China’s insurance industry closed December 2025 with moderate premium growth but faster-rising claims, underscoring mounting pressure on underwriting profitability across both life and non-life segments, according to data from the National Financial Regulatory Administration (NFRA) of China, compiled and analysed by (Re)in Asia.
Total industry premium income across both the life and non-life sectors reached ¥356.54bn in December, up 5.38% year on year, while claims paid rose more sharply to ¥237.14bn, an 8.62% year-on-year increase.
Claims were already elevated from a year earlier, with total payouts reaching ¥2.3t, up 21% from 2023, and many insurers reporting payout ratios above 99%.
Health-related claims are increasing amid rising cross-border medical travel, particularly from Hong Kong to the mainland. The number of Hong Kong residents seeking treatment in mainland China rose to around 60% between 2019 and 2023, driven by lower costs and faster access, with demand concentrated in non-emergency outpatient services such as ophthalmology, dentistry and cosmetic procedures.
Non-life claims surge
Within the non-life segment, premium income rose to ¥128bn in December, a modest 3.9% year-on-year increase, while claims climbed 7.6% year-on-year to ¥119.4bn – the highest it’s been in two years.
Premium volumes remain range-bound outside peak months, while claims continue to trend higher, shifting from ¥60-85bn per month in 2023 to ¥80-100bn in 2024-25, with increasingly pronounced year-end spikes.
By line of business, agricultural insurance posted the sharpest increase, with December 2025 premiums rising to ¥6.1bn, a 199% year-on-year jump. Premium spikes typically occur mid-year, as underwriting and village-level group enrolment are tied to planting seasons rather than the fiscal year.
However, insured exposure expanded only marginally. Agricultural sums insured rose just 0.93% year on year to ¥415.6bn, pointing to minimal protection growth.
Liability insurance, by contrast, shows a different risk profile. Premium income rose a moderate 7.7% year on year to ¥9.2bn in December, but sums insured surged 26.4% to ¥828.8t, making liability the fastest-expanding exposure pool within the non-life segment. While China’s property-liability market remains structurally auto-heavy, this leaves non-auto lines such as liability with scope to deepen, particularly as opening-up is expected to intensify competition and influence insurers’ business-structure choices.
Motor insurance, while remaining the largest non-life line in absolute terms, continues to post structurally modest premium growth. Premium income reached ¥97.7bn, up 2.2% year on year and marking its highest level since 2023, while sums insured rose 7.6% to almost ¥120t. Rising new-energy vehicle (NEV) repair costs and parts prices have pushed motor loss ratios higher in recent years, even as vehicle sales growth and government incentives continue to expand the insured exposure base.
Elsewhere, health (non-life) insurance posted relatively stronger momentum, with December premiums up almost 9.9% year on year to ¥8.7bn, while accident (non-life) insurance also rose 9.3% to ¥4.7bn, though both lines remain smaller contributors to overall non-life premium income.
Regionally, non-life performance was uneven. Eastern China was broadly flat, with only marginal gains in Beijing and Shanghai offset by declines in Guangdong and Jiangsu, while Shandong was a clear outperformer with double-digit growth. Southern China held up better, led by Guangxi and Yunnan, while Central and Western China posted steady mid-single-digit expansion. Northeastern China, by contrast, remained under pressure, with most provinces continuing to contract.
Life carries industry growth
On the other hand, life insurance premiums rose 10% year-on-year to ¥168.3bn, outpacing both non-life. Mid-year momentum strengthened in 2025, suggesting insurers extended campaigns beyond the usual peak.
Whole life products remain dominant in China. In 2025, around 81% of life insurance direct written premiums were generated by whole life policies, reflecting sustained demand for long-term protection and savings solutions. Demographic pressures, ageing trends and evolving retirement needs continue to support demand for capital-preservation and income-oriented products.
Regionally, life insurance growth was broad-based. Eastern China recorded strong gains in Beijing, Jiangsu and Zhejiang, while Central and Western China posted double-digit growth across several provinces. Shanghai was the main outlier, with premiums declining 2.8% year on year to ¥10.47bn
By contrast, accident life insurance remained small and largely flat. December premiums stood at ¥6.9bn, up just 0.38% year on year, with growth uneven across regions. Several large provinces in Eastern China contracted, while only select city-level and inland markets, such as Ningbo and Tianjin, recorded double-digit increases.
Meanwhile, health insurance written by life insurers showed signs of consolidation. December premiums fell 3.56% year-on-year to ¥53.4bn, following a largely range-bound performance over 2023–24. Regionally, growth clustered in wealthier cities such as Shanghai and Shenzhen, while many provinces, particularly in Central and Western China, recorded sharp declines.
Taken together, China’s life segment (including life, accident and health) accounted for 64% of total premiums, generating ¥228.6bn in December, up 6.25% year on year, while claims paid rose more sharply to ¥117.8bn, an increase of 9.68%.
