Comprehensive system acceleration: Long-term care insurance explores the "Insurance+" model in the health and wellness sector

Caregiver for her longtime partner for over 27 years, Ju Ren of Changzhou, Jiangsu Province, used the phrase “helping someone in their time of need” to describe the role of long-term care insurance (hereinafter referred to as “LTCI”) to reporters. Her words also capture the significance of LTCI for tens of millions of families with members who are unable to care for themselves. Recently, the General Office of the CPC Central Committee and the General Office of the State Council issued the “Opinions on Accelerating the Establishment of a Long-Term Care Insurance System” (hereinafter referred to as the “Opinions”), clarifying that it will take around 3 years to basically establish an LTCI system covering all people and coordinating urban and rural areas. This marks that this social insurance “sixth coverage” has officially moved from limited pilot programs to the nationwide rollout stage.

Interviewees believe that, after nearly a decade of pilots, LTCI has become an important safety-net system for China to respond to population aging. As the core force of social participation, commercial insurance companies will step up efforts in every area—from administering services to product innovation—injecting key momentum into the development of a multi-tiered long-term care protection system.

Policy implementation

Insurance firms actively respond

The release of the “Opinions” sets a clear timeline for LTCI to be established nationwide. Major insurance companies responded to the policy arrangements immediately, incorporating LTCI development into their corporate strategic planning.

Ding Xiangqun, Chairman of PICC, said at a 2025 annual performance briefing held recently that she will implement the “Opinions” earnestly and strategically develop LTCI. She said that PICC will actively promote a transformation from being a provider of insurance products to being a provider of insurance services—namely, shifting from simply selling insurance products to a “product + services” model. Between insurance products and elderly care and nursing services, she said, a tighter linkage mechanism will be established. Focusing on people with disabilities and dementia, PICC will improve the “insurance + elderly care and nursing” services, exploring a diversified elderly-care ecosystem covering “community-based care, home-based care, and institution-based care.”

Meanwhile, Hou Jin, Assistant President and Chief Actuary of China Life, said recently that China Life will contribute China Life’s strength to the steady and orderly rollout of LTCI with a responsible corporate attitude, high-quality service supply, and professional operation and management.

Since LTCI pilots began in 2016, they have achieved many substantive results, laying a solid foundation for nationwide establishment. In this process, multiple insurance companies have already participated deeply in LTCI business.

According to Hou Jin, since 2016, China Life has actively participated in over 70 LTCI project pilots, accumulating professional capabilities and extensive experience. It has the capability to undertake full-chain LTCI work and has formed an operation and management system with comprehensive services and strong professionalism. At the same time, it has set up professional service teams that are broad in coverage and high in quality and capability, enabling it to provide insured residents with a high-quality LTCI service experience.

Overall, during the LTCI pilot stage, various regions have explored diversified service models including home care, community care, and institutional care. The state has already listed a nationwide unified directory of 36 long-term care service items. At present, the total number of designated long-term care service institutions nationwide has reached 12k, with about 370k practitioners. By the end of 2025, the total number of long-term care practitioners nationwide has exceeded 10k, basically achieving licensed on-the-job status for long-term care practitioners in all provinces.

Zhu Minglai, Director of the Health Economics and Medical Security Research Center at Nankai University, told Securities Daily reporters that commercial insurance companies are important participants in advancing LTCI pilots. They leverage their professional advantages in administering policy-based LTCI, participating deeply in the whole process management such as financial matching, disability assessment, and service quality supervision, improving administrative efficiency and service quality and forming a model that is replicable and scalable. At the same time, in the field of commercial LTCI, they carry out diversified explorations, becoming an important bridge connecting basic protection with market-based differentiated needs.

The “Opinions” further clarifies the core framework of the LTCI system, providing clear rules for rate setting, payment methods, and benefit levels. In the initial stage, it focuses on people with severe loss of self-care ability. In the future, it will study gradually expanding the scope of benefit recipients. Under the benefit-setting approach of “services as the priority, and generally no direct cash disbursement,” it will effectively address the difficulties in caring for people with disabilities and ease the social pain point of “one person becomes unable to care for themselves, and the whole family becomes unbalanced.”

Misaligned development

Building a new “insurance +” track

With the nationwide establishment target of 3 years made clear, LTCI not only becomes an important public-safety safety-net system for China to respond to population aging, but also a potential growth track for insurance institutions to participate in social governance and explore “insurance +” models in the health and wellness and elderly care sector. Commercial insurance companies are entering a new development opportunity, and they also shoulder more industry responsibilities.

Zhou Jin, Partner of Tiaozhi International Financial Industry Consulting, told Securities Daily reporters that LTCI is both a fallback public livelihood system for China to address challenges posed by population aging and a huge market area in which insurance institutions participate in social governance and balance commercial value. It is also a potential track for exploring “insurance +” models in the health and elderly care sector.

Zhou Jin further said that in a multi-tiered long-term care protection system, commercial LTCI needs to develop in a “complementary but differentiated” manner from policy-based LTCI. It can precisely focus from three dimensions: target customer groups, supplemental needs, and product customization. First, it covers people with moderate loss of self-care ability, dementia-related conditions, children with autism, and other special groups that have not yet been included in policy-based LTCI. Second, it meets higher-tier needs such as high-end personalized nursing and rehabilitation and recuperation beyond basic protection. Third, it innovates and develops distinctive products such as tax-advantaged LTCI, critical illness–oriented LTCI, and products featuring conversions between life insurance and nursing liability.

Zhu Minglai also believes that in the future, China will build a multi-tier long-term care protection system of “policy-based LTCI provides the basics and people-benefiting coverage, people-benefiting LTCI fills shortfalls, and commercial LTCI enhances quality.” Meanwhile, to ensure LTCI truly delivers results, insurance companies need to further deepen the integration of “insurance + services,” break away from simple indemnity-based models, and bring long-term care services into the core of claims. By working closely with nursing institutions, and even participating in the construction of institutions, people with care needs can truly receive professional, convenient long-term care services.

With opportunities and challenges coexisting, the nationwide establishment of LTCI still needs to directly face issues encountered in the pilot stage. Zhou Jin believes that LTCI development currently faces three major core challenges: first, insufficient stability of funding channels. It is necessary to explore more scientific, refined funding standards and cost-sharing mechanisms to solve the problem of funding sustainability. Second, the level of participation by commercial institutions needs to be improved: the proportion of personal and corporate commercial contributions is low, and the role of market mechanisms has not yet been fully leveraged. Third, industry service standards vary by region, and there is a lack of nationwide unified standards for disability assessment and for grading and categorizing nursing services.

To address the above issues, Zhou Jin believes that the core solution lies in a dual-wheel drive of standardization and marketization. On the one hand, standardize industry infrastructure and unify service standards to lay a solid foundation for nationwide establishment. On the other hand, increase the input and leverage of commercial capital and market-oriented institutions, balancing the dual needs of insurance companies participating in social governance and achieving commercial objectives. Relying on market-based mechanisms to integrate resources, collaboratively promoting an all-round transformation in areas including diversification of funding channels, wider public awareness and understanding, and standardization of service quality.

Overall, interviewees believe that as nationwide establishment of LTCI gradually takes hold and policy-based LTCI and commercial insurance coordinate in a complementary and differentiated manner, China’s multi-tiered long-term care protection system will continue to improve. It will keep tightening the protection network for people with care needs and effectively address long-term care anxiety in families with care recipients, providing solid support for proactively responding to population aging.

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