Thank you for standing by for Fanhua Fourth Q uarter and Fiscal Year 2021 Earnings Conference Call. At this time, all participants are in a listen-only mode. All lines have been placed on mute to prevent any background noise. After the management's prepared remarks, there will be a question-and-answer session. Please follow the instructions given at that time if you would like to ask a question. For your information, this conference call is now being broadcast live over the internet. Webcast replay will be available within three hours after the conference is finished.
Please visit Fanhua's IR website at ir.fanhuaholdings.com under the Event and Webcast section. Today's conference is being recorded. If you have any objections, you may disconnect at this time. I would now like to turn the meeting over to your host for today's conference, Ms. Oasis Qiu, Fanhua's Investor Relations Manager.
Good morning and good evening. Welcome to our Fourth Quarter and Fiscal Year 2021 Earnings Conference Call. The earnings results were released earlier today and are available on our IR website as well as on Newswire. Before we continue, please know that the discussion today will contain forward-looking statements made under the safe harbor provisions of the US Private Securities Litigation Reform Act of 1995. The accuracy of the statements may be impacted by a number of business risks and uncertainties that could cause our actual results to differ materially from those projected or anticipated.
Such risks and uncertainties include, but not limited to, those outlined in our filings with the SEC, including our registration statement on Form 20-F. We do not undertake any obligation to update this forward-looking information except as required under applicable law.
Joining us today are our Chairman and Chief Executive Officer, Mr. Yinan Hu, Chairman and Chief Executive Officer, Mr. Peng Ge, Chief Financial Officer. Mr. Hu will provide a review of financial and operational highlights in the fourth quarter and fiscal year 2021. There will be a Q&A session after the prepared remarks. Now I will turn the call over to Mr. Hu.
大家好，我是胡翼楠。非常感谢大家参加今天的汇报会议。我想先谈谈我对行业的现状和未来发展趋势的一些看法，再谈谈泛华2022年的经营思路和重点工作。
Good morning and good evening. This is Yinan Hu. Thank you for joining today's conference call. I would like to begin the call by sharing some of my thoughts on current industry trends. I will discuss our strategic focuses in 2022.
2021年，中国寿险行业保费规模整体呈现高开低走的态势。新旧重疾新规定义切换后，年初至今保费增速持续下行，全年的寿险总保费规模呈现这个负增长。疫情反复的影响，监管趋严固然是原因之一，但我认为，供需侧无论是产品还是销售队伍的专业能力均未能满足客户的真实需求，才是主要的原因。
In 2021, China's life insurance industry started off well but ended up on a downward track. Premium growth continued to slow down after the transition to the new Critical Illness definition framework in the first quarter of 2021 and gross written premiums, or GWP, dropped year-over-year. The resurgences of COVID-19 and tightened restrictions and regulations clearly played a role, but we believed the major cause lies in the supply side, as neither the quality of insurance products nor the professional capabilities of insurance sales agents can fully meet customer needs.
在保险行业的转型期，机会与挑战并存。2022年，中国进入退休年龄的人群将从2021年约九百万人大幅增长至两千五百万人。未来十年，每年都有超过两千五百万人步入退休的行列，累计近三亿人。随着中国老龄化趋势的不断加快，养老、资产保全、税务规划和资产传承将成为此类人群的主要需求。与此同时，从成熟市场的经验来看，随着中产阶级的崛起和居民收入水平的提高，居民对于保险的定位也会逐渐从满足基本保障为主，升级为综合的家庭资产配置的方式。中国保险行业将迎来养老传承需求驱动的大风口和家庭资产配置的大时代，而这将需要更高素质、更专业的销售人员来满足。
Against the backdrop of industry transformation, despite mounting challenges, we also see tremendous opportunities. In 2022, people reaching the retirement age are expected to grow from 9 million in 2021 to 25 million in China. More than 25 million people are expected to retire in the next 10 years each year starting from 2022, adding up to 300 million people. With an accelerating aging society, there is burgeoning demand for elderly care, asset preservation, tax planning and legacy management among soon to be retirees.
Meanwhile, based on experience learned from mature markets with the rise of the middle class and the increase in consumers disposal income, more and more people are shifting their demand for insurance from ensuring basic protection to more comprehensive plans for family-based asset allocation. These changing consumer demands are driving the next era of strong growth, but such demands require salespeople to be equipped with higher capabilities and more professional knowledge.
从过去几年行业和泛华的数据也印证了这个趋势。
Statistics from both the industry and Fanhua in the last few years also confirm this trend.
从保费结构来看，2021年的重疾新规以来，行业重疾险的销售遭遇了持续的滑坡。对于泛华而言也是如此。过去一年重疾险新规带来的新单规模总体呈逐季下降的趋势。去年的第一季度录得一个最高峰，然后第二、第三、第四就持续地下降。取而代之的是终身寿及年金险、储蓄类保险产品的销售呈总体上升的趋势，这正反映了保险需求的转变。
From the premium mix perspective, critical illness sales have suffered a continuous decline after the transition of CI definition framework. The same applies to Fanhua. For 2021, critical illness sales facilitated on Fanhua's platforms have dropped quarter by quarter, showing a downward trend in general, while those sales of savings-type products such as whole life insurance and annuity have been on the rise instead, clearly reflecting the changes in insurance demand.
从代理人的视角来看，过去一年中国保险行业的代理人总数从九百万人大幅跌落到六百万人。代理人队伍呈现两极分化，一方面是大批的低产能的代理人从行业脱落，另一方面高产能的人力队伍更加稳定，产能持续上升。从泛华自身来看，尽管泛华总代理人数和总出单人力持续下滑，但泛华的年度新单保费十万及以上的级优代理人人数从2018年的3,230人增长到2021年的5,432人，总体呈明显的增长趋势。级优代理人的产能也保持平稳逐年的增长，从2018年的年均二十五万的保费增长到2021年的人均三十二万的保费。说明代理人的队伍在分化，但公司主力销售队伍稳定，队伍质量在提升。
To take a look at agents. The total number of agents across China's insurance industry has plummeted from 9 to 6 million, leaving a polarized sales force. As on the one hand, a large number of low-performing agents are leaving the industry, and on the other hand, high performing salespeople are more stable and productive.
From Fanhua's standpoint, despite a fall in Fanhua's total numbers of agents and performing agents, the last four years witnessed an increase in the number of Fanhua's high-performing agents, with annual first year premiums of RMB 100,000 and above. From 3,232 in 2018 to 5,432 in 2021, suggesting a distinctly growing momentum in general.
Productivity of our high-performing agents has also grown year by year as their per capita average annual premiums grew from RMB 250,000 in 2018 to RMB 320,000 in 2021. All this indicates that our agents are also diversifying, with Fanhua's core sales force remaining stable and growing in quality.
从客户层面，2018年以来，公司年交保费十万以上的高保费的客户数量也在呈现明显的增长的趋势，每年新增的高客在持续增加。每年旧客户的复购贡献保费也呈现增长的趋势，复购率占比超过30%。客户持续质量提高，从侧面说明了中产阶级在迅速崛起，崛起高净值的客户数量在不断增加。
As for customers, the number of Fanhua high premium customers with over RMB 100,000 annual payments has also shown a distinctly upward momentum as the number of new high premium customers each year has been growing and the premiums contributed by repeated purchases have been increasing accounted for more than 30% of the total. This suggests that the middle class has been rising rapidly and the number of high net worth customers has been increasing as well.
2021年，相比行业人身险总保费下滑0.3%，泛华总保费实现规模115.8亿，同比增长了12.3%。新单保费28.3亿，同比增长了4.1%，其中终身寿新单保费同比增长超过64%，再次印证了客户需求的转变以及高级优高产能人力对业务增长的贡献。代理人的质量的增长抵消了数量的下滑，这也为泛华指明了未来的经营方向。
In 2021, despite a drop of 0.3% in the industry life insurance GWP, Fanhua managed to register CNY 11.6 billion of total GWP, a year-over-year increase of 12.3%. First year premiums reached CNY 2.8 billion, a year-over-year increase of 4.1%, among which first year premiums of whole life insurance grew by over 64% year-over-year.
This again confirms the changes in customer demand and the contribution of highly productive, high performing sales force to business growth, as well as the fact that the quality improvement of agents are able to offset the adverse impact of downsizing, and it also sheds light on Fanhua's future path for development.
我在这里就是再补充两个数据，就是从2021年的十万批的，十万新增保费的客户的贡献占到我们全年的这个34%，而十万批就十万的这个保费销售的代理人的贡献，五千多人占到了我们总保费的65%。
The two data that further confirm this trend. First, a high performing high premium customers with annual premiums of over RMB 100,000 annual premiums contributed roughly 34% of our total first year premiums in 2021. The number of agents who contributed over RMB 100,000 first year premiums in 2021 amounted to about 5,000 of them contributed around 65% of our total first year premiums.
基于对行业未来趋势的判断，泛华二零二一年全面实施职业化、数字化和开放平台的新战略，致力于全方位的赋能和培育专业化人才，赋能行业，以迎接养老传承的大风口。二零二二年，泛华将深入推进职业化、数字化开放平台的发展战略，主要聚焦三项工作。
Based on our judgment on the industry, Fanhua implemented in full strength the new strategy of Professionalism, Digitalization, and Open Platform in 2021 in an attempt to fully empower and cultivate professional talent and also empower the industry to take full advantage of the great opportunities brought by the rising demand for elderly care and family legacy management. In 2022, we will further execute the development strategy of Professionalism, Digitalization, and Open Platform with a focus on the following initiatives.
第一，借助保险金信托和家族信托服务，拉动高净值客户经营，满足高净值客户的传承需求。力争完成不低于一千个家庭的传承的大额保单，年缴保费不低于十万的客户的保费贡献同比增长30%。这也是基于我们前面的分析，我们看到就是高客的贡献逐渐在整个保费的贡献中的占比不断在提升。所以我们首先聚焦高端客户的需求，而聚焦高端客户的需求的着力点，我们着力在这些客户的传承的需求上。
We plan to tap into high net worth market by offering referral of insurance, trust and family trust services with a target to complete over 1,000 large ticket family legacy management policies and increase the amount of premiums contributed by high value customers who would pay no less than RMB 100,000 premiums annually by 30%.
This is made based on previous judgment on the industry, and we believe that the contribution of high value customers is on the rise so that we pay our first focus on high value customers demands. Our point here is to make sure to meet their demand for family legacy management first.
第二个方面是基于我们的数据，十万批的代理人的贡献，保费的贡献占到了我们总保费的65%。所以我们认为2022年我们一个很重要的一项聚焦的工作，就是关注、培优、增优。通过专业赋能，提供公司客户资源等等，以及数字化赋能，推动2022年现有队伍及泛华云同实现年度十万批产值，十万批的这个代理人的产值增长30%的目标。
Second, high-performing agents with RMB 100,000 FYP contribute about 65% of the total FYP in Fanhua. We will focus on fostering and recruiting more productive agents through professional empowerment, customer resources offering and digital empowerment to meet the target of 30% growth in first year premiums contributed by high-performing agents with RMB 100,000 FYP within our existing sales force and Fanhua Yuntong.
借助互联网保险新规的政策东风，加快推进开放平台战略，以实现开放平台业务贡献率占新单保费的几众，在2022年达到10%以上。
Three, we expect to accelerate the advancement of the Open Platform strategy benefiting from the favorable environment after the Internet Insurance New Regulations took effect through which we look to achieve the targets of generating 10% of our first year premiums in 2022.
我们的目标是用未来的两年的时间，将泛华打造成为一家全新的公司，一家数字化、专业化、高增长的公司。2022年是我们的能力建设年。我们相信2022年的基础建设将带来飞轮效应，带领公司从2023年重归盈利，持续高增长的轨道。
Our goal is to transform 泛华 into a brand new, digitalized and specialized company that demonstrates high growth in the next two years. 2022 will be a year of capacity building, laying the groundwork for 泛华 to get back on track for sustained and high profit growth.
下面我们来回答大家的提问。谢谢。
This concludes my presentation, and now the floor will open for your questions. Thank you.
Our first question comes from Suzanne Wang of CICC. Your line is open.
好，那个管理层早上好，谢谢管理层给我这个提问的机会。首先是恭喜这个公司在Q4取得了一个非常不错的业绩。然后我这边有两个问题想要请教的。第一个问题其实是关于咱们这个互联网人身险新规啊，它这个落地之后呢，其实很多中小险其实没有办法在线上开展业务的，那我们作为一个最大的一个线下的一个经纪公司，我们现在有没有看到说他们跟我们的这个合作意愿变强了？如果有的话呢，会不会对我们这个2022年的这个业绩展望有一定的这个影响。那第二个问题是关于产品啊，就是公司也提到了2021年是储蓄型产品表现非常亮眼，那想请教一下管理层的这个视角看，这个是一个短期的一个风格的切换，还是说是我们这个市场的保障需求其实已经到顶了呢？那我们后续打算如何继续发力这个储蓄型的产品？然后还有关于就是这个佣金，那储蓄型产品对于我们这边的佣金和这个保障型产品相比，大致是一个什么样的水平呢？然后我简单翻译一下，问这两个问题吧。
Uh, first congrats to the impressive results of management in fourth quarter. I have two questions. First, after the new regulations of Internet insurance, so many small and medium-sized insurance companies cannot do online business. Can we see stronger willingness for them to cooperate with us? Will it affect our 2022 performance outlook? Next one is about the product. We can see a rapid growth in the savings-type product.
Do we think this a short-term adjustment or it is due to that the demand for protection product has peaked? How could we do better in savings-type products? Is the commission rate of savings-type sharply lower than that of the protection type? Thanks.
关于第一个问题，我们确实看到了中小保险公司对我们的合作的意愿，以及新产品的研发等等这一方面都表现出强烈的积极的态势。我们认为互联网新规对于公司的发展是积极正面的。而且我们看到的就是线上和线下的打通，特别是很多线上的业务开始，对我们这个开放平台的需求有非常明显的强烈的愿望。我们的开放平台从去年开始建设，去年一共做了四千万的保费，预计我们今年第一季度大概就做了三四千万的保费。我们预计到今年下来，就是开放平台这个业务，就是线上和线下接通的这个业务，会达到三亿到五亿的保费规模。所以我们觉得这个也是对我们非常利好的。
Concerning your first question regarding the impact of the internet life insurance regulations. We do observe that a lot of small and medium-sized insurance company have more positive attitudes towards cooperating with us, as well as designing new products. We believe that this new regulation is positive to our business development in general. In addition to that, we are observing that the integration between online and offline business has also shown a significant progress.
After the new regulations, a lot of online channels and who used to distribute their business through internet channels are willing to pursue cooperation with our Open Platform business as well. Last year, we have generated about CNY 40 million first-year premiums through our Open Platform strategy. This quarter, in the first quarter, we have already achieved about CNY 30 million first year premium. Our target for 2022 is to deliver about CNY 300 to 500 million first year premium. In conclusion, we believe that this new regulation is definitely quite favorable to our development.
关于第二个问题，就是产品结构。产品结构从年度来看，2021年比2022年，我们的这个终身寿、重疾和年金险的这个占比，其实是有非常大的一个结构变化。在2020年这个重疾险是占到了这个……不对吧，这个应该是30%、30%、39%、38%、14%。
是季度保费规模。
对，我们看的就是从2021年我们的四个季度，四个季度来看，就是在第一个季度，我们的这个重疾险的占比是达到了，从保费规模来看，是...
到这个大概，对，保费规模。然后我记得就是到第四季度的时候，我们的年，终身寿和年金险是达到了70%，百分之二十多是重疾险。那么但是在年初，就是在第一个季度，已经在上一年，其实这个终身寿的这个保费是低于重疾险的。这就意味着就是看到这个产品结构确实发生了一个非常重大的变化。在第二季度，其实去年第二季度、第三季度都反映出，就是重疾险，这个终身寿和年金是大大超过了这个重疾险的这个保费的。那么这个占比，这个结果，我认为是一个市场需求的真实反映，这反映了市场需求的转变。那么重疾险，我认为不能用见顶这个词吧。我觉得重疾险可能会进入一个比较缓慢增长的这样的一个趋势。而终身寿和年金险就是满足客户传承养老需求的储蓄类的这个产品，我认为在接下来会成为市场的一个主流或者主要的一个产品，这个产品支持。那么针对这种情况，我们也明确了就是我们的销售的方法，或者说是我们的这个销售的这个策略，也根据这个我们做了新的调整。首先我们将我们的客群定义为40到70岁的人，因为我们认为这一部分人是改革开放的受益者，是现在的主要的财富的拥有者，但同时这一部分人，特别是五六十岁的人，逐步在进入退休，所以他们有非常强烈的传承和养老的需求。同时，因为他们拥有家庭财富的支配权，所以他们也是家庭保单配置的买单人。所以我们认为呢，就是把我们的客群明确定位在40到70岁这个年龄，而重点是50岁到60岁这个年龄，即将进入退休的这部分人。今天我也说了，这部分人每年有2,500万人进入退休，所以我们的销售方法呢，也以传承和养老传承和养老作为一个切入口，去从我们的目前的这个寿险保单也可以看出来，就是我们的寿险保单70%的客户是没有买这个养老险，没有买终身寿的，这也导致我们在2021年我们得到了就是30%的客户的复购率。那么所以我们针对这部分客群，针对他的传承和养老的需求，来提供一个家庭的保单配置，保单这个保险组合的配置的销售方式。所以我们改变由产品驱动，以卖产品去作为这个切入口，改变为以传承、养老和家庭，家庭保单组合配置作为销售的方法。
For your second question regarding the product mix, we do observe a drastic change in our product mix in the past quarters and the past year. In the fourth quarter, whole life insurance and annuity life insurance collectively accounted for 70% of our total first year premium as compared to 20% contributed by critical illness products, as compared to in the first quarter, the percentage of whole life and annuity as compared to CI product is much lower. In the second quarter and third quarter, we already seen that the percentage of whole life and annuity has already surpassed that of CI products.
This is clearly reflected the changing demands in customers. As for whether or not this critical illness product has reached its ceiling, we will not say that, but we do believe that the growth of the critical illness insurance will slow down. In the future, savings products such as annuity, pension insurance and whole life insurance will become the main products. In response to this changing demands, we will also address our methods of selling. First of all, our target group will change to those people in the age of 40 to 70 years old, and particularly those in the age of 50 to 60 years old, who are going into retirement.
This group of people are the main beneficiary of China's economic development after the opening up of reform. These also are the group of people who own the wealth of the family. So as they are going into retirement, they have strong demands for elderly care, for legacy management, etc. As these people are also the owner of the family wealth, they are the main buyers, or they are the people who pay for family insurance policies. So this group of people will be our main target customers. Thank you. As I mentioned just now, in each year, there will be 250 million people going into retirement.
Going forward, we're going to address our sales methods to assess these people's needs for family asset allocation services by offering retirement and legacy management services. As I mentioned just now, there are about the repeated purchases rate among our existing customers for whole life and annuity products are about 30%, which means that 70% of our existing customers have not owned whole life and annuity products before. That's indicates a significant room for further growth. Thank you. Hope that answer your question.
好的，谢谢。谢谢。
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Okay, thank you for your attendance. If you have any follow-up questions, please feel free to contact me. Thank you.
This concludes today's conference call. Thank you for participating. You may now disconnect.