Even if the regulator is not a contraction of the order as part of the scenery of this year, the most universal insurance is also more difficult to Bengda months.
In fact, as the RMB deposits and loans of the central bank benchmark interest rates will go down the normal reaction, as well as the China Insurance Regulatory Commission in August of "rectification" of meeting a positive response, as a savings alternative to the universal insurance, the industry-wide in August, following a substantial transfer Clearing the low level of interest rates after this month once again lowered the collective.
Clearing interest rates, "Meng landing"?
According to our statistics, in September in addition to 8 life insurers remained level last month, a total of at least 15 insurance companies has been reduced billing rates, including the Sino-British life (Kim litchi B / gold color of life B / Choi-chi life B ), And Pacific Life (and more profitable 2007) related to universal insurance, and its September monthly universal insurance settlement of the year reached an alarming rate reduction of 70 basis points (see table 2).
In addition to universal insurance market has just opened the door to the country's cutting-edge Chinese life (Jinsheng cadenza) universal insurance settlement from the August rate of 5.50 percent (annualized) reduced by 50 basis points to 5.00 percent, the cumulative rate of return of the year 5.4975 percent. And Ping An Life Insurance (gold color of life) in September slightly reduced by 25 basis points to 5.25 percent (annualized).
Table 1 (abbreviated)
Our statistics from the 24's, this month has been a comprehensive settlement rate fell below 5.50 percent, and China Life Insurance (601,628, it shares), Taiping Life, PICC Health, and other companies have already fallen below 5%, Legend has it reached 5% of the horizon. The China Life continued to fall in September although the rate settlement, but the absolute level of interest rates on the settlement, two in a row on the 4.05 percent (annualized) level is the industry's last "third overall."
The only exception is that even in August plummeted 60 basis points to choose the life Masanori (happy life) insurance universal, and its sharp increase in September in the settlement rate by 50 basis points to 5.10 percent. The product launched in March this year in the month, the settlement rate of 5.50 percent, at 70 basis points, rising 6.20 percent to reach and become champions of the month; However, in May once again settled back to the initial level of interest rates.
Savings to replace the loss of effectiveness?
A life insurance actuary, said the central bank to cut interest rates after the insurance settlement of the universal collective interest rate cut, with the volatile financial environment, and most of the early companies to maintain a higher settlement rates are bullish on the accumulated reserve smooth In varying degrees on the release, so the interest rates down sharply, to the interests of the clients is also a reduction in the volatile financial environment at the time of caution.
However, such a self-protectionist measures, the consequences of another, making their own position to save the characteristics of the loss of alternative products.
This is because one of the most simple comparison is that even in the Oct. 30 rate cut, commercial banks, 3-year and 5-year time deposits were still 4.77 percent and 5.13 percent.
These people said that, despite the universal risk of the use of compound interest calculation method will make more than their actual income is much more simple way, but taking into account a number of universal pre-insurance of 5% -9% of the cost of front-end deduction and a declaration of its settlement of the effect of interest rates A deduction.
For example, the Agricultural Bank in the country's counter sales of Chinese life (Jinsheng cadenza), even though since the launch of its cumulative earnings for the year of 5.4975 percent, even in the middle and upper levels of industry, but the initial costs of up to 9.0 percent, well Higher than that of peace, peace, and other companies 4% -5% of the cost of the initial level.
And another with a similar product, it is assured that Taikang Life Financial classic version of the same initial cost as much as 9.0 percent. According to our statistics, since the end of 2007 the accumulated years of settlement rate reached 5.8231%, the highest level of the industry.
"The initial cost of universal insurance is the customer directly to the principal amount of investment deduction in the same case, the higher initial cost, the lower the actual return on investment." He said, "From this point of view, it is necessary to maintain product market competition , The high initial cost of the product must have a high level of interest rates match the settlement. "
According to our observation, at least in the past year is, the vast majority of universal insurance billing rates are pegged to the 5-year after-tax bank deposit interest rates, "in part because the company did a good investment, or the high initial cost Will be higher, such as pegging or more than the same period of time pre-tax interest rates. "He said," This is the last (Paul Silver) universal risk of the most important selling point. "
However, our statistics show that in September all 24 universal life insurance company insurance settlement rate for the month to its highest level in three weeks Airlines 5.30% (of years), only to cut interest rates after the 5-year deposits of high interest rates 17 basis points; The lowest on Health Radio, Film and Television for only 3.90 percent, 123 basis points lower than the former.
"This means that the month of view from the universal basic insurance does not have been there to save the value of alternatives." He said.
However, one can say that even the present-the truth is that the high level of pre-clearing interest rates, as well as the cumulative effect of compound interest, in the above-mentioned 24 life insurance companies, there are still 16 December 2007 since the years of accumulated earnings higher than Current 5-year time deposit interest rates 5.13% level (see Table 5).
Not looking the other reality is that, as well as cut the capital market downturn of the double attack factors, the universal settlement has been the general trend of decline in interest rates. "The passage rate cut, universal insurance joint down the effect of actually mean better in the relatively high interest rates on bank deposits to buy on a regular basis." These sources said.
He said that universal insurance in addition to the special nature of its interest-bearing every day, year after year compound interest, the largest of its monthly publication that is characteristic of a rate settlement, and declared by the settlement rate for sub-terms, "This is designed to investors In the interest rate increase cycle, savings deposits to avoid the risk of rising interest rates, which is universal insurance in the past year or so sell in particular the main reason. "
However, the opposite effect is the same sub-bearing interest rates coupled with the settlement of the joint down, "unless there is a lot of special smoothing reserve for the settlement of investment income or interest rates so high support, or certainly not as time deposits."
Investment "charge" debt
Insiders said the security risk at the end of universal mechanism, leading to the main subject of the basic investment for the bonds, although the period of the previous bull market did not rule out the possibility that part of the enlarged company stock investment ratio, but today's market conditions, the near-universal insurance rights and interests from all categories Assets on the retreat, and all bets large deposit agreement, bond-type varieties of fixed-income category.
Access to Information shows that so far this year, has issued 30 corporate bonds and 13 corporate bonds, the size of the issue were 69,750,000,000 yuan and 23,200,000,000 yuan. Only one month in August alone amounted to 46,800,000,000 yuan of the total of 18 corporate bonds and corporate debt issuance, even in one week alone amounted to 12.3 billion of 5 companies to issue debt at the same time.
From September 10 this year, Shanghai's index of treasury bonds for 7 trading days up in afternoon trading day after the sharp increase to 114.80 points at an all-time high, on the day to close at 114.69 points. It is understood that this is the bond index for 6 trading days to a record high. To enter in October, the bond market although there are short-term shocks callback, but it seems as a whole is still a thriving.
Against this background, research fellow at Shenyin Wanguo Quqing believe that the present "Indebted new play" has become a hot investment, showing a year "to fight new" market. Lu Mayi bond analysts said this round of bond bull market can last until the fourth quarter. At the same time, that the current bond investments should be expected to yield annual interest of 5% -15%.
Fengshengshuiqi the bond market, if the universal account also invest in high-yield varieties of the bond market bonds, convertible bonds, and so on, then the real return on investment may be as the round of the bond market, "Mavericks" and a corresponding rise in prices.
However, Qu Qing said that the company can not ignore the debt, corporate debt volatility. In September to 08 in the grain market debt, listing a two-day yield fell 60bp, net income for 5% of the net in the purchase of high-yield is 85%, can be seen as bonds and stocks into a high - Fluctuations in the trading of high-yield varieties. At the same time, credit risk, liquidity risk and market risk of such bonds can not be ignored are the potential risks.
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