New China Life bancassurance margins fall amid rule risks

Overall new business value declined 8% year on year in the second quarter.

New China Life Insurance faces pressure from weaker equity markets and regulatory changes affecting its bancassurance business, which could weigh on earnings in the second half of 2026.

The insurer has high exposure to market movements, with 90% of its equity investments classified at fair value through profit or loss in the first half, according to CGS International. 

CGS said this could put pressure on third-quarter investment income after the CSI 300 Technology Index fell 27% in the quarter to 26 August, reversing an 81% rise in the second quarter. 

CGS expects second-half net profit to fall below the $3.4b (CNY22.8b) recorded in the first half because of weaker investment markets. 

First-half profit rose 54% year on year, helped by a 44% increase in investment income, although investment income growth slowed to 3% in the second quarter from 121% in the first. 

Bancassurance is another area to watch. Its new business value margin fell 16% year on year to 22% in the first half, whilst bancassurance new business value increased just 2%. 

The channel still accounted for 48% of total new business value. 

Overall new business value rose 12% in the first half, but fell 8% year on year in the second quarter after growing 25% in the first. 

CGS cited regulatory uncertainty in bancassurance, weaker-than-expected new business value growth and lower investment yields as key downside risks.  

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