"The last bus with a lifetime interest rate of 3% will never be missed!" "Here comes 2.5%, goodbye, 3%" "The scheduled interest rate of 3% is almost unbearable, and you can make money if you buy it now!"...... June 13, Beijing Business Daily The reporter noticed that the insurance agent launched a new round of "hunger marketing", which undoubtedly signaled that the products with a predetermined interest rate of 3% would be taken off the shelves soon.
In fact, the news that the 3% increase in life insurance of insurance companies will stop selling at the end of June has been heard frequently in the market recently. On June 13, a reporter from the Beijing Business Daily learned from the industry that there is no unified time point for the products to be taken off the shelves at present. For most insurance companies, the 2.75% increased life insurance of "taking over" is in the preparation stage.
Last year, the curtain call for products with a predetermined interest rate of more than 3% was finally staged at the end of July. After the predetermined interest rate was lowered to 3% last year, this year it was again lowered. What signals were released? With the shift cycle of the product approaching, where will the increased life insurance go?
The predetermined interest rate will face a new round of major adjustment
Against the background of further decline in interest rates, the market generally predicts that the predetermined interest rate of the insurance industry may continue to decline. Now, the downward trend has been actually reflected. A notice from a life insurance company circulating on the Internet shows that the company will stop selling a 3% increased life insurance throughout the system from 24:00 on the 30th of this month.
So, have other insurance companies made clear the schedule for the removal of life insurance with 3% interest rate increase? The reporter of Beijing Business Daily interviewed several insurance companies based on this, and some insurance companies said that they were indeed ready to stop selling 3% of the increased life insurance, and 2.75% of the increased life insurance was expected to go on sale next month.
Some insurance companies also said that their 3% increased life insurance has not been stopped selling, and there is no off shelf schedule. When the predetermined interest rate drops from 3% to 2.75%, there is generally no notice from the regulatory documents, for example, there is no clear notice of the time node when the sales of 3% increased life insurance are not allowed. However, at present, insurance companies should be preparing 2.75% increased life insurance products. On the whole, although the situation of each company is different, the overall law is similar. It is increasingly difficult to pass the 3% increased lifetime life insurance report, and products with 2.75% or even lower predetermined interest rate are naturally "ready".
Since last April, the reduction of the scheduled interest rate of life insurance has once again become a hot topic in the life insurance industry. The drama of products with a scheduled interest rate of more than 3% came to an end at the end of July last year.
"The change of the predetermined interest rate in China's insurance industry can be roughly divided into four stages," said Wu Zhongyan, a researcher at the China Institute of Local Finance. First, the predetermined interest rate was unlimited before 1999. Before 1996, the fixed deposit interest rate of banks could reach 10.98% at most. In order to compete with banks, insurance companies launched many products with higher predetermined interest rates, usually between 8% and 10%. Second, from 1999 to 2013, the predetermined interest rate did not exceed 2.5%. Third, from 2013 to the end of 2019, the predetermined interest rates are 3.5% and 4.025%. Fourth, in 2019, the annuity insurance products with a predetermined interest rate of 4.025% were "suspended", and since the first half of last year, the regulatory authorities have given window guidance to relevant insurance companies, and the pricing interest rate of newly developed products has been lowered from 3.5% to 3%.
As for the expected time of the product shift tide, some insiders said that according to the current "signs", some insurance companies are expected to gradually prepare 2.75% increased lifetime life insurance products in the near future. All kinds of signs indicate that the product shift tide is expected to be staged this year.
"Change" in the market or change the strategy of insurance companies
The decline of the predetermined interest rate has become a major trend because life insurance companies have to deal with certain risks.
In Wu Zhongyan's opinion, the spread loss is closely related to the setting of the predetermined interest rate. The so-called predetermined interest rate refers to the annual rate of return assumed by the insurance company for the policy based on the company's prediction of the future rate of return on the use of funds when pricing products. It refers to the rate of return provided by the insurance company to consumers, which is mainly set by reference to the bank deposit interest rate and the expected rate of return on investment. In the development of life insurance products, a predetermined interest rate is set and the policy benefits are agreed. Insurance companies use insurance funds for investment. Against the background of a downward trend in bank interest rates, the expected investment income of insurance companies may be affected. If the expected investment income deteriorates, the money earned by insurance institutions may not be enough to support the agreed benefits of the policy, thus forming interest spread losses.
"With the decline of the market interest rate, the adjustment of the predetermined interest rate of insurance is inevitable." Zhi Peiyuan, the enterprise tutor of the master students in the School of Management of China University of Mining and Technology (Beijing), said that under the low market interest rate environment, insurance companies are facing the pressure of matching assets and liabilities, so they need to adjust the predetermined interest rate to adapt to market changes.
It is not difficult to find that, on the one hand, insurance companies need to take into account the company's cost of capital, risk tolerance and future earnings expectations when formulating predetermined interest rates; On the other hand, the adjustment of the predetermined interest rate reflects the expectation of the insurance company for the future market environment and the adjustment of its own financial strategy.
In the long run, the reduction of the predetermined interest rate may reshape the competitive pattern of the insurance industry. Zhi Peiyuan further analyzed that some companies may attract customers by optimizing product design and service quality, while others may face a decline in market share. In addition, insurance companies may need to adjust their sales strategies to adapt to the new predetermined interest rate environment. For example, the company may strengthen the education of consumers and emphasize the long-term protection value of insurance products, rather than just short-term investment returns.
So, what is the impact of lowering the predetermined interest rate on the policyholders? Wu Zhongyan said that the predetermined interest rate is one of the key factors in the pricing of life insurance products. When other factors remain unchanged, the decrease of the predetermined interest rate means that the product price will rise and consumer income will decrease. However, the debt cost of insurance companies will also decrease.
On the whole, the dynamic adjustment of the insurance interest rate is the result of changes in the market environment and regulatory policy adjustments. Zhi Peiyuan believed that insurance companies should pay close attention to market changes, flexibly adjust product strategies, and strengthen risk management to ensure long-term stable development of the company. For consumers, when choosing insurance products, they should fully consider the product's security function, cost structure and investment income to achieve their personal financial goals. In addition, regulators should continue to play a guiding role to ensure the healthy and stable development of the insurance market.
As for how consumers should view the adjustment of predetermined interest rate, Wu Zhongyan said that obtaining security is the main purpose of purchasing insurance. Compared with short-term financial management, insurance is a long-term asset planning. When purchasing insurance, we should pay more attention to the long-term income. It is not advisable to make a one-sided simple comparison between insurance products and bank deposits, national debt, funds and other financial products, nor to blindly believe that only emphasizing "high income", promising to guarantee income and other false propaganda behaviors.
Beijing Business Daily reporter Hu Yongxin
