Guotai Haitong: The new energy vehicle insurance market continues to expand, maintaining an "overweight" rating for the industry.

Guotai Haitong published a research report stating that the current car insurance premium scale of Shanxi Guoxin Energy Corporation is in a rapid growth phase. Although the overall industry is facing losses, the comprehensive cost ratio has shown a continuous improvement trend. It is expected that there is ample room for premium growth in the coming years, and the profit level is likely to improve further. PICC P&C, as the leading insurance company in China, has accumulated profound resources, channels, and technical advantages in car insurance. By 2025, PICC P&C's market share in the new energy vehicle insurance sector is expected to exceed 30%, and it is anticipated to achieve stable profitability first. The report maintains an "overweight" rating for the industry, recommending the stock PICC P&C (02328). The main points from Guotai Haitong are as follows: The car insurance premium scale of Shanxi Guoxin Energy Corporation continues to rise, but the industry is facing ongoing losses. The domestic stock of new energy vehicles is continuously increasing, driving the rapid expansion of the new energy vehicle insurance market. By 2025, the industry's premium scale is expected to reach 190 billion yuan, a year-on-year increase of 34.8%. Currently, new energy vehicle insurance relies on exclusive terms, adding coverage for the three electric systems and charging scenarios, thereby forming a risk protection system that differs from traditional fuel vehicle insurance. However, new energy vehicles face issues such as a relatively high accident rate and expensive maintenance costs for the three electric systems. Coupled with the fact that insurance companies' premium pricing has not adequately covered risk costs, the industry is experiencing ongoing losses. Under regulatory guidance, the pricing space for Shanxi Guoxin Energy Corporation's car insurance is relatively limited, while the high complexity of damage assessment and repairs raises overall payouts. The pre-sale terms and pricing of Shanxi Guoxin Energy Corporation's car insurance adhere to unified industry standards. Insurance companies have limited flexibility in adjusting prices, making it difficult to simply improve rate adequacy by reducing coverage responsibilities or raising premiums. The sales channels during the sales phase are leaning towards online internet platforms and auto manufacturers, weakening the influence of traditional offline agency channels, with sales expenses for new energy vehicle insurance generally lower than for traditional car insurance. After-sales are affected by technical and qualification barriers and component costs, making damage assessment and repairs for new energy vehicles difficult and costly. The design of terms and pricing by American insurance companies allows for more efficient risk pricing, with little difference between the sales and after-sales phases compared to China. The car insurance market in the United States exhibits significant market-oriented characteristics, allowing insurance companies greater freedom in terms design and pricing, enabling them to flexibly adjust rates to match risk costs, thus having a stronger capacity to regulate profits. The sales channels and after-sales claims service processes for new energy vehicle insurance in China and the U.S. are basically consistent, with both countries facing operational pressures due to the complexity of vehicle damage assessments and high repair costs. There is ample room for premium growth in new energy vehicle insurance, and multiple internal and external favorable factors are expected to further improve industry profitability. It is estimated that from 2026 to 2030, the compound annual growth rate (CAGR) of car insurance premiums for Shanxi Guoxin Energy Corporation may reach 14.1%, with sufficient incremental market scale. At the same time, with the popularization of intelligent driving technology, the standardization of the maintenance market, and continuous improvement of pricing mechanisms by insurance companies, it is expected that the industrys accident rates and claims pressures will gradually ease, and profitability is likely to improve further. Risk Warning: The improvement process of new energy vehicle maintenance costs may not meet expectations; there is some uncertainty in the external policy environment.