also being monitored. It is expected that the liability side of life insurance companies will maintain good growth in 2025. In terms of recommendations, with the stable implementation of policies for maintaining growth, stabilizing the stock market, and stabilizing the real estate market, it is conducive to the asset side of life insurance companies. The liability side is still in an upward cycle, and it is optimistic about targets with strong prosperity on the liability side and outstanding equity flexibility. China Pacific Insurance (601601.SH), Ping An Insurance (601318.SH), China Life Insurance (601628.SH), and New China Life Insurance (601336.SH) are recommended. Key points of Open source securities are as follows: The growth rate of premiums in October has slowed down, and attention is on preparations for the start of the year in 2025 and the progress of product transition. Cumulative from January to October 2024: Total premiums of 5 listed insurance companies increased by 5.9% year-on-year, a decrease of 0.3 percentage points from September. Among them, Ping An Insurance +9.0%, The People's Insurance +7.0%, China Life Insurance +4.9%, China Pacific Insurance +2.4%, and New China Life Insurance +1.8%. Single month of October 2024: The total premiums for personal insurance of 5 listed insurance companies amounted to 71.3 billion yuan, a year-on-year decrease of 1.2%, which is a decrease of 7.3 percentage points from September. Among them: China Pacific Insurance +2.3%, New China Life Insurance -0.2%, The People's Insurance -0.9%, China Life Insurance -2.6%. The slowdown in premium growth of 4 listed insurance companies in October was mainly due to the anticipated interest rate cut leading to the early release of some demand, and secondly, the focus of listed insurance companies shifted to a strong start to the year. The reason for the positive growth in monthly premiums of China Pacific Insurance was the low base in October 2023, with a year-on-year decline of 25%. Outlook: It is expected that the liability side will maintain high-quality growth in 2024. Attention is on the progress of the structural transition to dividend insurance and the preparation for the start of the year in 2025. Considering the reduction of anticipated interest rates, the integration of personal insurance and bancassurance, and the continued optimization of term structures by insurance companies, it is expected that the increase in value rate will continue in 2025. The stability of the scale of personal insurance channels + capacity enhancement, the opening up of the 1+3 bank-insurance channel, the continued strong demand for long-term pension savings, the advantages of insurance returns and liquidity, and the expectation of maintaining stable growth in new policies in 2025, it is expected that the liability side will continue to be prosperous in 2025. In October, the first-year premium growth rate of long-term insurance of The People's Insurance declined, while the first-year growth rate of health insurance continued to expand By the end of October 2024, the total premiums of the personal insurance sector of The People's Insurance amounted to 145.6 billion yuan, a year-on-year increase of 7.0%, which is a decrease of 0.3 percentage points from September. The first-year premium for long-term insurance was 55.7 billion yuan, a year-on-year decline of 4.2%, which is an improvement of 1.5 percentage points from September. In October, the first-year premium for long-term insurance was 1.12 billion yuan, an increase of 44.9% year-on-year, which is a decrease of 39.2% from September. Among them, single pay was 0.4 billion yuan, a year-on-year decrease of 11.8%, and period pay was 7.2 billion yuan, a year-on-year increase of 122.1% (life insurance/health insurance increased by 73.6%/183.3% respectively). The growth rates in October overall declined, with expectations that the demand released early due to the anticipated interest rate cut is related, and the period pay first-year premium maintains a high growth due to the low base in September, while the first-year premium growth rate of health insurance continues to expand. In October 2024, the growth rate of auto insurance continued to improve, and the structure of non-auto insurance continued to optimize In October 2024, the property insurance premiums of 4 listed insurance companies were 74.8 billion yuan, an increase of 9.5% year-on-year, which is an increase of 0.5 percentage points from September. The year-on-year growth rates for each of the companies in October were: ZA ONLINE +36.1 (September +44%), Ping An Property Insurance +12.2% (September +10.9%), PICC Property Insurance +7.8% (September +7.2%), and Taikang Property Insurance +3.9% (September +6.7%). In October 2024, the year-on-year sales volumes of passenger cars/electric vehicles were +10.7%/+49.6%, with cumulative growth rates of +3.7%/+33.9% compared to September, showing significant improvement. In October, the year-on-year growth rate of auto insurance premiums of PICC Property Insurance was +6.4%, which is an increase of 1.1 percentage points from September, and the cumulative year-on-year growth rate in October was +3.6%, an increase of 0.4 percentage points from September. The year-on-year growth rate of non-auto insurance in October was +12.3%, an increase of 3.4 percentage points from September, and the cumulative year-on-year growth rate in October was +6.2%, an increase of 0.2 percentage points from September. The month-on-month growth rates for health insurance/agricultural insurance/liability insurance/commercial property insurance/credit guarantee insurance/freight insurance were +25.6%/-1.4%/+7.8%/+1.1%/-22.8%/+22.2%, showing improvements in health insurance, liability insurance, and freight insurance, while high-risk businesses such as credit guarantee insurance continue to be under pressure. Looking ahead, with the recovery of new car demand and the improvement in average insurance premiums, it is expected that the growth rate of auto insurance premiums will continue to improve, and the structure of non-auto insurance is expected to continue to improve. Risk warning: Economic recovery is slower than expected; Insurance product demand does not recover as expected.