Fitch expects China United Property Insurance to maintain stable underwriting in 2025

But increased allocation to risky assets may threaten capital and earnings.

Fitch Ratings expects China United Property Insurance Company Limited (CUPI) to maintain stable underwriting margins and moderate business expansion in 2025, supported by improved capital buffers and disciplined risk selection, despite rising exposure to risky assets and potential investment volatility.

Following a $84m (RMB6b) capital injection in December 2024, CUPI’s comprehensive solvency ratio rose to 228%, up from 196% the previous year. 

This exceeds the 180% regulatory minimum required to operate in agricultural insurance.

Although the core solvency ratio declined to 137% from 156% due to a $204.4m (RMB1.46b) dividend payout, Fitch believes the insurer retains sufficient capital strength to absorb operational and investment risks.

Underwriting performance is expected to remain stable, with CUPI continuing to avoid high-volatility lines and strengthen its risk selection processes. 

However, Fitch notes that CUPI’s increasing allocation to risky assets—equivalent to 74% of shareholders’ equity at end-2024, up from 69%—may heighten capital and earnings volatility. 

The company reported new non-performing investments in 2024, primarily in trust plans tied to the property sector. 

Potential impairment losses related to ongoing real estate sector weakness remain a key risk.

($1.00 = RMB7.18)