Insurance funds exceed one trillion this year "increasing positions"! Super "long-term buyers" in A-shares emerge

In this year's continuously strengthening stock market, there is a long-term force quietly investing in the "structure" of investors — that is insurance capital.

For ordinary retail investors, this change may only be "subtle."

You may suddenly notice: the buying of blue-chip stocks has become increasingly "abundant"; previously "neglected" dividend assets are becoming more active; there are people "bottom-fishing" in unpopular financial stocks; "white elephant stocks" like home appliances and telecom operators are moving more nimbly; those internet platforms that have been quiet for 3 to 4 years are starting to rise and challenge the "new highs" since 2021.

The "invisible hand" behind this may be the insurance capital that has been low-key for many years. However, this year's insurance capital is different from the past; under the combined effect of policies and the market, the pace of insurance capital "bottom-fishing" in the equity market seems to have been pressed on the "accelerator," with various insurance institutions continuously entering the market through various channels.

A profound "change" in market structure has already begun...

Two Key "Indicators"

To understand the intensity of insurance capital's increased positions this year, we first need to clarify their "funding base."

However, insurance capital is not public funds; they do not need to disclose too much information and certainly will not "serve up" the entire portfolio for outsiders to "stretch their necks" to see.

Therefore, regarding how much insurance capital has increased its positions this year and which asset classes and markets it has mainly focused on, the outside world is not clear — everyone only knows that there is a lot of overall funding.

However, the entire "bottom line" has been "revealed" in the publicly available information from regulatory authorities.

Among the series of data released by regulatory agencies, two figures are particularly noteworthy: one is the "balance of funds in use," which refers to the total scale of all funds that insurance companies can invest, essentially a "investable fund pool."

The other is the "book balance" of various insurance institutions directed towards major asset classes, which reflects the end-of-period "scale" of specific assets held by insurance companies, calculated according to accounting standards.

These two figures are very important; one reflects the overall "capacity" of funds that insurance capital needs to allocate, while the other reflects the specific "direction" of insurance capital.

Insurance Capital's Funding Base Surges Over 4 Trillion

According to information from relevant financial regulatory departments, as of the end of the third quarter of this year, the overall investable "funding base" of insurance companies has increased by more than 4 trillion.

Specifically, by the end of 2024, the scale of this "investable fund pool" is 33.36 trillion yuan; by the end of the third quarter of 2025, it has expanded to 37.46 trillion yuan, a quarter-on-quarter increase of 4.1 trillion.

Of course, a major part of this comes from the growth of premiums, but it is not necessarily all from newly sold policies. This should also include some returns from this year's capital markets and other investment projects.

Overall, in the first nine months of this year, the funding base of Chinese insurance companies has expanded by more than 4 trillion yuan, an increase of about 12%.

This incremental scale is equivalent to the total deposit volume of a medium-sized local bank and should not be overlooked.

Direct Investment in the Stock Market Increases by Over 1 Trillion

Research shows that a significant portion of the new funds in the insurance industry this year has been used to increase positions in the stock market — primarily in the A-share market The "accounts" related to insurance funds investing in the stock market include two: one is the "book balance" of direct stock investments, and the other is the "book balance" of indirect investments in securities investment funds.

First, let's focus on the scale of "direct" stock investments.

Statistics show that in the first three quarters of this year, the scale of direct stock investments by insurance institutions increased by approximately 1.19 trillion yuan compared to the beginning of the year, with an increase of nearly 50%.

Specifically, by the end of the fourth quarter of 2024, the scale of stocks directly held by insurance funds will be 2.43 trillion yuan; by the end of the third quarter of 2025, this figure will rise to 3.62 trillion yuan.

In comparison, the increase in the balance of fund utilization mentioned earlier is 4 trillion yuan, indicating that more than one-third of the newly added funds this year will be directed towards stocks—mainly A-share stocks.

Even considering the appreciation of original holdings (the increase in the CSI 300 Index in the first three quarters), there should be over 800 billion yuan in new investments, which is indeed the strongest new force in the industry.

"Indirect investment" in the stock market is not to be underestimated

But this is not all; the balance of "securities investment funds" for indirect investment in the stock market is also growing rapidly.

Preliminary statistics show that in the first three quarters, insurance funds' investment in securities investment funds "increased" by approximately 290 billion yuan.

Specifically, by the end of the fourth quarter of 2024, the scale will be 1.68 trillion yuan, and by the end of the third quarter of 2025, it will rise to 1.97 trillion yuan.

Considering that institutions have gradually withdrawn from fixed-income funds for various reasons this year, a considerable proportion of this nearly 300 billion yuan increase should also be attributed to equity funds.

Therefore, regardless of how the statistics are calculated, the investment of insurance funds in the stock market—mainly A-share assets—this year may approach 1 trillion yuan, reaching a historical peak.

Additionally, while the investable scale of insurance funds is expanding, more than one-third of the newly added funds have been directed into equity-related assets, which fully reflects the importance that insurance funds place on the relevant market.

What drives insurance funds to invest in equities?

So why are insurance funds actively investing in the stock market?

In addition to policy calls, insurance funds also have a demand to increase equity investments.

Analyst Ge Yuxiang from Zhongtai Securities mentioned in a recent analysis report: without external capital supplementation, insurance funds face a triangular challenge of "increasing solvency adequacy ratio—raising equity allocation ratio—continuation of external low-interest-rate environment."

In simple terms, this statement expresses that:

In a low-interest-rate environment with limited bond returns, life insurance companies have a strong motivation to shift some funds from fixed income to higher-return equity assets in order to maintain a long-term stable financial statement and solvency.

Zhitang noted that as of the end of September this year, the proportion of direct stock investments by insurance companies has reached 10% of the fund utilization balance, which is at a historical high.

And this may not be the end.

Whether it is the expansion of premiums by insurance funds or the downward trend of interest rates in the fixed income and deposit markets, both are driving the continuation of this trend. A steadily rising stock market, which is discovering value, may also strengthen the confidence of insurance funds.

Specific varieties are intriguing

In addition, more news shows that insurance funds are continuously increasing their direct investments in stocks, making high-dividend assets in A-shares and Hong Kong stocks an important direction.

According to the latest statistics from Guojin Securities: From 2024 to date, insurance funds have increased their stakes in a total of 47 listed companies, with a clear preference for dividend styles, especially H-shares. In addition to China Ping An increasing its stakes in major banks such as ICBC, CCB, Postal Savings Bank, ABC, and CMB, as well as insurance companies like China Life and CPIC, public utilities and transportation are also important directions.

A research report from Guotai Junan Securities believes that behind the signs of increased equity positions, on one hand, it benefits from insurance companies continuously enhancing their stock asset allocation, and on the other hand, it benefits from the recovery of the equity market leading to an increase in the market value of stock assets