A study on the contrast of the quarterly performance of the three insurance stocks

Xu Gaolin/Wen three major insurance stocks 2009 quarterly performance, Chou, Tai Bao and ping an earnings per share of 0.19 yuan, 0.03 yuan and 0.22 yuan, respectively, year-on-year growth of 55.07%, 88.8% and-66.4%, After deducting the non-recurrent profit and loss after the total dilution of net assets yield of 3.68%, 0.4%, 1.9%, basically performance for the best, the worst, peace Center (per share of income is slightly higher because of the end of each share of net worth of safe 10.72 yuan, Chou 5.16 yuan).　　The same insurance market and investment Market, the difference is so big, how to interpret it?　　With the opening of high risk investment channels such as stock market, the determinants of an insurance company's overall operating performance can be divided into three parts: investment performance, underwriting performance and management cost, because the third part of the proportion is not high, so mainly from the investment and underwriting perspective. Account classification mode affects investment performance Table 1 shows that the trading financial assets of the national life of the floating profit and loss from the first quarter of 2008-5.515 billion Yuan rose to 2009 year of the first quarter of the surplus of 841 million yuan, 2009 years a quarterly increase of 6.356 billion yuan. As far as the investment income has been realized, the same time the country life is from 15.099 billion yuan to 11.672 billion yuan, the reason for this fall may be many, such as the investment base change, the fund dividend decline, interest rates fall or cash in the floating surplus decline. Overall, the total impact of the investment is 30.56% per cent growth. In the same period, the net profit of the shareholders of the listed companies rose from 3.474 billion yuan to 5.387 billion yuan, an increase of 1.913 billion yuan and an increase of 55.07%.　　So the investment performance can explain the Chou 2009 quarterly performance of the source. Look at the kingpin again. Its trading financial assets of the floating profit and loss from the first quarter of 2008-416 million Yuan rose to the 2009-year quarter of the floating surplus of 132 million yuan, the increase in profits is only 548 million yuan, while the Realized investment income in the same period has dropped from 6.99 billion yuan to 3.27 billion yuan, and the amount and extent of the decrease are much higher than that of Guo Shou. A 50% drop in investment performance is an important factor in the 90% decline in overall performance.　　In short, in terms of the overall impact of investment on the current profits, Chou is 2.93 billion yuan, while the kingpin is a profit reduction of $3.17 billion.　　The situation is a little special, the investment performance increased by 82.5%, but the shareholder profit is a sharp decline of 66.4%, a huge contrast, mainly because the following will be analyzed under the underwriting data problem. Alone in terms of investment performance, ping An growth of 82.53%, national life growth 30.56%, the kingpin down 48.21%, three insurance companies, the investment performance difference why so big?　　Is it entirely an investment level difference? This has to do with three asset allocation models and accounting standards. Since stocks are the most volatile asset of market capitalisation, and depending on the intent of the purchase, the stock can be placed in the subject of a trading financial asset, or may be sold as a financial asset, in which the transactionThe floating profit and loss of the subject is directly counted into the current profits, while the profit and loss of the sale subject can only affect the current profits when the cash deficit reaches a certain condition.　　The fact that three insurers have a significant difference in the classification of equity investments leads to a very different effect on profits, even if the adjustment rhythms of asset allocation are similar (as we have shown in our analysis of the 2008-year report of the three major insurance stocks). In terms of the impact of accounting accounts, it is not difficult to see from table 2, three insurance companies in the classification of stocks and funds do exist significant differences: safe trading stocks accounted for more than 15%, trading funds around 40%, national life trading stocks of about 6%, the fund around 15%, the Tai Bao's trading shares accounted for less than 0.5%, Fund about 10%. Regardless of the stock or fund, the kingpin into the transaction of the proportion of the subject is the lowest, the highest peace, the State Life Center. Therefore, the floating profit of the Tai Bao stock market investment will not be reflected in the current profits. And the first quarterly bulletin in 2009 on the realization of the sharp reduction in investment income is precisely the interest of investment and trading income reduction, note that here can not say that the sale of the subject of the stock even no profit! In fact, the Tai Bao such a maverick model of the subject of the impact of the profit has two sides: sometimes the reduction of filial piety sometimes magnified.　　For example, 2008 years in the three insurance stocks, the performance of a single show on the benefit of the sale of the subject of the full release of the contribution of the surplus. To sum up, in terms of investment business, the proportion of transaction subjects is lower when the stock market is in a rising period, because the sale of the subject of the float is not included in the current performance and to conceal the effect of the profit; Conversely, when investors fully release the sale of the subject of profit, because the remaining floating losses are not counted into the current profits, and exaggerated profit effect.　　This is the three major insurance stocks in the 2009-year quarterly investment performance is the main reason for the sharp contrast: safe trading assets accounted for the highest and thus the contribution of investment to profit is the largest, the second, the lowest. The "subjective difference" of underwriting business is the main factor that affects insurance company's underwriting performance. The calculation formula of its core index is: the comprehensive compensation rate = (Payout expenses-amortization payout expenses + withdrawal Insurance liability Reserve-amortization Insurance Liability reserve)/earned premium. Because of both subjective and objective factors, the "extraction of insurance liability reserve" is a work which is influenced by the will of the parties: objectively speaking, the subject is influenced by actuarial assumptions, special reserves of dividends and universal smoothing Reserve, which are determined by the parties ' judgment; subjectively speaking,　　Since the determination of the amount of these projects does not have a formula for disclosure or commitment, it is a factor that the parties can "legitimately" determine for some business purposes, although it may be subject to some regulatory or other constraints. Because the artificial liability reserve will be more and less after the later, so the comprehensive compensation rate will erase the parties in the number of the various unintentional subjective, in order to reveal the different companies "subjective differences, we calculate directly the proportion of payments paid and the withdrawal of insurance liability reserves to the current earned premiums (see table 3).　　Empirical data for us to reveal a number of such characteristics: first, the cost of peace payments for the lowest volatility, the average is 26.23%, but the standard deviation is only 3.77%, whether from the standard deviation absolute value or with the ratio of the average is lower than the national longevity and the Tai.　　Second, safe extraction insurance liability reserve fluctuation amplitude, the average value is only 60.4%, standard deviation of up to 31.02%, whether from absolute value or with the ratio of the average is the highest of the three, the specific proportion is between 30%-110%, almost no stability can be said. Third, the three insurance stocks have a total proportion of volatility is lower than the withdrawal of the insurance liability reserve, it is reasonable to note that the ratio of withdrawal of reserves has a relationship with the proportion of compensation expenses, because insurance, apart from dispersing the risk in space (between the different insured), also disperses the risk in time.　　In the past, it should be appropriate to prepare a little more money for future periods. There are abnormal phenomena in the extraction of insurance liability reserve. If it is not obvious from the mean, it is only slightly higher than the Kingpin, then on the standard deviation it is significantly higher than the Tai and Guo Shou. 2007 three quarter accounted for 108.58%, 2008 three quarter and fell to 29.92%, although there is a certain risk of investment funds, its profit and loss is one of the reasons for reserve fluctuations, but it is not enough to explain its huge fluctuation amplitude.　　For example, in the middle of 2007 Ping ' an investment in the insurance account for the security of insurance accounts 31.46 billion yuan, ping an total withdrawal of life insurance liability reserve 40.09 billion yuan, in the middle of 2008 safe investment in the insurance account unit reserves rose to 36.08 billion yuan, the safety of the total withdrawal of the life insurance reserves fell to 15.59 billion yuan　　From the 2009 quarterly situation, Ping An, as a result of the withdrawal of 30.09 billion yuan insurance reserves, more than the same period of 17.75 billion yuan a year ago, so that the increase of 3.53 billion yuan investment income completely swallowed up, resulting in the safe profit not rise and fall. In fact, due to various objective factors and the possible existence of man-made factors, the company's performance in a quarter or even a year is a big fluctuation, to judge the level of insurance companies are very unreliable. Table 4 shows that the average earnings per share and net asset per share of the same period that are often used to determine valuations are more volatile, in particular earnings per share. The index of operating results does not seem to have any steady upward momentum, nor is there a significant trend in the company's continued dominance (the accompanying figures show the characteristics of this "few quarters" of the Warring States). Now, if we look back at the end of 2006, early 2007, when Chou and Ping An were released, the pontificate or predictions of professional reports by analysts or commentators were probably only helpless and sentimental: Not that I don't understand that the world is changing fast. I'm afraid this conclusion applies to listed companies in other industries,The three insurance shares in all listed companies are operating and financial statements are fairly standardized companies.