Insurance funds are not affected by short-term emotional fluctuations; overall position changes are minimal.

Reporter: He Kui

Amid the impact of geopolitical conflicts in the Middle East, a rise in global risk-avoidance sentiment has led to a pullback in equity markets, which has also put pressure on insurance funds’ investments. A review by a reporter from the Shanghai Securities News found that, based on the past month’s return data, nearly half of equity-focused insurance asset management products have posted losses.

However, the reporter learned from industry insiders that although equity markets have retreated due to the Middle East geopolitical conflict, increasing pressure on insurers’ investments, insurance asset management institutions have remained calm when adjusting their positions, with overall position changes not being significant. Many insurance asset management institutions believe there is no need to worry about short-term fluctuations caused by rising risk-avoidance sentiment disrupting the market; over the long term, China’s capital markets still offer good investment opportunities. Moreover, as international capital grows increasingly concerned with safety, the security of Chinese assets has become more prominent, and there is potential to attract more funds to flow in.

Insurance funds’ overall position changes not significant

Wind data shows that as of the market close on March 24, among more than 1,800 equity-focused insurance asset management products across the entire market, nearly 900 products recorded negative returns over the past month, accounting for nearly half. Specifically: more than 40 products had losses exceeding 10%, and more than 270 products had losses exceeding 5%.

The continued decline in the market has brought some pressure to certain insurers’ accounts. “Some absolute return accounts were issued later in the year, so the market positions at which they were established were relatively high. After the market retraced, negative returns appeared, which could lead to a passive reduction in position control over drawdowns.” A head of equity investment at an insurance asset management institution told the Shanghai Securities News reporter. However, the scale of these accounts is very small and is not enough to have much impact on the market.

In recent times, the topic of insurers cutting positions triggered by the market pullback has received significant attention. The reporter learned from industry insiders that although insurers are currently being tested by market volatility, they still remain optimistic about long-term investment opportunities in the capital market, and their overall positions have not decreased noticeably. A general manager of an insurance asset management institution in Shanghai told the Shanghai Securities News reporter: “Our holdings haven’t changed much.”

A head of equity investment at a pension insurance company said in an interview with the Shanghai Securities News reporter that the Middle East geopolitical conflict, for the market, is more about amplifying short-term volatility, with especially large fluctuations in the technology and non-ferrous metals sectors. But from a long-term perspective, the A-share market’s investment logic mainly lies in an improvement in domestic fundamentals. The current A-share market still has strong resilience and attractiveness.

“A long-term perspective suggests that geopolitical conflicts will increase the market’s emphasis on safety. China’s advantages in safety are becoming more prominent. As international capital re-prices China’s assets, it may attract more funds into the Chinese market in the future.” A general manager of the investment and research department at an insurance asset management institution told the Shanghai Securities News reporter.

Increasing allocation to equities is still the main investment line for insurers

In a low interest-rate environment, together with an increase in the sales scale of dividend insurance, increasing allocations to equity-type assets remains the main investment line for insurers in 2026.

In fact, since 2025, insurers have been increasing allocations to equity-type assets. Data from the National Financial Regulatory Administration shows that as of the end of 2025, the book value balances of stock investments for property insurance companies and life insurance companies were approximately RMB 226.8 billion and RMB 3.5 trillion, respectively, up 41.66% and 54.67% from the beginning of 2025.

Several industry insiders believe that from the liabilities side, residents’ “deposit shifting” is still expected to further promote the sales of dividend insurance. Compared with traditional insurance, dividend insurance has a higher risk tolerance, which can further enhance the flexibility of insurers’ equity asset allocation.

As for specific investment targets, the reporter learned from industry insiders that: new productive forces represented by technological innovation are the sectors that insurers collectively pay attention to; under expectations for earnings recovery and price increases, low-valuation targets in the cyclical sectors are also favored.

Tian Gang, General Manager of Equity Investment at PICC Asset Management, said that AI-related industries are a future high-potential segment for generating excess returns. For example, the foundation for AI development is computing power, and computing power requires substantial support from electricity; as computing-electric coordination emerges, it will drive huge market demand.

“In the context of a rebound in PPI year over year, cyclical sectors will have the foundation to generate excess returns. However, the market’s upside potential is closely related to the magnitude of price increases. There will still be certain investment opportunities in the future, but it is necessary to grasp the investment timing and control positions properly.” The general manager of equity investment at an insurance asset management institution in Shanghai said.

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Editor: Qin Yi