The year 2025 proved to be a landmark period for China’s insurance asset management industry, which staged a remarkable comeback defined by a powerful synergy of strategic market expansion, decisive policy intervention, and exceptionally strong investment performance. After a period of declining equity allocations, the sector experienced a profound rejuvenation, driven by three core pillars of success. A significant increase in market participants, notably through the entry of wholly foreign-owned firms, deepened the competitive landscape. Concurrently, a robust and targeted policy framework successfully steered insurance capital back into the equity market. The result was a year of outstanding returns across the vast majority of insurance asset management products, collectively reversing previous downturns and setting a new benchmark for performance and strategic repositioning in one of the world’s most critical financial markets.
A Wave of Internationalization Deepens the Market
A key structural development in 2025 was the tangible expansion of the insurance asset management landscape, which grew to include 36 licensed companies after regulators approved two new entities to commence operations. This expansion was particularly significant as both new entrants, AIA Insurance Asset Management Co., Ltd. and Holland Global Insurance Asset Management Co., Ltd., are wholly foreign-owned, signaling a major leap forward in the internationalization of China’s financial sector. On the final day of 2025, the Shanghai Financial Regulatory Bureau granted final approval for both firms to begin their business activities. AIA Insurance Asset Management was established with a registered capital of 100 million yuan, wholly owned by its parent, AIA Life Insurance. Holland Global launched with a more substantial registered capital of 250 million yuan, fully backed by the Dutch Global Life Insurance Group. Their entry introduced fresh capital and global expertise into the domestic market.
The approval of these foreign-backed asset managers carried multifaceted significance that resonated throughout the industry and beyond. According to industry experts, this development served as a powerful testament to the long-term investment commitment of foreign capital to the Chinese economy, reinforcing confidence in the market’s stability and growth prospects. Furthermore, it directly reflected the tangible success of China’s ongoing policy of high-level financial sector opening-up, demonstrating a genuine commitment to creating a more inclusive and globally integrated financial ecosystem. This move also enhanced the growing attractiveness and influence of Shanghai as a premier international financial center, proving its capacity to attract and retain top-tier global institutions. The addition of these companies not only diversified the competitive environment but was also expected to introduce advanced international management practices and innovative investment strategies into the domestic market.
Proactive Policies Steer Capital Towards Equities
The year was largely defined by a concerted and proactive policy push from government departments to facilitate and guide the entry of long-term insurance funds into the domestic stock market. Recognizing this capital as a crucial source of stable, long-term funding, authorities issued a total of six major policy directives strategically concentrated in three principal directions. The most direct of these thrusts was aimed squarely at increasing the proportion and stability of commercial insurance fund investments in A-shares. A key proposal from the China Securities Regulatory Commission called for large state-owned insurance companies to begin allocating a significant 30% of their new annual premiums toward A-share investments starting from 2025. This was powerfully supported by a fundamental reform of the performance evaluation system for these insurers, which shifted the focus to a long-term assessment cycle of more than three years to reduce pressure for short-term gains and foster a more patient investment horizon.
Complementing this primary directive, policymakers pursued two other strategic avenues to bolster equity investment from the insurance sector. The first involved a significant expansion of the pilot program for long-term insurance fund investments. In 2025, three new batches of pilots were launched, bringing the total pilot investment amount to a substantial 222 billion yuan. This initiative provided a structured and well-regulated channel for deploying more insurance capital into long-term, strategic assets that align with the nation’s economic goals. The second area of focus was the optimization of existing regulatory rules to make equity investment more financially appealing. A notable example was the decision to reduce the risk factors associated with stock investments by an additional 10%. This technical but highly impactful adjustment effectively lowered the capital charges for insurers holding equities, thereby freeing up more capacity for such investments and creating a stronger incentive to increase their market exposure.
A Resounding Rebound in Allocations and Returns
The comprehensive policy measures enacted throughout 2025 had a clear and demonstrable guiding effect on the asset allocation strategies of insurance companies. After a two-year period of steady decline, the proportion of equity assets within insurers’ total fund utilization portfolios saw a strong and decisive rebound. According to official statistics, this ratio rose to 22.5% by the end of the third quarter of 2025, successfully restoring it to the level observed at the end of 2022. This resurgence was fueled by a massive increase in the absolute scale of equity assets held by insurers, which grew by an impressive 2.7 trillion yuan between the end of 2022 and the third quarter of 2025. A remarkable 1.9 trillion yuan of this growth occurred within the first three quarters of 2025 alone, directly coinciding with the implementation of the new, encouraging policies. This swift and substantial shift underscored the market’s responsiveness to the new regulatory environment.
This strategic pivot back into equities paid off handsomely, as insurance asset management products delivered what was described across the industry as an “outstanding” performance in 2025. Benefiting from a strong domestic stock market and the emergence of structural market opportunities, an overwhelming majority—over 90%—of the 1,637 products with available performance data achieved positive returns for the year. A detailed breakdown revealed that direct stock investments were the primary engine of this growth, accounting for 1.2 trillion yuan of the 1.9 trillion yuan increase in equity assets. At the pinnacle of this success was the “ICBC AXA Cyclical Growth No. 1,” an equity-based product that secured the top spot with a remarkable annualized return of 115.37%. This was not an isolated case, as other products from firms like Everbright Yongming Asset and Sunshine Asset also recorded year-to-date returns exceeding 90%, demonstrating widespread success across the sector.
The Triumph of Strategic Investment Themes
The exceptional results of 2025 were ultimately driven by the successful execution of specific investment strategies that aligned with the year’s dominant market themes. An analysis of the top-performing products revealed a clear pattern, with keywords such as “cyclical growth,” “specialized innovation,” “technological innovation,” “advanced manufacturing,” and “dividend value” appearing frequently in their names and mandates. This indicated that the most successful insurance asset management institutions were those that effectively capitalized on key economic cycles and pivotal industrial trends. They concentrated their investments in high-end manufacturing, disruptive technological innovation, and high-dividend value sectors to achieve their substantial returns. This strategic focus proved to be the winning formula in a market environment shaped by supportive policies and resurgent investor confidence, showcasing a sophisticated approach to asset allocation that went beyond simple market timing.
Among management companies, Sunshine Asset Management Co., Ltd. distinguished itself with a particularly strong showing, as multiple products under its management, including Innovative Growth and Industry Flexible Allocation, ranked at the top of the performance lists. This demonstrated the firm’s comprehensive and well-balanced equity investment capabilities in navigating the favorable new landscape. Other large, established institutions such as Taikang Asset Management, China Pacific Asset Management, and Ping An Asset Management also had numerous products that ranked highly, affirming their strong market positions and expertise. The year’s success was therefore not an accident but a direct outcome of a strategic convergence: proactive government policy created the opportunity, and astute asset managers seized it by channeling capital into the most promising sectors of China’s evolving economy.
