Pre-tax Profit Near 4000 Hundred Million in First Three Quarters
The FSC released the latest insurance industry profit data, with pre-tax profit for the first 9 months of this year at 3977 hundred million yuan, on an IFRS 17 accounting basis. In the same period last year, calculated under IFRS 4, it was 1177 hundred million yuan. Insurance Bureau Deputy Director-General Cai Huoyan said that due to the different accounting bases in the two years, the reasons for profit changes are difficult to compare directly.
Of this, life insurers' pre-tax profit for the first 9 months was 3523 hundred million yuan, mainly due to an insurance service result of 1580 hundred million yuan, a financial result of 2676 hundred million yuan, and other operating results of negative 144 hundred million yuan. On a single-month basis, life insurers' pre-tax profit in September was 139 hundred million yuan, consisting of an insurance service result of 187 hundred million yuan, a financial result of 38 hundred million yuan, and other operating results of negative 98 hundred million yuan.
Non-life insurers' pre-tax profit for the first 9 months of this year was 454 hundred million yuan, mainly from an insurance service result of 336 hundred million yuan, a financial result of 162 hundred million yuan, and other operating results of negative 72 hundred million yuan. On a single-month basis, non-life insurers' pre-tax profit in September was 41 hundred million yuan, mainly consisting of an insurance service result of 40 hundred million yuan, a financial result of 9 hundred million yuan, and other operating results of negative 9 hundred million yuan.
Life Insurance Net Worth 4.4 Trillion, Up 440 Hundred Million in Single Month
In terms of net worth, life insurers' net worth at the end of September was 4 trillion 4428 hundred million yuan, on an IFRS 17 accounting basis, compared with 2 trillion 6450 hundred million yuan in the same period last year on an IFRS 4 basis. Cai Huoyan said the difference between the two years was due to remeasurement of insurance contract liabilities, redesignation of financial assets, and accumulation of profits over the past year in net worth.
On a single-month basis, life insurers' net worth in September increased by 440 hundred million yuan from the previous month, mainly due to an increase of 129 hundred million yuan in single-month pre-tax profit, an increase of 158 hundred million yuan in other comprehensive income, and a capital increase of 160 hundred million yuan by Mercuries Life Insurance.
Four Buckets Total 1.1 Trillion, Can Cushion 11.9% Appreciation
Regarding the foreign exchange valuation reserve, the NT dollar exchange rate against the US dollar in September depreciated 1.3% from the end of 2025, with the accumulated balance of life insurers' FX reserve at 7458 hundred million yuan, an increase of 1321 hundred million yuan from the end of last year. At the end of September, the combined impact of exchange gains/losses, hedging gains/losses, and net changes in FX reserve for life insurance was negative 2046 hundred million yuan.
On a single-month basis, the NT dollar exchange rate against the US dollar at the end of September was 31.85 yuan, a depreciation of 0.58% from the end of August, with the overall life insurance FX hedging ratio falling to 40.95%. Among FX hedging positions, FX swap transactions accounted for slightly more than 75%, while non-deliverable forward transactions accounted for slightly less than 25%.
In February this year, the FSC amended the Directions for Foreign Exchange Valuation Reserve for life insurance companies, expanding the framework into four buckets: volatility reserve and fixed reserve under liabilities and equity for foreign exchange valuation reserve, and fixed foreign exchange risk reserve and enhanced foreign exchange risk reserve under special surplus reserve. At the end of September, the volatility reserve was 6584 hundred million yuan, the fixed reserve was 874 hundred million yuan, and the special surplus reserve was 3651 hundred million yuan, including 3651 hundred million yuan in fixed foreign exchange risk reserve and 0 yuan in enhanced foreign exchange risk reserve, totaling 1 trillion 1109 hundred million yuan. Cai Huoyan noted that at the end of September, life insurers' net exposure in foreign investments was 9 trillion 3286 hundred million yuan, and in an extreme scenario where all foreign investments were repatriated, it could cushion about 11.9% NT dollar appreciation, calculated at 31.85 yuan about 3.8 yuan, defending against NT dollar appreciation to 28.05 yuan.