From Premiums to Unsold Auctions: The Myth of Insurance Company Licenses Shattered

21st Century Business Herald reporter Lin Hanyao, intern Tu Shengqing

Recently, the performance of equity held by insurance intermediary institutions on judicial auction platforms has remained consistently sluggish. The “insurance intermediary licenses” that were once chased by capital are now clearly cooling off.

Since March 2026, on Alibaba Asset’s judicial auction platform, multiple lots of insurance intermediary institution equity have entered auction or liquidation procedures, including the 10% equity interest of Shenzhen Sheng’an Insurance Brokerage Co., Ltd., the 100% equity interest of Baocheng Insurance Sales Co., Ltd., the 90% equity interest of Guizhou Zhongyang Insurance Agency Co., Ltd., and others. Although some projects attracted quite a number of onlookers, there were not many people who actually registered to bid, and auctions failing to attract bids have occurred frequently.

From the “scarce resources” that capital competed for several years ago, to the present—where even repeated price reductions still leave them unsold—the insurance intermediary industry is moving from an initial stage of “license dividend reliance” into a mature stage centered on capabilities and efficiency.

In response to this change, Zhu Junsheng, a postdoctoral researcher and professor in applied economics at Peking University, believes this is not a simple cyclical fluctuation, but a deep reshaping driven jointly by regulation, the market, and the structure of capabilities. In the short term, it is clearing out institutions and profit pressure. In the medium to long term, it is the industry’s process of evolving toward specialization, centralization, and value creation.

“Intermediary institutions that can truly get through the cycle will no longer rely on fee dividends. Instead, they will build sustainable long-term value by leveraging clients, capabilities, and services,” Zhu Junsheng said.

Insurance intermediary equity goes cold

(Image source: Alibaba Asset platform)

Based on publicly available information from the recent period, the cooling of insurance intermediary equity transactions is not a single case, but a fairly widespread market phenomenon.

According to incomplete statistics, in the past two years, the failed-auction rate of insurance intermediary equity on the Alibaba Asset platform has exceeded 50%. Only since March 2026, at least five insurance intermediary institutions’ equity have been put on the auction block. Their reserve prices are mostly in the range of several million yuan, and the overall market reaction has been muted.

Alibaba Asset’s publicly disclosed information shows that the 10% equity interest of Shenzhen Sheng’an Insurance Brokerage Co., Ltd. was auctioned publicly in mid-March 2026, with a reserve price of 3.0336 million yuan, 439 times of viewing, and 0 registrations.

The 100% equity interest of Baocheng Insurance Sales Co., Ltd. will be liquidated on April 1 with a reserve price of 6.3777 million yuan, viewed 501 times, and with 0 registrations.

The 90% equity interest of Guizhou Zhongyang Insurance Agency Co., Ltd. was auctioned with a reserve price of 3.0720 million yuan. This is already the second listing for this asset.

The 100% equity interest of Lijian Insurance Brokerage has already reached its 6th appearance on the auction block this year. The reserve price has been cut step by step from 50 million yuan down to 16.38M yuan.

(Image source: Alibaba Asset platform)

Some insurance intermediary institutions whose equity has been auctioned have shown operating anomalies.

According to the auction announcement, Guizhou Zhongyang Insurance Agency has been included in the list of entities with abnormal operations. The issuance date of its 《Insurance Intermediary License》 is June 28, 2022. The announcement specifically notes: “Because the company has not operated for a long time, no commitment is made regarding the validity or usability of this license.”

The auction introduction for Lijian Insurance Brokerage Co., Ltd. shows that “According to feedback from Lijian Digital Security Technology Group Co., Ltd., the registered capital contribution of 50 million yuan has not actually been paid in. Because the company cannot be contacted via the registered address or business premises, Lijian Insurance Brokerage Co., Ltd. was included in the list of entities with abnormal operations on September 24, 2024.”

From “license mythology” to rational pricing

If you move the timeline back a few years, insurance intermediary licenses used to be a popular resource in the capital market.

Around 2017 to 2020, trading in insurance intermediary equity was once quite active. At that time, the market quotations for national insurance brokerage licenses were generally around 30 million to 40 million yuan. In the auction market for insurance intermediary equity, failed-auction cases were rare, and some high-quality lots could even be sold with a premium. For example, in 2017, Sichuan Jiaotou Chengtai Insurance Brokerage’s 20% shareholder equity interests had a reserve price of 2.61M yuan and ultimately sold for 4.31M yuan.

Behind this heat was mainly the “license dividend.” On the one hand, between 2018 and 2023, the regulatory authorities paused approval for insurance intermediary licenses. With supply tightening, licenses gained strong scarcity. On the other hand, at that time, there was still substantial room for industry fees, and “reporting-issuing integrated” had not yet been fully implemented. Some intermediary institutions relied on commissions and differences in fees to generate considerable returns.

However, in just a few years, this situation has undergone a fundamental reversal. In an interview with reporters, Zhu Junsheng pointed out that recently, the price of insurance intermediary licenses has fallen from about 30 million yuan to around 10 million yuan, and that equity trading has frequently resulted in failed auctions. This reflects a systematic reappraisal of the value of licenses by capital.

This change first stems from a significant decline in the obvious scarcity of licenses. Zhu Junsheng analyzed: “As industry concentration increases and channel policies are gradually unified, the role of the license itself in creating entry barriers weakens. The ‘easy profits’ or ‘channel value’ it carries has declined markedly. Licenses are gradually returning from ‘scarce assets’ to ‘operating tools.’”

Second, Zhu Junsheng said that market profit expectations have also changed. Policies such as “reporting-issuing integrated” compress commission levels and fee space, lowering intermediaries’ short-term cash flow and investment return expectations, which directly affects the capital pricing logic. In addition, investment logic has become more rational. The capital market is paying more attention to intermediaries’ long-term operating capabilities, client resources, and professional service capabilities, rather than simply holding the license itself.

Zhu Junsheng added that from an academic perspective, this change marks the intermediary industry moving from an initial stage of “license dividend reliance” into a mature stage centered on capabilities and efficiency.

“Clean up excess capacity and improve quality” accelerates industry clearing

The cooling of insurance intermediary equity auctions is closely related to the continued clearing out of the industry in recent years.

On February 27, 2026, the National Financial Regulatory Administration disclosed that from 2024 to 2025, nationwide, 3 insurance intermediary groups were investigated and had their licenses revoked or deregistered, and 57 insurance professional intermediary legal entities were handled; 3,730 insurance professional intermediary branches were cleared out, and 226 insurance multi-line agency institutions were cleared. By the end of 2025, the number of insurance professional intermediary legal entities had fallen to 2,513, declining for 6 consecutive years.

The National Financial Regulatory Administration said that the next step will focus on the main lines of work to prevent risks, strengthen regulation, and promote high-quality development. It will steadily do a good job in regulating insurance intermediaries, improve the regulatory system for insurance intermediaries, continuously and in depth advance “cleaning up excess and improving quality,” and optimize the market structure of insurance intermediaries.

In an interview, Zhu Junsheng further elaborated on the deep impact of regulatory policies on intermediaries’ profit models. He pointed out that the current changes in insurance intermediaries’ profit models are essentially a transformation process in which the industry shifts from “extensive expansion” to “high-quality development.” The core drivers come from three aspects: policy, the market, and institutional capability.

First, from the policy perspective, regulatory policies represented by “reporting-issuing integrated” are reshaping the profit foundation of intermediary institutions. The commission structure, channel fees, and the transparency of the entire value chain have improved significantly. The model that relied on high commissions and fee-difference arbitrage in the past can no longer be sustained. Once fees are rigidly constrained, intermediary institutions can no longer obtain profits through “fee space,” and must rely on real service value and clients’ operating capabilities. At its core, this shift drives the industry from “fee-driven” to “capability-driven.”

Second, from the market perspective, requirements for insurance companies are increasing continuously in areas such as multi-channel deployment, product differentiation, and cost control. Market competition is gradually shifting from price-oriented competition to structural competition. Against this backdrop, the profit space for intermediary channels is being compressed. Small and medium-sized institutions face clear profit pressure. When revenue cannot cover constantly rising compliance and operating costs, some institutions choose to exit—becoming a rational outcome.

Third, from the institutions’ own capabilities, intermediary institutions lacking client management, data accumulation, risk management, and digital capabilities find it difficult to sustain their business models. After the disappearance of fee dividends, these institutions lack alternative competitive advantages, and their survival space shrinks significantly.

Zhu Junsheng believes that the current situation where some intermediaries “can’t continue” is not caused by a single policy shock, but rather results from the combined effects of tightened policies, increased market rationality, and capability differentiation. This clearing process helps optimize industry structure and gradually move the intermediary market toward specialization and long-term value creation.

Capital shifts from “buying licenses” to “buying capabilities”

While many small and medium-sized intermediary institutions exit and license value shrinks, some industrial capital is still actively positioning itself in the insurance intermediary business, and industry differentiation is accelerating.

In the past two years, automakers have taken increasingly frequent actions in the insurance intermediary sector.

In 2025, BMW was approved to establish BMW (China) Insurance Brokerage Co., Ltd.; Great Wall Motor entered the insurance intermediary market by acquiring ZhaoYin Insurance Brokerage (Beijing) Co., Ltd., and later renamed it to LaoYou Insurance Brokerage Co., Ltd.; and NIO, after completing its acquisition of HuiDing Insurance Brokerage, renamed it to NIO Insurance Brokerage Co., Ltd.

In addition to auto companies, large institutions with channel, scenario, or industrial synergy advantages are also accelerating their deployment. In November 2025, the National Financial Regulatory Administration approved and agreed to allow China Post Group to carry out insurance agency business. Earlier, the relevant companies under Chow Tai Fook had already completed the acquisition of all equity of Zhongjie Insurance Brokerage.

From the overall market performance, the business scale of insurance intermediary channels has not shrunk, and premium income has continued to grow. According to data from 《China Insurance Yearbook 2025》, in 2025, insurance intermediary channels generated premium income of 5.1 trillion yuan, a year-on-year increase of 5.9% on a comparable basis. Of that, premium income from professional intermediary channels was 962.2 billion yuan, up 10.4% year-on-year; and premium income from insurance multi-line agency institutions was 1.74249 trillion yuan, up 4.5% year-on-year.

However, the growth in premium income cannot hide structural differentiation. Zhu Junsheng pointed out that intermediary institutions that still have equity appeal typically have the following characteristics: first, they have stable and sustainable client resources (such as corporate clients or high-net-worth clients); second, they have professional service capabilities (such as risk management or industry solutions); third, they have certain digital capabilities or platform attributes; fourth, they form differentiated advantages in specific segments.

Zhu Junsheng emphasized that overall, as capital enters the insurance intermediary industry, it is shifting from “buying licenses” to “buying capabilities.”

The industry moves toward specialization, centralization, and value creation

With the profit model being reshaped and operating costs rising, insurance intermediary institutions must find new growth drivers. Zhu Junsheng believes the core direction is to shift from “scale expansion” to “value creation.”

On the one hand, intermediary institutions need to move from simply selling products to providing risk management and comprehensive services. For example, in high-growth C-end markets such as retirement and health, by offering professional consulting, risk assessment, and long-term services, they can achieve deeper client management and higher renewal rates.

On the other hand, they should leverage digital tools to improve operational efficiency and reduce client acquisition and service costs, thereby strengthening profitability across cycles.

At the same time, integrating product resources from multiple insurance companies to provide diversified and personalized solution sets can also help form professional barriers to entry.

In addition, strengthening collaborative cooperation with insurance companies, shifting from traditional “channel relationship” to “value co-creation relationship,” will also become an important direction.

In terms of industry structure, Zhu Junsheng expects that as institutions are cleared out and license value becomes more rational, the concentration of the insurance intermediary industry is likely to continue increasing. The exit speed of micro and small institutions will accelerate, and the advantages of leading and professional institutions will be further strengthened. In the long run, the industry will gradually form a tiered structure centered on professional capabilities, client management capabilities, and digital capabilities. Service quality will show differentiation, and the market share and customer stickiness of high-quality institutions will increase significantly.

Going one step further, Zhu Junsheng pointed out that the functional positioning of the intermediary industry is also changing: it is evolving from a traditional policy sales channel toward a “customer management and value creation center.” In the future, it is expected to become an important node connecting insurance companies, health management, retirement services, and technology platforms.

Zhu Junsheng believes that the current adjustments in the insurance intermediary industry are not a simple cyclical fluctuation, but a deep reshaping driven jointly by regulation, the market, and capability structures. In the short term, it is institutional clearing and profit pressure; in the medium to long term, it is the industry’s process of evolving toward specialization, centralization, and value creation. In this process, intermediary institutions that can truly get through the cycle will no longer rely on fee dividends; instead, they will build sustainable long-term value by leveraging clients, capabilities, and services.

(Editor: Qian Xiaorui)

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