# 02628_13042026_1630_Annual Report 2025 > Source: `02628_13042026_1630_Annual Report 2025.pdf` > Pages: 224 > Converted: 2026-04-27T18:04:28 --- # 中国人寿保险股份有限公司 # China Life Insurance Company Limited Stock Code : 2628 # 2025 Annual Report --- The Company was established in Beijing, China on 30 June 2003 according to the Company Law and the Insurance Law of the People’s Republic of China. The Company was successfully listed overseas in December 2003 and returned to the domestic market as an A-share listed company in January 2007. The Company’s registered capital is RMB28,264,705,000. The Company is a leading life insurance company in China and possesses an extensive distribution network comprising exclusive agents, direct sales representatives, and dedicated and non-dedicated agencies. The Company is one of the largest institutional investors in China, and becomes one of the largest insurance asset management companies in China through its controlling shareholding in China Life Asset Management Company Limited. The Company also has controlling shareholding in China Life Pension Company Limited. The Company is a leading provider of life insurance, annuity insurance, health and accident insurance in China. As at the end of the Reporting Period, the Company had approximately 327 million long-term insurance policies in force. We also had a great quantity of short-term insurance policies, including accident insurance, health insurance and term life insurance, with a term of one year or less. # CONTENTS ## 01 PRELUDE 2 ### Core Competitiveness 2 ### Honors and Awards 3 ### Business Highlights 5 ### Financial Summary 6 ## 02 CHAIRMAN’S STATEMENT 8 ## 03 MANAGEMENT DISCUSSION AND ANALYSIS 11 ### Business Review 11 ### Analysis of Insurance Business 13 ### Analysis of Investment Business 19 ### Digitalised and Intelligent Operations 20 ### Customer Services 21 ### Analysis of Specific Items 22 ### Future Prospect 26 ## 04 EMBEDDED VALUE 27 --- # 05 SIGNIFICANT EVENTS | Section | Page | | :--- | :--- | | **SIGNIFICANT EVENTS** | **33** | | Material Litigations or Arbitrations | 33 | | Major Connected Transactions | 33 | | Material Contracts and Their Performance | 39 | | Undertakings | 39 | | Alleged Violation of Laws and Regulations, Penalties Imposed and Rectification | 40 | | Restriction on Major Assets | 40 | | Other Matters | 40 | # 06 CORPORATE GOVERNANCE | Section | Page | | :--- | :--- | | **CORPORATE GOVERNANCE** | **41** | | Report of the Board of Directors | 41 | | Changes in Ordinary Shares and Shareholders Information | 49 | | Directors, Senior Management and Employees | 52 | | Report of Corporate Governance | 64 | # 07 OTHER INFORMATION | Section | Page | | :--- | :--- | | **OTHER INFORMATION** | **94** | | Basic Information of the Company | 94 | | Definitions and Material Risk Alert | 96 | # 08 FINANCIAL REPORT | Section | Page | | :--- | :--- | | **FINANCIAL REPORT** | **97** | --- # CORE COMPETITIVENESS ## Long history and excellent brand The predecessor of the Company, one of the first batch of enterprises to underwrite insurance business in China, was approved by the Chinese Government for establishment in October 1949. After the restructuring and reorganisation, the Company was successively listed overseas and domestically. The Company has been playing the role of an explorer and pioneer in China’s life insurance industry, and through long-term and continuous brand building, China Life has become one of the famous and strong brands in the world with growing brand value and influence. ## Prominent principal business and sound financial strength The Company sticks to the original role of insurance and further explores the huge potentials of the life insurance market. The Company has a sound institutional and services network, with its business outlets and services counters covering both urban and rural areas across China, which forms a powerful distribution and services network and through which the Company maintains its leading position in China’s life insurance market and becomes the life insurance service provider within the reach of customers. Through the long-term development and accumulation, China Life has solid financial strength comparable to world-class enterprises in the world, with its total assets ranking No. 1 in the life insurance industry in China. As one of the largest institutional investors in China, the Company becomes one of the largest insurance asset management companies in China through its controlling shareholding in China Life Asset Management Company Limited. ## Convenient services and superb customer experience The Company adheres to the service concept of “honest and trustworthy, professional and efficient, customer-oriented, and first-class experience”, develops the operation model of “multiple accesses at the front-end, intelligent centralisation at the headquarters, and comprehensive sharing for operations”, and has established a customer-oriented digital operation and service system. The Company keeps considering and catering to demands of its customers, devoting itself to improve customer experience, and providing customers with “convenient, quality and caring” services. The Company also adheres to the concept of “people-oriented, caring for life, creating value and serving the community”, with the aim to consistently contribute to the protection of people’s good life. ## Leading technologies and innovation empowerment The Company implements the “Digitalised China Life” development strategy in great depth by adhering to the leading concept of technological innovation. The Company has established digital platforms closely integrating online and offline resources with teams and outlets as the support and industry-leading hybrid clouds as the base, creating an open, win-win and diversified digital insurance ecosystem, facilitating the Company’s digital transformation in all aspects, and accelerating the replacement of old growth drivers with new ones, through which the Company’s business operation is empowered in all aspects, and the Company is able to provide smart, convenient, efficient and well-targeted comprehensive financial and insurance services to the public. ## Professional and stable core team During the long course of its development, the Company has accumulated a wealth of experience in operation and management and has a stable and professional management team that is well versed in the art of management in China’s life insurance market. The Company’s core management team and key personnel comprise those who have in-depth knowledge and understanding of the life insurance market in China, including the Company’s senior management, experienced underwriting personnel, insurance actuaries, investment managers and risk management teams. During the Reporting Period, there was no change of the above personnel which might have a material impact on the Company. The Company has been pushing forward the reform of the market-oriented remuneration system, continuously stimulating its internal vitality, and building a talent team that matches its high-quality development. --- # HONORS AND AWARDS ## Ranking 1st S&P Global Market Intelligence "Top 50 Global Life Insurers" ## Ranking 89th globally in 2025 Forbes "2025 Forbes Global 2000" ## "Excellent Listed Company" Hong Kong Ta Kung Wen Wei Media Group, Hong Kong Chinese Enterprises Association, the Chinese Financial Association of Hong Kong, the Chinese Securities Association of Hong Kong and The Hong Kong Chartered Governance Institute "15th China Securities 'Golden Bauhinia Awards'" ## "Ark Prize for Insurance Company with High-quality Development" ## "Ark Prize for Inclusive Finance Practice in the Insurance Industry" Securities Times "2025 (10th) Ark Prizes for China's Insurance Industry" ## "Annual Insurance Protection Brand Award" ## "Annual Social Responsibility Award for Insurance Company" Shanghai Securities News "Shang Zheng Ying (Shanghai Securities News' service) – Assessment and Selection of the Golden Wealth Management" ## "Investment Golden Bull Award for the Insurance Industry" China Securities Journal "5th Investment Golden Bull Awards of the Insurance Industry" ## "Life Insurance Company with Excellent Competitiveness" ## "Financial Institutions with Excellent Competitiveness in Brand Building" China Business Journal "Cases of Financial Institutions with Excellent Competitiveness in 2025" --- ## “Insurance Company Worthy of Trust Award” **The Economic Observer** “2025 Assessment and Selection for a List of Financial Institutions Worthy of Trust” ## “Leading Insurance Company of the Year” ## “Leading Inclusive Financial Institution of the Year” **21st Century Business Herald** “Excellent Cases of Financial Competitiveness in the 21st Century (2025)” ## “Insurance Company with Steady and Long-term Development” ## “Financial Institution with Outstanding Brand Influence” **Investor Journal** “2025 Golden Bridge Awards of Thinking Finance” ## “Excellent Insurance Company” ## “Excellent Brand Management Company” **Investment Times** “2025 (8th) Golden Jubilee Awards” ## “Excellent Life Insurance Company of the Year” **National Business Daily** “16th Golden Tripod Awards” ## “Typical Cases of High-quality Development in the Insurance Industry during the ‘14th Five-Year Plan’” **PBC School of Finance of Tsinghua University and the Editorial Department of Tsinghua Financial Review** “2025 Competitiveness Ranking of the PRC Insurance Institutions” ## “Insurance Company with Brand Influence” ## “Social Responsibility Pioneer Award” **Hexun.com** “23rd Financial Annual Champion Awards” ## “High-quality Long-term Value Award” **StockStar** “13th StockStar” --- # BUSINESS HIGHLIGHTS | Metric | Value | Unit | | :--- | :--- | :--- | | Gross written premiums | 729,887 | RMB million | | Total assets | 7,591,004 | RMB million | | Net profit attributable to equity holders of the Company | 154,078 | RMB million | | Equity holders' equity | 595,205 | RMB million | | Embedded value | 1,467,876 | RMB million | | Value of one year's sales | 45,752 | RMB million | | Gross investment income | 387,694 | RMB million | | Gross investment yield | 6.09% | | | Number of long-term in-force policies | 3.27 | hundred million | --- # FINANCIAL SUMMARY ## MAJOR FINANCIAL DATA AND INDICATORS FOR THE PAST FIVE YEARS¹ RMB million **Under International Financial Reporting Standards ("IFRSs")** | Major financial data | 2025 | 2024 | Change | 2023 | 2022 | 2021 | | :--- | :--- | :--- | :--- | :--- | :--- | :--- | | **For the year ended** | | | | | | | | Total revenues | **616,065** | 528,627 | 16.5% | 344,746 | 370,861 | 824,933 | | Profit before income tax | **181,629** | 115,213 | 57.6% | 44,576 | 70,060 | 50,340 | | Net profit attributable to equity holders of the Company | **154,078** | 106,935 | 44.1% | 46,181 | 66,680 | 50,766 | | Net profit attributable to ordinary share holders of the Company | **154,078** | 106,935 | 44.1% | 46,181 | 66,680 | 50,766 | | Net cash inflow/(outflow) from operating activities | **459,925** | 378,795 | 21.4% | 384,366 | 345,284 | 286,446 | | **As at 31 December** | | | | | | | | Total assets | **7,591,004** | 6,769,546 | 12.1% | 5,802,086 | 5,010,068 | 4,892,480 | | Including: Investment assets² | **7,423,705** | 6,611,071 | 12.3% | 5,659,250 | 4,811,893 | 4,716,420 | | Total liabilities | **6,982,611** | 6,248,298 | 11.8% | 5,315,052 | 4,635,095 | 4,405,346 | | Including: Insurance contract liabilities | **6,376,114** | 5,825,026 | 9.5% | 4,859,175 | 4,266,947 | N/A | | Equity holders' equity | **595,205** | 509,675 | 16.8% | 477,093 | 366,021 | 479,061 | | **Per share (RMB)** | | | | | | | | Earnings per share (basic and diluted)³ | **5.45** | 3.78 | 44.1% | 1.63 | 2.36 | 1.80 | | Equity holders' equity per share³ | **21.06** | 18.03 | 16.8% | 16.88 | 12.95 | 16.95 | | Ordinary share holders' equity per share³ | **21.06** | 18.03 | 16.8% | 16.88 | 12.95 | 16.95 | | Net cash inflow/(outflow) from operating activities per share³ | **16.27** | 13.40 | 21.4% | 13.60 | 12.22 | 10.13 | | **Major financial ratios (%)** | | | | | | | | Weighted average ROE | **27.81** | 21.59 | An increase of 6.22 percentage points | 9.65 | 17.26 | 10.92 | | Gearing ratio⁴ | **91.99** | 92.30 | A decrease of 0.31 percentage point | 91.61 | 92.52 | 90.04 | | Gross investment yield⁵ | **6.09** | 5.50 | An increase of 0.59 percentage point | 2.43 | 3.90 | 4.98 | **Notes:** 1. Since 1 January 2023, the Company has implemented *IFRS 9 – Financial Instruments* and *IFRS 17 – Insurance Contracts*. The Company has restated and presented the comparative information for the year 2022 associated with insurance contracts in accordance with *IFRS 17 – Insurance Contracts*, and there is no need for the Company to restate and present the comparative information for the year 2022 associated with financial instruments in accordance with *IFRS 9 – Financial Instruments*. There is no need for the Company to restate and present any comparative information for the year 2021 in accordance with *IFRS 9 – Financial Instruments* and *IFRS 17 – Insurance Contracts*. 2. As at 31 December 2023, 31 December 2024 and 31 December 2025, investment assets include cash and cash equivalents, financial assets at fair value through profit or loss, investment in debt instruments at fair value through other comprehensive income, investment in equity instruments at fair value through other comprehensive income, investment in debt instruments at amortised cost, term deposits, financial assets purchased under agreements to resell, statutory deposits-restricted, investment properties, investments in associates and joint ventures, etc. As at 31 December 2022, investment assets include cash and cash equivalents, securities at fair value through profit or loss, available-for-sale securities, held-to-maturity securities, term deposits, financial assets purchased under agreements to resell, loans (excluding policy loans), statutory deposits-restricted, investment properties, investments in associates and joint ventures, etc. 3. In calculating the percentage changes of the "Earnings per share (basic and diluted)", "Equity holders' equity per share", "Ordinary share holders' equity per share" and "Net cash inflow/(outflow) from operating activities per share", the tail differences of the basic figures have been taken into account. 4. Gearing ratio = Total liabilities/Total assets 5. In the calculation of the investment yield of the years from 2023 to 2025, the average investment assets as the denominator exclude the fair value changes of investment in debt instruments at fair value through other comprehensive income, so as to reflect the strategic intention of the Company for the management of assets and liabilities. In the calculation of the investment yield of the year 2022, the data of investment businesses related to *IFRS 17 – Insurance Contracts* has been restated, while the data of investment businesses related to *IFRS 9 – Financial Instruments* has not been restated. The formula used for calculating the investment yield of the year 2022 is the same as that of previous years. --- # MAJOR ITEMS OF THE CONSOLIDATED FINANCIAL STATEMENTS WITH CHANGE OF OVER 30% AND THE REASONS FOR CHANGE RMB million ## Items of the consolidated statement of financial position | Items of the consolidated statement of financial position | As at 31 December 2025 | As at 31 December 2024 | Change | Main reasons for change | | :--- | :--- | :--- | :--- | :--- | | Investment in equity instruments at fair value through other comprehensive income | 317,876 | 171,817 | 85.0% | An increase in the scale of investment assets | | Cash and cash equivalents | 142,373 | 85,505 | 66.5% | The needs for liquidity management | | Financial assets sold under agreements to repurchase | 331,863 | 151,564 | 119.0% | The needs for liquidity management | | Financial liabilities at fair value through profit or loss | 82,010 | 53,521 | 53.2% | Participation of commercial pension insurance businesses by the subsidiaries | | Reserves | 81,337 | 119,033 | -31.7% | Due to the combined impact of changes in fair value of financial assets and financial changes in insurance contracts | ## Items of the consolidated statement of comprehensive income | Items of the consolidated statement of comprehensive income | 2025 | 2024 | Change | Main reasons for change | | :--- | :--- | :--- | :--- | :--- | | Investment income | 255,411 | 176,461 | 44.7% | Market value fluctuations of financial assets and proactive investment operations | | Income tax | 25,077 | 6,273 | 299.8% | Due to the combined impact of income tax payable and deferred income tax | | Net profit attributable to equity holders of the Company | 154,078 | 106,935 | 44.1% | The Company continued to deepen asset-liability interaction, further advanced the diversification of products and businesses, controlled liability costs in a scientific manner, consistently improved the cost efficiency, and dynamically optimised allocations across major asset classes, leading to a substantial increase in investment income | --- # CHAIRMAN’S STATEMENT 2025 marked the final year of the “14th Five-Year Plan”. China Life studied and implemented in-depth the spirits of the 20th CPC National Congress and the plenary sessions of the 20th CPC Central Committee, as well as the deployments of the Central Economic Work Conference and the National Financial System Work Conference. With the vision of building the Company into a world-class life insurance company with Chinese characteristics, distinguished by “exceptional business development, innovation-driven growth, efficient collaboration, and modern governance”, the Company steadfastly pushed forward its development in finance with Chinese characteristics, advancing high-quality development in a steady and sustainable manner. Over the past year, the Company seized the opportunities to press ahead with reforms and development, navigating headwinds with resilience. Core performance indicators reached record highs, market leading position remained solidified, and comprehensive strength was further bolstered. The Company concluded the “14th Five-Year Plan” with impressive results, and built a solid foundation for a new phase of high-quality development under the “15th Five-Year Plan”. As at the end of the Reporting Period, total assets reached RMB7.59 trillion, surpassing three successive RMB-trillion milestones during the “14th Five-Year Plan”. Net assets reached RMB608,393 million, an increase of 16.7% year on year, reflecting continuous enhancement of its capital strength. Embedded value stood at RMB1.47 trillion, remaining at the top of the industry. During the Reporting Period, gross written premiums amounted to RMB729,887 million, marking an increase of more than RMB100 billion from the first year of the “14th Five-Year Plan”. The value of one year’s sales reached RMB45,752 million, with a significant year-on-year increase of 35.7%. Net profit attributable to equity holders of the Company was RMB154,078 million, representing a strong growth of 44.1% from a high base. The weighted average return on equity reached 27.81%. Solvency adequacy remained at a robust level. The Company ranked first among Standard & Poor’s “Top 50 Global Life Insurers” by the scale of life and health insurance reserves. It received more than sixty awards, including the Excellent Listed Company of the “15th China Securities ‘Golden Bauhinia Awards’” and the “Investment Golden Bull Award for the Insurance Industry”, and its asset-liability management capability assessment remained at the highest level in the industry. We kept sharing the benefits of high-quality development with investors. The Board of Directors proposed to distribute a 2025 final cash dividend of RMB6.18 per 10 shares (inclusive of tax). Together with the 2025 interim cash dividend already paid, total annual dividends amounted to RMB8.56 per 10 shares (inclusive of tax), with aggregate dividend payouts reaching RMB24,195 million, an increase of 31.7% year on year. --- **We upheld our mission through concrete actions and fulfilled new responsibilities in serving the overall interests of national development.** With a steadfast commitment to the political and people-centric nature of finance, we leveraged insurance to safeguard people’s livelihoods and serve national strategies. By integrating into the overall interests of national development, we expanded our development space and cultivated stronger foundation for growth. We actively contributed to building a multi-tiered social security system, providing comprehensive insurance protection for people’s wellbeing, and our industry-leading position in inclusive insurance and pension insurance remained solid. We further enriched the supply of inclusive insurance products and extended coverage across key groups. Our commercial annuity insurance business continued to lead the industry, in particular, our third-pillar private pension business ranked among the top of the industry, contributing China Life’s strength to the wellbeing of the senior people. We supported rural revitalisation with high standards, underwriting agricultural-related life insurance for 242 million person-times and providing risk protection of RMB30 trillion. In fulfilling our role as a main force in serving the real economy, we precisely invested insurance funds to key areas and weak links of the real economy, intensifying support for the development of new quality productive forces and for high-level self-reliance and self-strengthening in science and technology. Seizing market opportunities, we vigorously advanced medium- and long-term investments to the capital market, and made decisive increases in equity investments, with equity investments in the open market exceeding RMB1.2 trillion, up by more than RMB450 billion from the beginning of the year. We continued to leverage our innovative private equity fund model, with cumulative fundraising exceeding RMB100 billion, creating demonstration effects in supporting capital market development. Our MSCI ESG rating advanced to Grade AA, placing our sustainability management level among global leaders. **We focused on our principal business and value creation, and reached new highs in operational quality and efficiency.** With development as the first priority, we concentrated on our primary responsibilities and principal business, adhered to long-termism, deepened asset-liability interaction, and strengthened value creation, thus lifting our operational quality and efficiency to new levels. We forged a robust strategic depth, and coordinated synergistic development across all channels. We continuously advanced the diversification of product supply and business development in terms of product form, duration and cost, achieving balanced growth among life insurance, annuity insurance and health insurance, with the proportion of long-term regular premiums in new business remaining at a relatively high level, which further strengthened the Company’s competitive advantage and bolstered its development resilience. We reinforced lean management and refined cost control, and cost efficiency saw a continuous improvement. During the Reporting Period, gross written premiums exceeded RMB700,000 million, setting a new industry record. The growth rate of the value of one year’s sales hit a new high for the same period since 2017. Our leadership positions in both business scale and value were further consolidated. Furthermore, we delivered our strongest investment performance in recent years, with gross investment income of RMB387,694 million, up by 25.8% year on year, and gross investment yield of 6.09%, up by 59 basis points year on year. **We tempered internal strengths, upheld integrity while pursuing innovation, and deepened reforms to usher a new chapter.** By enhancing our adaptability and deploying business model innovation in a forward-looking manner, we accelerated product iteration and service upgrade, and continuously enhanced our capabilities of long-cycle and cross-cycle operations and management. New growth engines gathered momentum and our core competitiveness steadily strengthened. We pushed forward synergistic empowerment and mutual progress across both assets and liabilities in depth, leading asset-liability interaction management to a new stage. We also effectively implemented a series of policies to proactively respond to shifts in the market interest rate environment. The transformation towards semi-priced businesses made notable strides, and guarantee rates for new business liabilities have declined steadily for three consecutive years. With a sustained focus on long-term investment, value investment and prudent investment, we continued to fortify our investment capabilities and dynamically optimised asset allocation in line with liability characteristics. As a result, the stability of investment income and our long-term return potential were enhanced, further consolidating the foundations for high-quality investment development. In response to customers’ multi-tiered and differentiated needs in insurance protection and wealth management, we deepened scenario-based integration and optimised protection functions, further enriching our product supply that covers the full life cycle. We made steady progress in building the “insurance + services” ecosystem, launched 20 residential senior-care services projects in a total of 16 cities nationwide, and the cumulative number of registered users on our healthcare and senior-care service platform exceeded 53 million. In embracing the “Artificial Intelligence+” transformation, we continued to drive digitalisation to empower the present and win the future. We successfully developed an artificial-intelligence empowerment platform and rolled out a series of large-model applications. The average efficiency for claims settlement improved to 0.36 day, and the “convenient, quality and caring” service experience was continuously enhanced. The assessment of consumer protection conducted by industry regulator and our life insurance service quality index remained at industry-leading position, and customer satisfaction remained high. --- ## We optimised governance to solidify our foundations, and made new strides in risk prevention and control. We coordinated business development and risk control, and anchored high-quality development as the fundamental means of preventing and mitigating risks, fostering a virtuous interaction between high-quality development and high-level security. We continued to enhance our comprehensive risk management system and mechanisms covering the entire chain, all areas and the whole process, and reinforced the guiding role of risk appetite, thus improving risk governance effectiveness and reinforcing the safety and robustness of our risk management system. We accelerated the digital and intelligent transformation of risk control, continuously upgrading closed-loop mechanisms for prevention prior to the event, control during the event and prevention and control after the event, and gradually building a proactive, intelligent and agile risk perception system. Through granular and penetrating oversight, we enhanced our "four-early" risk control capabilities (i.e. early identification, early warning, early exposure and early disposal), effectively addressed risks in key areas, and fortified the line of defense for secure development. In the integrated risk rating for insurance companies, we have maintained a Class A rating for 30 consecutive quarters, with the most recent eight consecutive quarters at the highest AAA rating. ## With strong winds driving our course, we embark once again on great challenges. 2026 marks the inaugural year of the "15th Five-Year Plan". Guided by Xi Jinping Thought on Socialism with Chinese Characteristics for a New Era, China Life will continue to uphold and strengthen the Party's overall leadership, fully, accurately and comprehensively implement the new development philosophy, and deeply engage in the "Five Priorities" of finance. Centering on the goal of building the country into a financial powerhouse, we will firmly fulfill our functions as a "shock absorber" for economic operation and a "stabiliser" for social development. With a keen sense of urgency, we will capitalise on the major strategic opportunities under the "15th Five-Year Plan", proactively respond to new dynamics, and lead emerging trends. By fully embracing the digital and intelligent era, we will accelerate forging the future China Life through digital and intelligent transformation, continuously enhance operational quality and efficiency as well as the capability for value creation, with an aim at delivering outstanding performance amid advancing Chinese-style modernisation. By Order of the Board **Cai Xiliang** *Chairman* 25 March 2026 --- # MANAGEMENT DISCUSSION AND ANALYSIS ## BUSINESS REVIEW In 2025, facing the increasingly complex and volatile internal and external environments, the Company committed to long-termism and upheld the core philosophy of "three consistencies", "three enhancements" and "three breakthroughs". It continued to strengthen asset-liability management, deepened operating synergies across all channels, and accelerated reforms in key areas. With multiple performance indicators hitting record highs, the Company maintained industry leadership positions in both business scale and value, delivering outstanding results characterised by balancing growth with quality, achieving dual excellence in business structure and profitability, and coordinating business development with risk control. The Company received various awards, including the Excellent Listed Company of the "15th China Securities 'Golden Bauhinia Awards'", and ranked first among Standard & Poor's "Top 50 Global Life Insurers". In the integrated risk rating for insurance companies, it has maintained a Class A rating for 30 consecutive quarters, with the most recent eight consecutive quarters at the highest AAA rating. **Business development reached new highs.** During the Reporting Period, the Company's gross written premiums exceeded RMB700,000 million for the first time, reaching RMB729,887 million, representing a year-on-year increase of 8.7%. First-year regular premiums were RMB116,205 million, continuing to lead the industry. The Company's long-term competitive advantages remained solid, with first-year regular premiums with a payment duration of ten years or longer totalling RMB52,197 million and accounting for 44.92% of first-year regular premiums. In particular, the proportion of first-year regular premiums with a payment duration of ten years or longer in the individual agent channel exceeded 58% of its first-year regular premiums. The Company continued to advance the sales system reforms, through which channel transformation released new growth momentum. As at the end of the Reporting Period, the number of the Company's total sales force was 638,000, maintaining the largest sales force in the industry, with continuous improvement in professionalisation, specialisation and rejuvenation of its sales force. --- **Business structure remained diversified and balanced.** The Company further enhanced the diversification of product supply and business development in terms of product form, duration and cost. During the Reporting Period, premiums from new policies from life insurance¹ (¹ Life insurance includes whole life insurance, term life insurance and endowment insurance.), annuity insurance and health insurance accounted for 31.75%, 32.11% and 31.23%, respectively. It vigorously pushed forward the business structure transformation. The ten-year and above business experienced strong growth, with its proportion in first-year regular premiums accounting for nearly 50%, evidencing solid progress in the business structure transformation. **Operational quality and efficiency was steadily enhanced.** The Company prioritised business value and profitability. The value of one year’s sales of 2025 achieved rapid growth, rising by 35.7% year on year to RMB45,752 million and continuing to lead the industry. The Company stepped up its efforts in cost reduction and efficiency improvement and strengthened refined management, which significantly improved cost efficiency. It also dynamically optimised asset allocation across major asset classes, leading to a substantial increase in investment income. Gross investment income reached RMB387,694 million, an increase of RMB79,443 million from the previous year. The gross investment yield was 6.09%, up by 59 basis points compared to the corresponding period of last year. **Comprehensive strengths continued to bolster.** As at the end of the Reporting Period, the Company’s total assets and investment assets were RMB7.59 trillion and RMB7.42 trillion, respectively. Equity holders’ equity amounted to RMB595,205 million, reflecting a year-on-year increase of 16.8%. The comprehensive solvency ratio and core solvency ratio were 174.01% and 128.77%, respectively, both maintaining at robust levels. The number of long-term in-force policies held by the Company was 327 million. Embedded value was RMB1.47 trillion, firmly leading the industry. The Company’s total market capitalisation and the scale of its life and health insurance reserves ranked first among global life insurance companies. By integrating the concept of asset-liability management across all aspects of its business operations and management, the Company consistently deepened asset-liability interaction. In 2025, net profit attributable to equity holders of the Company was RMB154,078 million, marking a strong year-on-year increase of 44.1% from a high base. ## Key Performance Indicators¹ (¹ The premiums, surrender payment, reserves in this report are relevant data under *Accounting Standards for Business Enterprises (“ASBE”) No. 25 – Direct Insurance Contracts* (Caikuai [2006] No. 3), *ASBE No. 26 – Reinsurance Contracts* (Caikuai [2006] No. 3) and the *Regulations regarding the Accounting Treatment of Insurance Contracts* (Caikuai [2009] No. 15).) RMB million | Item | 2025 | 2024 | |:---|:---:|:---:| | Gross written premiums | 729,887 | 671,457 | | Premiums from new policies | 234,079 | 214,172 | | Including: First-year regular premiums | 116,205 | 119,077 | |         First-year regular premiums with a payment duration of ten years or longer | 52,197 | 56,603 | | Renewal premiums | 495,808 | 457,285 | | Gross investment income | 387,694 | 308,251 | | Net profit attributable to equity holders of the Company | 154,078 | 106,935 | | Value of one year's sales | 45,752 | 33,709 | | Including: Individual agent channel | 39,299 | 31,313 | | Policy persistency rate (14 months)² (² The persistency rate for long-term individual life insurance policy is an important operating performance indicator for life insurance companies. It measures the ratio of in-force policies in a pool of policies after a certain period of time. It refers to the proportion of policies that are still effective during the designated month in the pool of policies whose issue date was 14 or 26 months ago.) (%) | 92.10 | 91.60 | | Policy persistency rate (26 months)² (%) | 88.80 | 85.60 | | Surrender rate³ (³ Surrender rate, which is for long-term insurance business, is the proportion of the surrender payment to the sum of the reserves at the beginning of the period and the premiums.) (%) | 0.95 | 1.01 | | | **As at 31 December 2025** | **As at 31 December 2024** | | Embedded value | 1,467,876 | 1,401,146 | | Number of long-term in-force policies (hundred million) | 3.27 | 3.26 | **Notes:** 1. The premiums, surrender payment, reserves in this report are relevant data under *Accounting Standards for Business Enterprises (“ASBE”) No. 25 – Direct Insurance Contracts* (Caikuai [2006] No. 3), *ASBE No. 26 – Reinsurance Contracts* (Caikuai [2006] No. 3) and the *Regulations regarding the Accounting Treatment of Insurance Contracts* (Caikuai [2009] No. 15). 2. The persistency rate for long-term individual life insurance policy is an important operating performance indicator for life insurance companies. It measures the ratio of in-force policies in a pool of policies after a certain period of time. It refers to the proportion of policies that are still effective during the designated month in the pool of policies whose issue date was 14 or 26 months ago. 3. Surrender rate, which is for long-term insurance business, is the proportion of the surrender payment to the sum of the reserves at the beginning of the period and the premiums. --- # ANALYSIS OF INSURANCE BUSINESS ## Figures of Gross Written Premiums ### Gross written premiums breakdown (RMB million) | Category | 2025 | 2024 | | :--- | :--- | :--- | | Renewal premiums | 495,808 | 457,285 | | Single premiums | 36,298 | 13,129 | | Short-term insurance premiums | 81,576 | 81,966 | | First-year regular premiums | 116,205 | 119,077 | ### Value of one year's sales (RMB million) | Year | Value | Change (%) | | :--- | :--- | :--- | | 2025 | 45,752 | 35.7%↑ | | 2024 | 33,709 | - | ### Embedded value (RMB million) | As at 31 December | Value | Change (%) | | :--- | :--- | :--- | | 2025 | 1,467,876 | 4.8%↑ | | 2024 | 1,401,146 | - | ## Figures of Gross Written Premiums **Gross Written Premiums Categorised by Business** (RMB million) | Business | 2025 | 2024 | | :--- | :--- | :--- | | **Life insurance business** | **597,893** | **538,711** | | First-year business | 149,480 | 129,683 | | — First-year regular | 114,263 | 116,557 | | — Single | 35,217 | 13,126 | | Renewal business | 448,413 | 409,028 | | **Health insurance business** | **120,221** | **119,136** | | First-year business | 73,097 | 71,198 | | — First-year regular | 1,942 | 2,520 | | — Single | 71,155 | 68,678 | | Renewal business | 47,124 | 47,938 | | **Accident insurance business** | **11,773** | **13,610** | | First-year business | 11,502 | 13,291 | | — First-year regular | — | — | | — Single | 11,502 | 13,291 | | Renewal business | 271 | 319 | | **Total** | **729,887** | **671,457** | Note: Single premiums in the above table include premiums from short-term insurance business. --- # Gross Written Premiums Categorised by Channel RMB million | Channel | 2025 | 2024 | | :--- | :--- | :--- | | **Individual agent channel¹** | **551,790** | **529,033** | | - First-year business of long-term insurance | 90,879 | 100,683 | | -- First-year regular | 89,171 | 100,248 | | -- Single | 1,708 | 435 | | - Renewal business | 442,285 | 409,823 | | - Short-term insurance business | 18,626 | 18,527 | | **Bancassurance channel** | **110,874** | **76,201** | | - First-year business of long-term insurance | 58,097 | 29,476 | | -- First-year regular | 26,478 | 18,776 | | -- Single | 31,619 | 10,700 | | - Renewal business | 52,368 | 46,299 | | - Short-term insurance business | 409 | 426 | | **Group insurance channel** | **26,230** | **27,625** | | - First-year business of long-term insurance | 1,427 | 1,742 | | -- First-year regular | 5 | 10 | | -- Single | 1,422 | 1,732 | | - Renewal business | 1,103 | 1,149 | | - Short-term insurance business | 23,700 | 24,734 | | **Other channels²** | **40,993** | **38,598** | | - First-year business of long-term insurance | 2,100 | 305 | | -- First-year regular | 551 | 43 | | -- Single | 1,549 | 262 | | - Renewal business | 52 | 14 | | - Short-term insurance business | 38,841 | 38,279 | | **Total** | **729,887** | **671,457** | Notes: 1. Gross written premiums of individual agent channel mainly include premiums of the general sales team and the upsales team, etc. 2. Gross written premiums of other channels mainly include premiums of government-sponsored health insurance business and online sales, etc. --- # Analysis of Business ## Analysis of Business by Channel The Company intensified operating synergies across all channels, shaping a multi-engine growth pattern and further accentuating its core competitive advantages. The individual agent channel securely maintained its core fundamentals of development and continued to serve as the main driver for value creation. The bancassurance channel played an effective role in strategic development, achieving strong growth in both business scale and value. The group insurance channel sharpened its focus on quality enhancement and efficiency improvement, which resulted in a continued improvement in profitability. The scale of government-sponsored health insurance business and the number of city-customised commercial medical insurance projects undertaken by the Company reached record highs. Both the online exclusive business and the integrated online-offline business saw rapid growth. ## Individual Agent Channel The individual agent channel pursued high-quality development in great depth and consistently prioritised business value. In 2025, it delivered steady progress in overall development, with continuous improvement in all performance indicators. Meanwhile, it accelerated channel transformation and upgrade, with a more diversified business structure. During the Reporting Period, gross written premiums from the individual agent channel were RMB551,790 million, marking a year-on-year increase of 4.3%. In particular, renewal premiums were RMB442,285 million, representing a year-on-year growth of 7.9%. First-year regular premiums were RMB89,171 million. First-year regular premiums with a payment duration of ten years or longer were RMB52,148 million, with its proportion in its first-year regular premiums further rising to 58.48%. As a result, its business structure and sustainability were enhanced. The Company vigorously advanced semi-priced business products. During the Reporting Period, participating insurance business experienced rapid growth, with its proportion in the first-year regular premiums of individual agent channel rising to nearly 60%, becoming an important contributor to premiums from new policies. It progressively emphasised the sales orientation of medium- to long-term policies of the major products, with policy terms more diversified. The combined proportion of the first-year regular premiums of the top five insurance products in the individual agent channel fell by more than 10 percentage points from the previous year, demonstrating a more diversified and balanced business structure. The value of one year's sales of the individual agent channel reached RMB39,299 million, increasing by 25.5% year on year. Focusing on high-quality sales force development, the individual agent channel steadily advanced sales system reforms in 2025, enhanced team routine operations, consolidated the team management framework, scaled up agent recruitment and development, and improved team structure, thus further boosting core capabilities and enhancing professionalisation, specialisation and rejuvenation of the sales force. As at the end of the Reporting Period, the number of agents of the individual agent channel was 587,000, maintaining the largest sales force in the industry, including 371,000 agents from the general sales team and 216,000 from the upsales team. The quality of the sales force continued to improve and high-quality new recruits expanded by 40.0% year on year, with the new force of the sales team getting stronger. ### Gross written premiums of individual agent channel (RMB million) | Year | First-year regular premiums | Gross written premiums | |------|-----------------------------|------------------------| | 2025 | 89,171 | 551,790 | | 2024 | 100,248 | 529,033 | | YoY Growth | - | 4.3% | ### Agents of individual agent channel 587,000 ## Bancassurance Channel By implementing the rules on "aligning sales practices with regulatory filings", the bancassurance channel advanced cost reduction and efficiency improvement, achieving strong growth. ### Gross written premiums of bancassurance channel (RMB million) | Year | First-year regular premiums | Gross written premiums | |------|-----------------------------|------------------------| | 2025 | 26,478 | 110,874 | | 2024 | 18,776 | 76,201 | | YoY Growth | 41.0% | 45.5% | ### Account managers of bancassurance channel 20,000 --- growth in both the scale of its premiums and the value of one year’s sales. Persisting a comprehensive deployment of the channel, it broadened its distribution network and improved the quality of the network operations. With a focus on professional development, it facilitated steady improvements of its sales force in both quantity and quality. It also enriched the bancassurance products to satisfy the diverse needs of customers, with sales of semi-priced products increasing significantly. During the Reporting Period, the bancassurance channel saw comprehensive improvements across all core indicators. Gross written premiums totalled RMB110,874 million, surpassing the RMB100 billion mark and reflecting a year-on-year increase of 45.5%. Premiums from new policies reached RMB58,506 million, marking a year-on-year increase of 95.7%. In particular, the proportion of premiums from new policies of participating insurance increased by around 15 percentage points year on year. First-year regular premiums amounted to RMB26,478 million, showing a year-on-year increase of 41.0%. Renewal premiums were RMB52,368 million, reflecting a year-on-year increase of 13.1%, accounting for 47.23% of the channel’s gross written premiums. The number of outlets issuing new policies reached 77,000, marking a year-on-year increase of 25.9%, including a 49.1% year-on-year increase in star-rated outlets. The number of account managers of the bancassurance channel was 20,000, with the productivity per account manager increasing by 53.7% year on year. ## Group Insurance Channel With a focus on profitability, the group insurance channel strengthened professional development and refined management and controls while driving the steady development across all business lines, achieving enhancement in quality and efficiency. During the Reporting Period, gross written premiums from the group insurance channel were RMB26,230 million, of which short-term insurance premiums were RMB23,700 million. The combined ratio for short-term insurance in the group insurance channel decreased significantly, leading to a substantial improvement in profitability. Meanwhile, it actively implemented the “Five Priorities” of finance, providing risk protection of exceeding RMB12 trillion to more than 200,000 small and micro enterprises. As at the end of the Reporting Period, the number of direct sales representatives of the group insurance channel was 31,000, with per capita productivity increasing by 6.9% year on year, continuing to improve steadily. ### Gross written premiums of group insurance channel (RMB million) | Year | Short-term insurance premiums | Gross written premiums (Total) | | :--- | :--- | :--- | | 2025 | 23,700 | 26,230 | | 2024 | 24,734 | 27,625 | **Direct sales representatives of group insurance channel: 31,000** ## Other Channels During the Reporting Period, gross written premiums from other channels amounted to RMB40,993 million, an increase of 6.2% year on year. The Company proactively participated in a variety of government-sponsored health insurance businesses, and vigorously engaged in the buildup of a multi-tiered medical security system. As at the end of the Reporting Period, it undertook over 200 supplementary major medical expenses insurance programs, over 70 long-term care insurance programs and over 140 city-customised commercial medical insurance projects. ## Online Insurance Business The Company continued to promote the development of online insurance business by optimising its online insurance business operation system featuring centralised operations and unified management, so as to provide customers with a quality service experience. In 2025, the online insurance business recorded total premiums² (² In the case of online insurance business defined in accordance with the regulatory scope under the Measures for the Regulation of Internet Insurance Business, total premiums include premiums from online insurance business conducted via the internet by various sales channels of the Company.) of RMB114,789 million, a year-on-year increase of 38.9%. Specifically, the Company’s online insurance business which integrated online and offline sales represented rapid growth, and the online exclusive business³ (³ The online life insurance business defined in accordance with the scope under the Notice of the General Office of the China Banking and Insurance Regulatory Commission on Further Regulating Matters Relating to Internet Personal Insurance Business of Insurance Institutions.) witnessed an exponential growth. The Company also enhanced the customer relationship management capability of the “China Life Insurance Mall” by enriching products, strengthening services and optimising experience, so as to meet the diversified protection needs of online customers. ## Analysis of Insurance Products In 2025, the Company firmly promoted product innovation and diversified supply under the new development situations. By agilely sensing the evolving trend of market demands, it optimised its product supply structure, and consistently improved its product and service supply system, with more than 170 new products launched. High-quality product supply met the needs of economic and social development and the public’s growing demands for insurance protection, serving the Company’s high quality development. --- ## The Company conscientiously implemented national strategies and deployments to strengthen people’s livelihood protection. It actively put the new “Ten National Guidelines” into practice and focused on the “Five Priorities” of finance to serve the national economy and people’s livelihood. In relation to commercial pension insurance, to address both the retirement protection needs of senior people and the pre-retirement planning needs of pre-senior people, the Company bolstered the supply of products aligned with the characteristics of commercial annuity insurance, including pension annuity insurance, other annuity insurance and endowment insurance, and continued to enrich products under the third-pillar private pension system, providing pension protection that covers full life cycle for the public. In relation to health insurance, the Company expanded health insurance coverage, deepened its focus on segmented customer groups, and advanced the integrated development of health protection and health services. It developed several first-ever health insurance products of the Company, including individual long-term disability income loss products, nursing service benefit products, maternity and infant illness insurance products, fracture-related accidental medical products for middle-aged and senior people, and senior-specific specified disease medical products. Meanwhile, it broadened coverage of liabilities and services by incorporating more innovative drugs and medical devices into the coverage of health insurance benefits. In relation to inclusive insurance, by serving key population groups such as rural residents, new urban residents and new industry practitioners, employees of small and micro enterprises, senior people, and students and children, and by supporting key areas linked to the Belt and Road Initiative and regional development, the Company reinforced the foundation of inclusive protection for the people. It introduced specific inclusive insurance products, including rural revitalisation, domestic worker, “Silver Age Healthcare” (銀齡安康), and the “Belt and Road” product series, to meet differentiated and personalised livelihood protection needs. ## The Company strengthened its diversified product supply with effective coordination in asset-liability management. Adhering to the diversified product supply strategy, the Company consistently broadened the depth of “diversified” offerings while reinforcing asset-liability interaction management. Coping with the increasingly diverse and segmented demands across different groups and regions, the Company embedded its product supply into various demand scenarios such as wealth management, pension savings, children’s education and medical protection, achieving targeted coverage of protection needs and enhancing both the accessibility and suitability of product protection functions. Consistent with asset-liability interaction management, the Company implemented the mechanism for linking the product’s guaranteed interest rates to market interest rates with dynamic adjustments, continued to enrich semi-priced products such as participating insurance, and advanced product iteration, upgrade and structural optimisation. It further promoted the diversification of product system in terms of product form, duration and cost, to better address customers’ diverse and different insurance protection needs. ### Top Five Insurance Products in terms of Gross Written Premiums in 2025 RMB million | Insurance product | Gross written premiums | Standard premiums from new policies Note | Major sales channel | Surrender payment | | :--- | :---: | :---: | :--- | :---: | | China Life Xin Xiang Wei Lai Endowment Insurance (國壽鑫享未來兩全保險) | 37,044 | – | Mainly through the channel of exclusive individual agents | 397 | | China Life Xin Yao Long Teng Endowment Insurance (國壽鑫耀龍騰兩全保險) | 36,108 | – | Mainly through the channel of exclusive individual agents | 346 | | China Life Xin Fu Lin Men Annuity Insurance (國壽鑫福臨門年金保險) | 33,382 | – | Mainly through the channel of exclusive individual agents | 1,259 | | China Life Critical Illness Group Health Insurance for Rural and Urban Citizens (Type A) (國壽城鄉居民大病團體醫療保險(A型)) | 30,364 | 30,364 | Through other channels | – | | China Life Xin Yi Feng Nian Pension Annuity Insurance (Participating Insurance) (國壽鑫益豐年養老年金保險(分紅型)) | 22,986 | 7,027 | Mainly through the channel of exclusive individual agents | 86 | Note: Standard premiums are calculated in accordance with the calculation methods set forth in the *Notice on Establishing the Industry Standard of Standard Premiums in the Life Insurance Industry* (Bao Jian Fa [2004] No. 102) and the *Supplementary Notice regarding the “Notice on Establishing the Industry Standard of Standard Premiums in the Life Insurance Industry”* (Bao Jian Fa [2005] No. 25) of the former China Insurance Regulatory Commission. --- # "Insurance + Services" Ecosystem Upholding the "customer-centric" approach, the Company vigorously propelled the development of an "insurance + services" ecosystem to empower the development of its principal business. ## Integrated Financial Business The Company fully leveraged the synergetic advantage of China Life Group across three principal business sectors: insurance, investment and banking. Centered on the business philosophy of "One China Life, Lifelong Protection", it persistently enriched its integrated financial product and service system by launching business collaborations between insurance, banking and investment entities, thus providing customers with all-round, full life cycle and high-quality financial and insurance services that encompassed insurance protection, wealth management, and healthcare and senior-care services. In 2025, premiums of CLP&C cross-sold by the Company through collaboration were RMB25,534 million, with the number of insurance policies increasing by 12.3% year on year. The Company established a "life insurance + property insurance" product portfolio protection model, and leveraged its enriched product advantage to expand diversified marketing scenarios. It also developed insurance-bank synergy service scenarios such as "Xin Xu Bao" (鑫續寶) and "An Xin Fu" (安鑫付), and partnered with CGB to host customer events including "Little Financier", "CGB Open Day" and "Integrated Finance Experience Day". The Company entrusted CGB to sell its bancassurance products, with the first-year regular premiums amounting to RMB1,860 million. The business scale of Pension Company cross-sold by the Company through collaboration grew steadily. The Company further deepened its business cooperation with AMC and CLI, leveraging expertise in insurance and investment to propel the in-depth development of insurance-investment synergy. ## Inclusive Healthcare and Integrated Senior-care Service System In 2025, the Company steadily advanced the construction of its healthcare and senior-care services system. Centering on three product lines — residential senior care, home-based senior-care and healthcare services — it enriched the diversified supply of healthcare and senior-care services to establish a healthcare and senior-care services ecosystem with China Life characteristics. With respect to the "insurance + senior-care services", the Company adhered to the philosophy of building a senior-care ecosystem that "reassures the senior people and gives children peace of mind". By leveraging the long-term and stable advantages of insurance funds, it promoted the deployment of three major senior-care product lines, namely continuing care retirement communities (CCRC), "city center" retirement apartments, and healthcare and senior-care sojourn facilities. As at the end of 2025, it had launched 20 residential senior-care services projects in a total of 16 cities, including Beijing, Tianjin, Qingdao, Suzhou, Shenzhen and Chengdu, and introduced the first batch of four "Sui Xin Ju" (隨心居) sojourn senior-care products. The Company also actively explored the development of a home-based senior-care service system to address the diversified senior-care needs of customers, thereby empowering the growth of principal insurance business. With respect to the "insurance + healthcare services", the Company integrated internal and external resources to continue to enrich the supply of health services. Centering on customers' needs including medical consultations and rehabilitation care, it rolled out corresponding health management services to provide customers with diversified benefits. It further optimised health service process management and key stages control, and enhanced the digitalised and intelligent capabilities of healthcare and senior-care services. As at the end of 2025, the cumulative number of registration on the Company's healthcare and senior-care platform increased by 8.8% from the end of 2024. --- # ANALYSIS OF INVESTMENT BUSINESS In 2025, bond market interest rates experienced modest fluctuations at low level, and term spreads widened at the ultra-long end. The stock market showed robust overall performance, with significant structural differentiation. Adhering to asset-liability interaction management and the philosophy of long-term investment, value investment and prudent investment, the Company continued to enhance its professional capability in investment, and dynamically optimised allocations across major asset classes, further strengthening the stability of investment portfolio returns and improving its long-term return potential. In respect of fixed-income investments, the Company flexibly adjusted allocation pace and product strategies, and continued to strengthen the allocation of foundational positions. In respect of equity investments, it vigorously advanced the entry of medium- and long-term funds into the market, capitalised on market opportunities to make decisive increases in equity investments, actively engaged in investment deployment in areas linked to new quality productive forces, and steadily expanded allocations to high-dividend stocks. In respect of alternative investments, it concentrated on high-quality entities as well as core assets, innovated investment models, and strengthened forward-looking deployment. As a whole, the Company maintained a stable portfolio with high-quality assets. ## Investment Portfolios RMB million | Items | As at 31 December 2025 Amount | As at 31 December 2025 Percentage | As at 31 December 2024 Amount | As at 31 December 2024 Percentage | | :--- | :--- | :--- | :--- | :--- | | **Categorised by investment object** | | | | | | Fixed-maturity financial assets | 5,234,179 | 70.51% | 4,911,524 | 74.29% | |   Term deposits | 418,688 | 5.64% | 438,455 | 6.63% | |   Bonds | 4,257,872 | 57.36% | 3,903,074 | 59.04% | |   Debt-type financial products¹ | 519,517 | 7.00% | 523,721 | 7.92% | |   Other fixed-maturity investments² | 38,102 | 0.51% | 46,274 | 0.70% | | Equity financial assets | 1,676,327 | 22.57% | 1,269,086 | 19.19% | |   Common stocks | 835,342 | 11.25% | 501,083 | 7.58% | |   Funds³ | 421,842 | 5.68% | 306,551 | 4.64% | |   Other equity investments⁴ | 419,143 | 5.64% | 461,452 | 6.97% | | Investment properties | 11,702 | 0.16% | 12,319 | 0.19% | | Cash and others⁵ | 193,709 | 2.61% | 116,065 | 1.76% | | Investments in associates and joint ventures | 307,788 | 4.15% | 302,077 | 4.57% | | **Total** | **7,423,705** | **100.00%** | **6,611,071** | **100.00%** | | **Categorised by accounting method** | | | | | | Financial assets at fair value through profit or loss | 2,067,288 | 27.85% | 1,908,098 | 28.86% | | Investment in debt instruments at amortised cost | 173,992 | 2.34% | 196,754 | 2.98% | | Investment in debt instruments at fair value through other comprehensive income | 3,926,042 | 52.89% | 3,458,895 | 52.32% | | Investment in equity instruments at fair value through other comprehensive income | 317,876 | 4.28% | 171,817 | 2.60% | | Investments in associates and joint ventures | 307,788 | 4.15% | 302,077 | 4.57% | | Others | 630,719 | 8.49% | 573,430 | 8.67% | | **Total** | **7,423,705** | **100.00%** | **6,611,071** | **100.00%** | Notes: 1. Debt-type financial products¹ ¹ Debt-type financial products include debt investment schemes, trust schemes, asset-backed plans, credit asset-backed securities, specialised asset management plans, and asset management products, etc. 2. Other fixed-maturity investments² ² Other fixed-maturity investments include statutory deposits-restricted and interbank certificates of deposits, etc. 3. Funds³ ³ Funds include equity funds, bond funds and money market funds, etc. In particular, the balances of money market funds as at 31 December 2025 was RMB3,339 million. 4. Other equity investments⁴ ⁴ Other equity investments include private equity funds, unlisted equities, preference shares and equity investment plans, etc. 5. Cash and others⁵ ⁵ Cash and others include cash, cash at banks, short-term deposits, and financial assets purchased under agreements to resell, etc. As at the end of the Reporting Period, the Company's investment assets reached RMB7,423,705 million, an increase of 12.3% from the end of 2024. The percentage of investment in major assets categories including bonds, term deposits and debt-type financial products generally remained stable, and the percentage of investment in stocks and funds (excluding money market funds) increased to 16.89% from 12.18% as at the end of 2024, mainly because the Company capitalised on market opportunities to make decisive increases in equity investments, leading to a significant increase in equity investments. --- # Investment Income RMB million | Item | 2025 | 2024 | | :--- | :---: | :---: | | **Gross investment income** | **387,694** | 308,251 | | **Net investment income** | **193,795** | 195,674 | | Net income from fixed-maturity investments | 151,512 | 146,587 | | Net income from equity investments | 34,753 | 34,489 | | Net income from investment properties | 3 | 93 | | Investment income from cash and others | 1,174 | 2,428 | | Investment income from associates and joint ventures | 6,353 | 12,077 | | **+ Realised disposal gains** | **132,951** | (4,245) | | **+ Unrealised gains or losses** | **63,307** | 118,160 | | **– Expected credit losses of investment assets** | **131** | (264) | | **– Impairment losses of investment assets** | **2,228** | 1,602 | | **Gross investment yield** | **6.09%** | 5.50% | Note: In the calculation of the investment yield, the average investment assets as the denominator exclude the fair value changes of investment in debt instruments at fair value through other comprehensive income, so as to reflect the strategic intention of the Company for the management of assets and liabilities. In 2025, the gross investment income was RMB387,694 million, an increase of RMB79,443 million from the corresponding period of 2024, and the gross investment yield was 6.09%, up by 59 basis points from the corresponding period of 2024. ## Credit Risk Management The Company’s credit asset investments mainly included credit bonds and debt-type financial products, which concentrated on sectors such as banking, transportation, non-banking finance, public utilities, and energy. As at the end of the Reporting Period, over 99% of the credit bonds held by the Company were rated AAA by external rating institutions, whereas over 99% of the debt-type financial products were rated AAA by external rating institutions. In general, the asset quality of the Company’s credit investment products was in good condition, and the credit risks were well controlled. The Company insisted on a prudent investment philosophy. Based on a disciplined and scientific internal rating system and a multi-dimensional management mechanism of risk limits, the Company prudently scrutinised credit profiles of targets and risk exposure concentration before investing and carried out ongoing tracking after investment, effectively controlling credit risks through early identification, early warning, early exposure and early disposal. ## Major Investments During the Reporting Period, there was no material equity investment or non-equity investment of the Company that was subject to disclosure requirements. # DIGITALISED AND INTELLIGENT OPERATIONS Focusing on serving its principal insurance business through technology, the Company established a closed-loop, digitalised and intelligent empowerment system spanning the entire operations and management chain. It strengthened data governance, fully released the potential of data elements, and continued to improve its proprietary computing power. It also implemented large-model applications across multiple dimensions, including knowledge bases, intelligent agents and AI robots, injecting sustained momentum into the Company’s high-quality development through digital-intelligent dual engines. Proactively aligning with the national “AI+” initiative, the Company built a comprehensive AI capability system that covered all aspects of its operations and management. It created a data space featuring “hundreds-of-millions-level data, tens of thousands of features and hundreds of tag dimensions”, and was selected by the National Data Administration as a pilot company for trusted data space innovation in 2025. The Company has achieved industry outstanding results in the “Data Elements x” (數據要素x) competition for two consecutive years. It also actively engaged in the industry standardisation program, and continued to share China Life’s expertise to support technological innovation of the industry, demonstrating its industry influence through technological capabilities. --- ## Optimising service capabilities. The Company upgraded its customer-centric digitalised and intelligent service ecosystem, delivering more accurate intelligent recommendations and smoother voice interactions. Intelligent claims processing continued to iterate, with the proportion of cases addressed through digitalised and intelligent services exceeding 75%, and claims settlement efficiency remaining at the forefront of the industry. In 2025, one-stop "Direct Claims Payment" service processed over 5.3 million cases, and the intelligent system proactively identified claim cases for 680,000 person-times and prompted customers to file claims on them. Direct data connectivity enabled fast-track claims services with no documentation required, with payouts credited to customer accounts within seconds. ## Empowering operational quality and efficiency enhancement. The Company established a new AI-enabled research and development paradigm, with the proportion of code produced through AI-assisted programming reaching 30%. Large models empowered agents to pursue more professional and personalised business development, improving customer-outreach efficiency, and lifting annual customer visits by more than 15% year on year. Leveraging intelligent technologies, the Company re-engineered underwriting workflows in the group insurance and bancassurance businesses, driving coordinated improvements in both business scale and quality. It also accelerated the adoption of AI-assisted manual operations. In 2025, the processing rate of digital underwriters exceeded 24%, the intelligent processing rate for policy administration services reached 99%, and scenarios for claims settlement without manual services continued to expand, with full-automation processing rate across end-to-end workflows surpassing 60% in certain regions. ## Strengthening risk prevention and control. The Company implemented enterprise-wide risk monitoring powered by AI-driven anti-fraud, anti-money laundering, anti-mis-selling and consumer protection, enabling precise risk identification and real-time risk interdiction. It deployed digital auditors and applied intelligent solutions across multiple scenarios to enhance audit oversight. The Company reinforced customer data protection, established trusted safeguards for data circulation, and successfully obtained ISO 27701 privacy information management system certification, reflecting its data security level in line with leading international standards. # CUSTOMER SERVICES In 2025, with the people-centric value orientation, the Company bolstered service capabilities across every contact points and innovated service models, effectively safeguarding consumers' lawful rights and interests. Throughout the year, it served customers more than 3 billion person-times and vigorously developed the "China Life Good Services" brand, featured with "convenient, quality and caring" services. It maintained at industry-leading position in the assessment of consumer protection conducted by industry regulator, providing robust and sustained support to its high-quality development. ## Contact point services became more convenient. The Company continuously expanded an integrated "online-and-offline" digital service matrix. The China Life APP was upgraded, continually enhancing the "one-click access online" service experience, with cumulative users reaching 170 million. Through its "Cloud Counter", online customer service staff responded efficiently to customer requests, with connection rates remaining high. The senior-friendly version of China Life APP was further optimised. "Zero-input" intelligent voice claim notification became more convenient, and the 95519 customer service hotline navigation and the digital-intelligent capability of online robot were significantly enhanced, thus improving the service efficiency remarkably. Nearly 2,500 offline service centers across the country made services more tangible and accessible. ## Original aspiration was demonstrated through warm services. The Company developed distinctive service scenarios centered on characteristics of customer segment. To address critical-illness customers' urgent need for treatment funds, it operated a "Claims Settlement for Critical Illness within One Day" green channel, serving 230,000 person-times. Service activities, with themes such as parent-child interaction, self-enrichment, health and VIP event, attracted 58.31 million person-times in participation over the year. The "Bringing Art to the Countryside" youth art-education project extended to 20 provinces, supporting rural cultural revitalisation. The Company also provided barrier-free services of 27.78 million person-times for senior people. As a principal drafting unit, it participated in designing the industry standard, namely the *Specification for Services for Senior Customers of Insurance Institutions* (《保險機構老年客戶服務規範》), contributing its expertise for enhancing service quality of the industry. ## Consumer protection was sound and effective. The Company further advanced a "comprehensive consumer protection" paradigm, and strengthened suitability management, product classification and tiered management, and tiered management of sales qualifications in a solid manner, thereby enhancing consumer protection management systems and mechanisms. Over the year, the "Voice of Customers" was captured more than 20 million person-times, and the service quality index remained at industry-leading level. The Company also built a new ecosystem for financial education, innovatively launching scenario-based and engaging promotional contents such as "Senior Companion Class" (長者陪伴課堂) offline activities and themed videos. In 2025, the number of consumers reached through related education and promotional activities increased by 31.4% year on year. --- # ANALYSIS OF SPECIFIC ITEMS ## Insurance Revenue Insurance revenue primarily includes expected insurance service expenses incurred in the current period, amortisation of contractual service margin, changes in the risk adjustment for non-financial risk, amortisation of insurance acquisition cash flows, and allocations using the premium allocation approach, etc., all recognised within the insurance period. RMB million | | 2025 | 2024 | Change | | :--- | :---: | :---: | :---: | | **Insurance revenue** | **214,136** | **208,161** | **2.9%** | | Contracts measured using the premium allocation approach | 50,096 | 51,286 | -2.3% | | Contracts not measured using the premium allocation approach | 164,040 | 156,875 | 4.6% | ## Insurance Service Expenses Insurance service expenses primarily include incurred claims and other expenses, amortisation of insurance acquisition cash flows, and losses and reversals of losses on onerous contracts, etc. RMB million | | 2025 | 2024 | Change | | :--- | :---: | :---: | :---: | | **Insurance service expenses** | **148,736** | **180,544** | **-17.6%** | | Contracts measured using the premium allocation approach | 49,808 | 51,873 | -4.0% | | Contracts not measured using the premium allocation approach | 98,928 | 128,671 | -23.1% | ## Insurance Finance Income/(Expenses) from Insurance Contracts Issued Insurance finance income/(expenses) from insurance contracts issued refers to the profit or loss arising from insurance contracts relating to the effect of time value of money and financial risk, of which the amount for contracts measured using the variable fee approach is the amount recognised in profit or loss arising from the corresponding investment assets. RMB million | | 2025 | 2024 | Change | | :--- | :---: | :---: | :---: | | **Insurance finance income/(expenses) from insurance contracts issued** | **258,858** | **209,952** | **23.3%** | --- # Insurance Contract Liabilities RMB million | | As at 31 December 2025 | As at 31 December 2024 | Change | | :--- | :---: | :---: | :---: | | Contracts measured using the premium allocation approach | 36,384 | 35,570 | 2.3% | | Contracts not measured using the premium allocation approach | 6,339,730 | 5,789,456 | 9.5% | | **Total of insurance contract liabilities** | **6,376,114** | 5,825,026 | 9.5% | | Liabilities for incurred claims | 63,641 | 64,339 | -1.1% | | Liabilities for remaining coverage | 6,312,473 | 5,760,687 | 9.6% | | **Total of insurance contract liabilities** | **6,376,114** | 5,825,026 | 9.5% | | Including: Contractual service margin | 768,369 | 742,488 | 3.5% | As at the end of the Reporting Period, the insurance contract liabilities of the Company were RMB6,376,114 million, an increase of 9.5% from the end of 2024, primarily due to the combined impact of the accumulation of insurance liabilities from new policies and renewals and the change in market interest rates. The contractual service margin of insurance contracts was RMB768,369 million, an increase of 3.5% from the end of 2024, primarily due to the impact of new policies for the current period. The contractual service margin for insurance contracts initially recognised in the current period was RMB53,074 million, a year-on-year decrease of 8.0%, primarily due to the impact of the change in market interest rates. # Analysis of Cash Flows ## Liquidity Sources The Company’s liquidity sources mainly come from insurance premiums received, interest and dividends, proceeds from the sale or maturity of investment assets, and cash inflows from financing activities. The Company continues to deepen its asset-liability management, and maintains an appropriate proportion of liquid assets within its investment portfolio to meet liquidity needs. In addition, it can access additional liquidity through securities sold under agreements to repurchase and other financing arrangements. As at the end of the Reporting Period, the Company’s balance of cash and cash equivalents was RMB142,373 million. ## Liquidity Uses The Company’s major cash outflows relate to cash outflows arising from its various life insurance, annuity, accident insurance and health insurance businesses, expenses and commissions, income taxes, and dividends declared and paid to its equity holders. Cash outflows arising from insurance activities primarily include benefit payments, claim payments, surrender payments and policyholder loans. The Company believes that its sources of liquidity are sufficient to meet its current cash requirements. --- # Statement of Cash Flows The Company has established a cash flow testing system, and conducts regular tests to monitor the cash inflows and outflows under various scenarios and adjusts the asset portfolio accordingly to ensure sufficient sources of liquidity. RMB million | | 2025 | 2024 | Change | Main reasons for change | | :--- | :--- | :--- | :--- | :--- | | Net cash inflow/(outflow) from operating activities | 459,925 | 378,795 | 21.4% | The increase in the business scale of the Company | | Net cash inflow/(outflow) from investing activities | (547,368) | (354,620) | 54.4% | The needs for investment management | | Net cash inflow/(outflow) from financing activities | 144,341 | (86,759) | N/A | The needs for liquidity management | | Foreign exchange gains/(losses) on cash and cash equivalents | (30) | 28 | N/A | – | | **Net increase/(decrease) in cash and cash equivalents** | **56,868** | **(62,556)** | **N/A** | **–** | # Solvency Ratio An insurance company shall have the capital commensurate with its risks and business scale. According to the nature and capacity of loss absorption by capital, the capital of an insurance company is classified into the core capital and the supplementary capital. The core solvency ratio is the ratio of core capital to minimum capital, which reflects the adequacy of the core capital of an insurance company. The comprehensive solvency ratio is the ratio of the sum of core capital and supplementary capital to minimum capital, which reflects the overall capital adequacy of an insurance company. RMB million | | As at 31 December 2025 | As at 31 December 2024 | | :--- | :--- | :--- | | Core capital | 777,291 | 767,446 | | Actual capital | 1,050,358 | 1,039,821 | | Minimum capital | 603,624 | 500,489 | | Core solvency ratio | 128.77% | 153.34% | | Comprehensive solvency ratio | 174.01% | 207.76% | As at the end of the Reporting Period, the Company's comprehensive solvency ratio and core solvency ratio were 174.01% and 128.77%, respectively, both continuing to stay at robust levels. Due to the impact of the factors including the change in market interest rates and the increase in the allocation in equity assets, the solvency ratios decreased compared to those at the end of 2024. # Sale of Material Assets and Equity During the Reporting Period, there was no sale of material assets and equity of the Company. --- # Major Subsidiaries and Associates of the Company ## Major subsidiaries and associates affecting more than 10% of the Company's net profit RMB million | Company name | Company type | Major business scope | Registered capital | Total assets | Net assets | Operating revenue | Operating profit | Net profit | | :--- | :--- | :--- | :---: | :---: | :---: | :---: | :---: | :---: | | China Life Asset Management Company Limited | Subsidiary | Management and utilisation of proprietary funds; acting as agent or trustee for asset management business; consulting business relevant to the above businesses; other asset management business permitted by applicable PRC laws and regulations. | 4,000 | 29,406 | 24,509 | 8,250 | 6,426 | 4,916 | | China Life Pension Company Limited | Subsidiary | Group pension insurance and annuity; individual pension insurance and annuity; short-term health insurance; accident insurance; reinsurance of the above insurance businesses; business for the use of insurance funds that are permitted by applicable PRC laws and regulations; pension insurance asset management product business; management of funds in RMB or foreign currency as entrusted by entrusting parties for the retirement benefit purpose; other businesses permitted by the NFRA. | 3,400 | 91,571 | 9,467 | 4,298 | 2,361 | 1,748 | Note: During the Reporting Period, there are no associates that affect more than 10% of the Company’s net profit. ## Acquisition and disposal of subsidiaries during the Reporting Period The details of acquisition and disposal of subsidiaries during the Reporting Period are set out in Note 31(b) in the Notes to the Consolidated Financial Statements in this annual report. ## Structured Entities Controlled by the Company Details of structured entities controlled by the Company are set out in Note 31(b) in the Notes to the Consolidated Financial Statements in this annual report. --- # FUTURE PROSPECT ## Industry Landscape and Development Trends During the “14th Five-Year Plan” period, guided by the spirits of the 20th CPC National Congress, the plenary sessions of the 20th CPC Central Committee and the Central Financial Work Conference, the insurance industry further strengthened its roles as a “shock absorber” for economic operation and a “stabiliser” for social development. In the inaugural year of the “15th Five-Year Plan”, China will adopt more proactive macro policies, continue to expand domestic demand and optimise supply, foster new growth drivers while revitalising existing stock, develop new quality productive forces in a manner suited to local conditions, and advance the construction of a unified national market in greater depth, thereby promoting effective improvement in quality and reasonable growth in quantity of the economy and laying a solid economic foundation for the insurance industry’s development. Meanwhile, “risk prevention, stringent regulation and promoting high-quality development” have become the main regulation themes. Regulators are continuing to refine the policy system focusing on aspects including the “Five Priorities” of finance, high-quality development, asset-liability management and compliant operations. The reform of individual agent sales system and the rules on “aligning sales practices with regulatory filings” are being implemented in greater depth, and the dynamic adjustment mechanism for the product’s guaranteed interest rates is progressing in an orderly manner, which further steer the industry’s transformation and reinforce the foundations for long-term, healthy and sustainable development of the industry. ## Development Strategies and Business Plans of the Company In 2026, the Company will uphold the theme of high-quality development and adhere to the overall principle of seeking progress while maintaining stability. Guided by the core philosophy of “three consistencies”, “three enhancements” and “three breakthroughs”, the Company will push forward comprehensively deepening reforms in key areas including digital-intelligent transformation, upgrading of operational and management models, coordinated synergistic development across all channels, customer relationship management, and investment capability building, striving to achieve deeper breakthroughs. It will elevate services to the overall national interests to a new level, further consolidate its industry leading position, deliver steady growth in both business scale and value, continue to optimise its business structure, cultivate new growth engines and growth poles, and fortify the line of defense for secure development. The Company will accelerate its journey toward being a world-class life insurance company with Chinese characteristics, distinguished by “modern governance, outstanding insurance function, exceptional business development, advanced management, innovation-driven growth, and fortified security and resilience”. ## Potential Risks Currently, the external environment is complex and volatile, where strategic opportunities coexist with risks and challenges, mingled with increasing uncertain and unpredictable factors. Within the insurance industry, asset-liability management remains challenging and competitive dynamics continue to intensify, while cross-sector competitions from technology giants and internet platforms are getting increasingly acute. The industry still remains in the transition from conventional growth drivers to new ones, heightening the urgency of transformation and upgrading. The Company anticipates that it will have sufficient capital to meet its insurance business expenditures and new general investment needs in 2026. At the same time, the Company will make corresponding financing arrangements based on capital market conditions if it plans to implement any business development strategies in the future. --- # EMBEDDED VALUE ## BACKGROUND China Life Insurance Company Limited prepares financial statements to public investors in accordance with the relevant accounting standards. An alternative measure of the value and profitability of a life insurance company can be provided by the embedded value method. Embedded value is an actuarially determined estimate of the economic value of the life insurance business of an insurance company based on a particular set of assumptions about future experience, excluding the economic value of future new business. In addition, the value of one year’s sales represents an actuarially determined estimate of the economic value arising from new life insurance business issued in one year based on a particular set of assumptions about future experience. China Life Insurance Company Limited believes that reporting the Company’s embedded value and value of one year’s sales provides useful information to investors in two respects. First, the value of the Company’s in-force business represents the total amount of shareholders’ interest in distributable earnings, in present value terms, which can be expected to emerge over time, in accordance with the assumptions used. Second, the value of one year’s sales provides an indication of the value created for investors by new business activity based on the assumptions used and hence the potential of the business. However, the information on embedded value and value of one year’s sales should not be viewed as a substitute of financial measures under the relevant accounting basis. Investors should not make investment decisions based solely on embedded value information and the value of one year’s sales. It is important to note that there is no universal standard which defines the form, calculation methodology or presentation format of the embedded value of an insurance company. Hence, differences in definition, methodology, assumptions, accounting basis and disclosures may cause inconsistency when comparing the results of different companies. Also, the calculation of embedded value and value of one year’s sales involves substantial technical complexity and estimates can vary materially as key assumptions are changed. Therefore, special care is advised when interpreting embedded value results. The values shown below do not consider the future financial impact of transactions between the Company and CLIC, CLI, AMC, Pension Company, CLP&C, and etc. --- # DEFINITIONS OF EMBEDDED VALUE AND VALUE OF ONE YEAR’S SALES The embedded value of a life insurer is defined as the sum of the adjusted net worth and the value of in-force business allowing for the cost of required capital. “Adjusted net worth” is equal to the sum of: - Net assets, defined as assets less corresponding policy liabilities and other liabilities valued; and - Net-of-tax adjustments for relevant differences between the market value and the book value of assets, together with relevant net-of-tax adjustments to certain liabilities. The market value of assets can fluctuate significantly over time due to the impact of the prevailing market environment. Hence the adjusted net worth can fluctuate significantly between valuation dates. The “value of in-force business” and the “value of one year’s sales” are defined here as the discounted value of the projected stream of future shareholders’ interest in distributable earnings for existing in-force business at the valuation date and for one year’s sales in the 12 months immediately preceding the valuation date. The value of in-force business and the value of one year’s sales have been determined using a traditional deterministic discounted cash flow methodology. This methodology makes implicit allowance for all risks that are not considered in valuation process (e.g. risks in accordance with solvency capacity, cash flow adequacy, and business characteristics) and the economic cost of required capital through the use of a risk-adjusted discount rate. ## PREPARATION AND REVIEW The embedded value and the value of one year’s sales were prepared by China Life Insurance Company Limited in accordance with the “CAA Standards of Actuarial Practice: Appraisal of Embedded Value” issued by the China Association of Actuaries (“CAA”). KPMG Advisory (China) Co., Ltd. performed a review of China Life’s embedded value and value of one year’s sales. The review statement is contained in the “Independent Actuaries Review Opinion Report on Embedded Value of China Life Insurance Company Limited” section. ## ASSUMPTIONS **Economic assumptions:** The calculations are based upon assumed corporate tax rate of 25% for all years. The overall investment return of the Company is assumed to be 4% per annum. 20% of the investment return is assumed to be exempt from income tax. The investment return and tax exempt assumptions are based on the Company’s strategic asset mix and expected future returns. Considering the risks associated with different business characteristics, the risk-adjusted discount rate for traditional business is assumed to be 8% per annum, and the risk-adjusted discount rate for semi-priced business is assumed to be 7.2% per annum. Other operating assumptions such as mortality, morbidity, lapses and expenses are based on the Company’s recent operating experience and expected future outlook. --- # SUMMARY OF RESULTS The embedded value as at 31 December 2025, the value of one year’s sales for the 12 months ended 31 December 2025 and the corresponding results as at 31 December 2024 are shown below: ## Components of Embedded Value and Value of One Year’s Sales RMB million | ITEMS | 31 December 2025 | 31 December 2024 | | :--- | :---: | :---: | | A Adjusted Net Worth | 936,673 | 897,831 | | B Value of In-Force Business before Cost of Required Capital | 642,514 | 597,126 | | C Cost of Required Capital | (111,311) | (93,811) | | D Value of In-Force Business after Cost of Required Capital (B + C) | 531,203 | 503,315 | | **E Embedded Value (A + D)** | **1,467,876** | **1,401,146** | | F Value of One Year’s Sales before Cost of Required Capital | 52,950 | 39,587 | | G Cost of Required Capital | (7,198) | (5,878) | | **H Value of One Year’s Sales after Cost of Required Capital (F + G)** | **45,752** | **33,709** | | Including: Value of One Year’s Sales of Individual Agent Channel | 39,299 | 31,313 | The new business margin of one year’s sales of individual agent channel for the 12 months ended 31 December 2025 and for the corresponding period of last year is shown below: ## New Business Margin of One Year’s Sales of Individual Agent Channel | | 31 December 2025 | 31 December 2024 | | :--- | :---: | :---: | | By First Year Premium | 35.0% | 25.7% | | By Annual Premium Equivalent | 36.2% | 26.2% | Note: First Year Premium is the written premium used for calculation of the value of one year’s sales and Annual Premium Equivalent is calculated as the sum of 100 percent of first year regular premiums and 10 percent of single premiums. --- # MOVEMENT ANALYSIS The following analysis tracks the movement of the embedded value from the start to the end of the Reporting Period: ## Analysis of Embedded Value Movement in 2025 | ITEMS | RMB million | |:---|---:| | A Embedded Value at the Start of Year | 1,401,146 | | B Expected Return on Embedded Value | 75,846 | | C Value of New Business in the Period | 45,752 | | D Operating Experience Variance | 888 | | E Investment Experience Variance | 67,348 | | F Methodology, Model and Assumption Changes | (7,363) | | G Market Value and Other Adjustments | (96,175) | | H Exchange Gains or Losses | (144) | | I Shareholder Dividend Distribution and Capital Changes | (19,446) | | J Others | 23 | | **K Embedded Value as at 31 December 2025 (sum A through J)** | **1,467,876** | **Notes:** 1. Numbers may not be additive due to rounding. 2. Items B through J are explained below: - **B** Reflects expected impact of covered business, and the expected return on investments supporting the 2025 opening net worth. - **C** Value of one year's sales for the 12 months ended 31 December 2025. - **D** Reflects the difference between actual operating experience in 2025 (including mortality, morbidity, lapse, expenses, etc.) and the assumptions. - **E** Compares actual with expected investment returns during 2025. - **F** Reflects the effects of appraisal methodology and model enhancement, and assumption changes. - **G** Change in the market value adjustment from the beginning of year 2025 to 31 December 2025 and other adjustments. - **H** Reflects the gains or losses due to changes in exchange rate. - **I** Reflects dividends distributed to shareholders during 2025. - **J** Other miscellaneous items. --- # SENSITIVITY RESULTS Sensitivity tests were performed using a range of alternative assumptions. In each of the sensitivity tests, only the assumption referred to was changed, with all other assumptions remaining unchanged. The results are summarised below: ## Sensitivity Results RMB million | Sensitivity Test Scenario | Value of In-Force Business after Cost of Required Capital | Value of One Year’s Sales after Cost of Required Capital | | :--- | :---: | :---: | | Base case scenario | 531,203 | 45,752 | | 1. Risk discount rate +50bps | 500,099 | 43,462 | | 2. Risk discount rate -50bps | 564,899 | 48,215 | | 3. 10% increase in investment return | 667,974 | 53,296 | | 4. 10% decrease in investment return | 395,087 | 38,228 | | 5. 10% increase in expenses | 522,803 | 42,143 | | 6. 10% decrease in expenses | 539,603 | 49,361 | | 7. 10% increase in mortality rates for non-annuity products and 10% decrease in mortality rates for annuity products | 526,406 | 44,944 | | 8. 10% decrease in mortality rates for non-annuity products and 10% increase in mortality rates for annuity products | 535,961 | 46,565 | | 9. 10% increase in lapse rates | 536,864 | 44,913 | | 10. 10% decrease in lapse rates | 525,374 | 46,640 | | 11. 10% increase in morbidity rates | 521,849 | 43,799 | | 12. 10% decrease in morbidity rates | 540,605 | 47,706 | | 13. Using 2024 EV appraisal assumptions | 533,297 | 47,214 | | 14. Allowing for diversification in calculation of VIF | 565,929 | – | --- # INDEPENDENT ACTUARIES REVIEW OPINION REPORT ON EMBEDDED VALUE OF CHINA LIFE INSURANCE COMPANY LIMITED China Life Insurance Company Limited (“China Life”) has prepared embedded value results as at 31 December 2025 (“EV Results”). The disclosure of these EV Results, together with a description of the methodology and assumptions that have been used, are shown in the Embedded Value section. China Life has retained KPMG Advisory (China) Limited (“KPMG Advisory” or “We”) to review its EV Results. ## Scope of Work Our scope of work covered: - a review of the methodology used to develop the embedded value and value of one year’s sales as at 31 December 2025, in accordance with the “CAA Standards of Actuarial Practice: Appraisal of Embedded Value” issued by CAA; - a review of the economic and operating assumptions used to develop embedded value and value of one year’s sales as at 31 December 2025; and - a review of China Life’s EV Results, including embedded value, value of one year’s sales, analysis of embedded value movement from 31 December 2024 to 31 December 2025, and the sensitivity analysis of value of in-force business and value of one year’s sales. ## Basis of Opinion, Reliance and Limitation We carried out our review work based on the “CAA Standards of Actuarial Practice: Appraisal of Embedded Value”. In carrying out our review, we have relied on the completeness and accuracy of audited and unaudited data and information provided by China Life. The determination of embedded value is based on a range of assumptions on future operations and investment performance. The future actual experiences are affected by internal and external factors, many of which are not entirely controlled by China Life. Hence the future actual experiences may deviate from these assumptions. This report is addressed solely to China Life in accordance with the terms of our engagement letter. To the fullest extent permitted by applicable law, we do not accept or assume any responsibility, duty of care or liability to anyone other than China Life for or in connection with our review work, the opinions we have formed, or for any statements set forth in this report. ## Opinion Based on the scope of work above, we have concluded that: - The embedded value methodology and assumptions used by China Life are in line with the “CAA Standards of Actuarial Practice: Appraisal of Embedded Value” and are consistent with the available market information. This methodology is commonly used by life and health insurance companies in China; - The economic assumptions used by China Life have taken into account the current investment market conditions and the investment strategy of China Life; - The operating assumptions used by China Life have taken into account the past experience and the expectation of future experience; and - The embedded value and related results of China Life are consistent with the methodology and assumptions described in the Embedded Value section. On this basis, the overall results are reasonable. **For and on behalf of** **KPMG Advisory (China) Limited** **Zhenhua Lu, FSA** 25 March 2026 --- # SIGNIFICANT EVENTS ## MATERIAL LITIGATIONS OR ARBITRATIONS During the Reporting Period, the Company was not involved in any material litigation or arbitration. ## MAJOR CONNECTED TRANSACTIONS ### Continuing Connected Transactions During the Reporting Period, the following continuing connected transactions were carried out by the Company under Chapter 14A of the Rules Governing the Listing of Securities on the HKSE (the “Listing Rules”), including the policy management agreement between the Company and CLIC, the insurance sales framework agreement between the Company and CLP&C, the asset management agreement between the Company and AMC, the framework agreement between the Company and China Life Capital, and the framework agreements entered into by China Life AMP with the Company, CLIC and CLI, respectively. These continuing connected transactions were subject to the reporting, announcement and annual review requirements but were exempt from the independent shareholders’ approval requirement under the Listing Rules. CLIC, the controlling shareholder of the Company, holds 60% of the equity interest in CLP&C and 100% of the equity interest in CLI and China Life Capital. Therefore, each of CLIC, CLP&C, CLI and China Life Capital constitutes a connected person of the Company. AMC is held as to 60% and 40% by the Company and CLIC, respectively, and is therefore a connected subsidiary of the Company. China Life AMP is a subsidiary of AMC, and is therefore also a connected subsidiary of the Company. During the Reporting Period, the continuing connected transactions carried out by the Company that were subject to the reporting, announcement, annual review and independent shareholders’ approval requirements under Chapter 14A of the Listing Rules included the agreement for entrusted investment and management and operating services with respect to alternative investments with insurance funds between the Company and CLI. Such agreement and the transactions thereunder have been approved by the independent shareholders of the Company. --- During the Reporting Period, the Company also carried out certain continuing connected transactions, including the asset management agreement between CLIC and AMC, which were exempt from the reporting, announcement, annual review and independent shareholders’ approval requirements under Chapter 14A of the Listing Rules. The Company has complied with the disclosure requirements under Chapter 14A of the Listing Rules in respect of the above continuing connected transactions. When conducting the above continuing connected transactions during the Reporting Period, the Company has followed the pricing policies and guidelines formulated at the time when such transactions were entered into. ## Policy Management Agreement The Company and CLIC entered into the 2025-2027 policy management agreement on 31 December 2024, with a term from 1 January 2025 to 31 December 2027. Pursuant to the agreement, the Company accepted CLIC’s entrustment to provide policy administration services relating to the non-transferred policies, but did not acquire any rights or assume any obligations as an insurer under the non-transferred policies. The calculation method of the service fee equaled to, for each annual payment period, the sum of (1) the number of non-transferred policies in force as of the last day of the period, multiplied by RMB14; and (2) 2.5% of the actual premiums in respect of the non-transferred policies collected during the period. The annual cap in respect of the service fee to be paid by CLIC to the Company for each of the three years ending 31 December 2027 is **RMB503 million**. For the year ended 31 December 2025, the service fee paid by CLIC to the Company amounted to **RMB448.85 million**. ## Insurance Sales Framework Agreement The Company and CLP&C entered into the 2024 insurance sales framework agreement on 23 February 2024, with a term from 8 March 2024 to 7 March 2027. Pursuant to the agreement, CLP&C would entrust the Company to act as an agent to sell selected insurance products within the authorised regions, and pay an agency service fee to the Company in consideration of the services provided. The agency service fee shall be calculated by the parties at a certain percentage of the insurance premiums actually earned from the insurance agency business. The annual caps for the three years ending 31 December 2026 are **RMB2,620 million, RMB2,840 million and RMB3,110 million**, respectively. For the year ended 31 December 2025, CLP&C paid the Company an agency service fee of **RMB1,661.00 million**. ## Asset Management Agreements ### Asset Management Agreement between the Company and AMC The Company and AMC entered into the 2023-2025 asset management agreement on 1 January 2023, with a term from 1 January 2023 to 31 December 2025. Pursuant to the agreement, AMC agreed to invest and manage assets entrusted to it by the Company, on a discretionary basis, within the scope granted by the Company and in accordance with the requirements of applicable laws and regulations, regulatory requirements and the investment guidelines given by the Company. In consideration of AMC’s services in respect of investing and managing various categories of assets entrusted to it by the Company under the agreement, the Company agreed to pay AMC a service fee, including a fixed investment management service fee and a variable management service fee. The fixed investment management service fee was determined based on the type of investment products and the size of assets under management, and the variable management service fee was determined based on the Company’s appraisal of AMC’s investment performance with reference to the standards set out in the investment guidelines. The annual caps for the three years ended 31 December 2025 were **RMB4,000 million, RMB5,000 million and RMB6,000 million**, respectively. The Company and AMC entered into the 2026-2028 asset management agreement on 1 January 2026, with a term from 1 January 2026 to 31 December 2028. Pursuant to the agreement, AMC will continue to invest and manage assets entrusted to it by the Company on a discretionary basis, and will receive a fixed investment management service fee and a variable management service fee in respect thereof. The annual caps for the three years ending 31 December 2028 are **RMB7,000 million, RMB7,500 million and RMB8,000 million**, respectively. For the year ended 31 December 2025, the Company paid AMC a service fee of **RMB4,646.47 million**. --- # Asset Management Agreement between CLIC and AMC CLIC and AMC entered into the 2023-2025 asset management agreement on 29 December 2022, with a term from 1 January 2023 to 31 December 2025. Pursuant to the agreement, AMC agreed to invest and manage assets entrusted to it by CLIC, on a discretionary basis, subject to the investment guidelines and instructions given by CLIC. In consideration of AMC’s services in respect of investing and managing assets entrusted to it by CLIC under the agreement, CLIC agreed to pay AMC a service fee, including a basic service fee and a variable performance-based management fee. The basic service fee was determined based on the type of investment products and the size of assets under management, and the variable performance-based management fee was determined based on CLIC’s appraisal of AMC’s investment performance with reference to the standards set out in the investment guidelines. The annual cap for each of the three years ended 31 December 2025 was RMB500 million. For the year ended 31 December 2025, CLIC paid AMC a service fee of RMB158.16 million. # Agreement for Entrusted Investment and Management and Operating Services with respect to Alternative Investments with Insurance Funds between the Company and CLI As approved by the 2022 Annual General Meeting of the Company, the Company and CLI entered into the 2023-2025 agreement for entrusted investment and management and operating services with respect to alternative investments with insurance funds on 30 June 2023. The agreement was for a term from 1 July 2023 to 31 December 2024, and could be automatically renewed for one year. Pursuant to the agreement, CLI would invest and manage assets entrusted to it by the Company, on a discretionary basis, within the scope of utilisation of insurance funds as specified by the regulatory authorities and in accordance with the investment guidelines of the Company, and the Company would pay CLI the investment management service fee, product management fee, real estate operation management service fee and performance reward in respect of the investment and management services provided by CLI to the Company. The entrusted assets under the agreement included insurance asset management products, financial products, equity/real estate funds and public REITs products (which were mainly conducted by way of strategic fund and restricted to the participation in strategic placement). In addition, CLI would provide the operating services to the Company with respect to the equity/real estate funds invested by the Company at its own discretion and entrusted by it to CLI for operation and management, and the Company would pay CLI the entrusted operation fee in this regard. For the three years ended 31 December 2025, the annual caps on the contractual amount of assets newly entrusted by the Company to CLI for investment and management were RMB120,000 million (or its equivalent in foreign currency), RMB140,000 million (or its equivalent in foreign currency) and RMB150,000 million (or its equivalent in foreign currency), respectively, and the annual caps on the fees for the investment and management services paid by the Company to CLI (including the investment management service fee, product management fee, real estate operation management service fee and performance reward) and the entrusted operation fee in relation to the operating services were RMB1,500 million (or its equivalent in foreign currency), RMB1,800 million (or its equivalent in foreign currency) and RMB2,200 million (or its equivalent in foreign currency), respectively. As approved by the Second Extraordinary Meeting 2025 of the Company, the Company and CLI entered into the 2026-2028 entrusted investment and management agreement for alternative investments with insurance funds on 31 December 2025. The agreement is for a term from 1 January 2026 to 31 December 2028. Pursuant to the agreement, CLI will continue to invest and manage assets entrusted to it by the Company on a discretionary basis, and the Company will pay CLI the investment management service fee, product management fee, real estate operation management service fee and performance reward in respect of the investment and management services provided by CLI to the Company. The entrusted assets under the agreement include insurance asset management products, financial products, equity/real estate funds and public REITs products. For the three years ending 31 December 2028, the annual caps on the contractual amount of assets newly entrusted by the Company to CLI for investment and management are RMB120,000 million (or its equivalent in foreign currency), RMB140,000 million (or its equivalent in foreign currency) and RMB150,000 million (or its equivalent in foreign currency), respectively, and the annual caps on the fees for the investment and management services payable by the Company to CLI (including the investment management service fee, product management fee, real estate operation management service fee and performance reward) are RMB1,100 million (or its equivalent in foreign currency), RMB1,200 million (or its equivalent in foreign currency) and RMB1,300 million (or its equivalent in foreign currency), respectively. --- For the year ended 31 December 2025, the fees for the investment and management services (including the investment management service fee, product management fee, real estate operation management service fee and performance reward) and the entrusted operation fee in relation to the operating services paid by the Company to CLI amounted to RMB665.47 million, and the contractual amount of assets newly entrusted by the Company to CLI for investment and management was RMB56,132.96 million. # Cooperation Framework Agreement for Investment Management with Insurance Funds between the Company and China Life Capital The Company and China Life Capital entered into the 2023-2025 framework agreement on 28 December 2022, with a term from 1 January 2023 to 31 December 2025. Pursuant to the agreement, the Company would subscribe in the capacity of the limited partner for the fund products of which China Life Capital or any of its subsidiaries served (individually and jointly with third parties) as the general partner, and/or the fund products of which China Life Capital served as the manager (including the fund manager and co-manager). For each of the three years ended 31 December 2025, the annual cap for the subscription by the Company in the capacity of the limited partner of the fund products of which China Life Capital or any of its subsidiaries served as the general partner was RMB5,000 million, and the annual cap for the management fee charged by China Life Capital as the general partner or the manager of the fund products was RMB500 million. For the year ended 31 December 2025, the amount of subscription by the Company in the capacity of the limited partner of the fund products of which China Life Capital or any of its subsidiaries served as the general partner was RMB5,000.00 million, and the management fee charged by China Life Capital as the general partner or the manager of the fund products was RMB161.75 million. # Framework Agreements with China Life AMP ## Framework Agreement between the Company and China Life AMP The Company and China Life AMP entered into the 2023-2025 framework agreement on 30 December 2022, with a term from 1 January 2023 to 31 December 2025. Pursuant to the agreement, the Company and China Life AMP would conduct daily transactions, including the subscription and redemption of fund products and private asset management. Pricing of the transactions under the agreement was determined by the parties through arm’s length negotiations with reference to industry practices. For each of the three years ended 31 December 2025, the annual cap of the subscription price and corresponding subscription fee for the subscription of fund products was RMB20,000 million, the annual cap of the redemption price and corresponding redemption fee for the redemption of fund products was RMB20,000 million, and the annual cap of the management fee paid by the Company for the private asset management was RMB700 million. The Company and China Life AMP entered into the 2026-2028 framework agreement on 16 December 2025, with a term from 1 January 2026 to 31 December 2028. Pursuant to the agreement, the Company and China Life AMP will continue to conduct daily transactions, including the subscription and redemption of fund products and private asset management. Pricing of the transactions under the agreement shall be determined by the parties through arm’s length negotiations with reference to industry practices. For each of the three years ending 31 December 2028, the annual cap of the subscription price and corresponding subscription fee for the subscription of fund products is RMB20,000 million, the annual cap of the redemption price and corresponding redemption fee for the redemption of fund products is RMB20,000 million, and the annual cap of the management fee payable by the Company for the private asset management is RMB500 million. For the year ended 31 December 2025, the subscription price and corresponding subscription fee for the subscription of fund products were RMB10,822.00 million. The redemption price and corresponding redemption fee for the redemption of fund products were RMB7,689.52 million. The management fee paid by the Company for the private asset management was RMB11.26 million. ## Framework Agreement between CLIC and China Life AMP CLIC and China Life AMP entered into the 2023-2025 framework agreement on 9 December 2022, with a term from 1 January 2023 to 31 December 2025. Pursuant to the agreement, CLIC would subscribe for or redeem the fund units of the funds managed by China Life AMP, and pay the relevant fees. Pricing of the transactions under the agreement was determined by the parties through arm’s length negotiations with reference to industry practices. For each of the three years ended 31 December 2025, the annual cap of the subscription price and corresponding subscription fee for the subscription of fund products was RMB2,000 million, and the annual cap of the redemption price and corresponding redemption fee for the redemption of fund products was RMB2,000 million. For the year ended 31 December 2025, the subscription price and corresponding subscription fee for the subscription of fund products were RMB0 million. The redemption price and corresponding redemption fee for the redemption of fund products were RMB606.43 million. --- # Framework Agreement between CLI and China Life AMP CLI and China Life AMP entered into the 2023-2025 framework agreement on 29 December 2022, with a term from 1 January 2023 to 31 December 2025. Pursuant to the agreement, CLI and its subsidiaries would conduct daily transactions with China Life AMP, including the subscription and redemption of fund products and private asset management. Pricing of the transactions under the agreement was determined by the parties through arm’s length negotiations with reference to industry practices. For each of the three years ended 31 December 2025, the annual cap of the subscription price and corresponding subscription fee for the subscription of fund products was **RMB2,000 million**, the annual cap of the redemption price and corresponding redemption fee for the redemption of fund products was **RMB2,000 million**, and the annual cap of the management fee paid by CLI and its subsidiaries for the private asset management was **RMB20 million**. As approved by the Second Extraordinary Meeting 2025 of the Company⁴ (⁴ Given that the cumulative transaction amount between the Group (as one party) and CLIC and its subsidiaries (as the other party) over the past twelve months exceeds 5% of the latest audited net assets of the Company, the Company has sought the approval from its shareholders in respect of the transactions under the 2026-2028 framework agreement in accordance with the SSE Listing Rules.), CLI and China Life AMP entered into the 2026-2028 framework agreement on 31 December 2025, with a term from 1 January 2026 to 31 December 2028. Pursuant to the agreement, CLI and its subsidiaries will continue to conduct daily transactions with China Life AMP, including the subscription and redemption of fund products and private asset management. Pricing of the transactions under the agreement shall be determined by the parties through arm’s length negotiations with reference to industry practices. For each of the three years ending 31 December 2028, the annual cap of the subscription price and corresponding subscription fee for the subscription of fund products is **RMB2,000 million**, the annual cap of the redemption price and corresponding redemption fee for the redemption of fund products is **RMB2,000 million**, and the annual cap of the management fee payable by CLI and its subsidiaries for the private asset management is **RMB20 million**. For the year ended 31 December 2025, the subscription price and corresponding subscription fee for the subscription of fund products were **RMB314.47 million**. The redemption price and corresponding redemption fee for the redemption of fund products were **RMB150.50 million**. The management fee paid by CLI and its subsidiaries for the private asset management was **RMB0 million**. # Confirmation by Auditor The Board has received a comfort letter from the auditor of the Company with respect to the above continuing connected transactions which were subject to the reporting, announcement and/or independent shareholders’ approval requirements, and the letter stated that during the Reporting Period: - nothing has come to the auditors’ attention that causes them to believe that the disclosed continuing connected transactions have not been approved by the Company’s Board of Directors; - for transactions involving the provision of goods or services by the Company, nothing has come to the auditors’ attention that causes them to believe that the transactions were not, in all material respects, in accordance with the pricing policies of the Company; - nothing has come to the auditors’ attention that causes them to believe that the transactions were not entered into, in all material respects, in accordance with the relevant agreements governing such transactions; and - nothing has come to the auditors’ attention that causes them to believe that the amounts of the continuing connected transactions have exceeded the total amount of the annual caps set by the Company. # Confirmation by Independent Directors The Company’s Independent Directors have reviewed the above continuing connected transactions which were subject to the reporting, announcement and/or independent shareholders’ approval requirements, and confirmed that: - the transactions were entered into in the ordinary and usual course of business of the Company; - the transactions were conducted on normal commercial terms; - the transactions were entered into in accordance with the agreements governing those continuing connected transactions, and the terms are fair and reasonable and in the interests of shareholders of the Company as a whole; and - the amounts of the above transactions have not exceeded the relevant annual caps. --- # Other Major Connected Transactions ## Formation of Partnership for Investment in Infrastructure Securities Investment Funds The Company, Beijing Shoujing Investment Company Limited and Chasing Jixiang Life Insurance Co., Ltd. (each as a limited partner) entered into a partnership agreement with China Life Properties Investment Management Company Limited (“China Life Properties”) and Beijing Langjia Private Fund Management Co., Ltd. (each as a general partner) and Tianjin Chuangchi Corporate Management Partnership (Limited Partnership) (as the special limited partner) on 23 April 2025 for the formation of Beijing Pingzhun Infrastructure and Real Estate Investment Fund Partnership (Limited Partnership). The total capital contribution by all partners of the partnership shall be RMB5,237,000,000, of which RMB3,500,000,000 shall be contributed by the Company. China Life Capital will serve as the manager of the partnership. The partnership’s investment focuses on the publicly offered infrastructure securities investment funds. ## Formation of Partnership for Equity Investment in Silver Economy Industry The Company, CLP&C, Hebei Linkong Industry Equity Investment Fund Partnership (Limited Partnership), BOC Samsung Life Insurance Company Limited and Chongqing Jiangbei Industry Guiding Private Equity Investment Fund Partnership (Limited Partnership) (each as a limited partner) entered into a partnership agreement with Chengda (Langfang Linkong Free Trade Zone) Investment Management Company Limited (“Langfang Chengda”) (as the general partner) and Chengda Fengtang (Shanghai) Corporate Management Center (Limited Partnership) (as the special limited partner) on 30 June 2025 for the formation of Hebei Chengda Lingkong Equity Investment Fund Partnership (Limited Partnership). The total capital contribution by all partners of the partnership shall be RMB5,000,000,000, of which RMB2,000,000,000 shall be contributed by the Company. China Life Private Equity Investment Company Limited (“CLEI”) will serve as the manager of the partnership. The partnership will primarily undertake equity investments, directly or indirectly (including but not limited to through investment holding vehicles), in unlisted companies that are established or operating in the PRC, or have significant connections to the PRC, with a focus on the silver economy industry chain and related sectors. ## Formation of Partnership for Equity Investment in Nuclear Power Companies The Company, China National Nuclear Power Co., Ltd. and China-Russia Nuclear Industry Cooperation Equity Investment Fund Management (Beijing) Partnership (Limited Partnership) (each as a limited partner) entered into a partnership agreement with Guangzhou Jinhong Asset Management Co., Ltd. (“Guangzhou Jinhong”) and CNNC Industry Fund Management Corporation (each as a general partner) on 26 June 2025 for the formation of CNNP Tianwan (Beijing) Nuclear Power Equity Investment Fund Partnership (Limited Partnership). The total capital contribution by all partners of the partnership shall be RMB1,501,000,000, of which RMB1,200,000,000 shall be contributed by the Company. China Life Jinshi Asset Management Company Limited (“China Life Jinshi”) will serve as the manager of the partnership. The partnership intends to make equity investments, including follow-up investments, in nuclear power companies located in the PRC whose main business is “nuclear power project development, investment, construction and operation”. ## Investment in Equity Investment Plan The Company and China Life Industries Investment Company Limited (“China Life Industries”) intended to contribute RMB2,000,000,000 and RMB10,000,000, respectively, to the CLI – Yuanzhi Fund Equity Investment Plan established by CLI, and separately entered into an entrustment contract with CLI on 15 December 2025 for such purpose. All funds under the equity investment plan will be used for the subscription of limited partnership interest in a partnership established under the laws of the PRC, whose primary investment focus will be on sectors such as semiconductors, digital energy, and smart electric vehicles. ## Increase in Capital Contribution to a Partnership The Company (as the limited partner) and China Life Properties (as the general partner) entered into a supplemental agreement to the partnership agreement on 31 December 2025 to increase the capital contribution of the Company to China Life Qihang Phase I (Tianjin) Equity Investment Fund Partnership (Limited Partnership). Following the increase in the Company’s capital contribution, the total capital contribution by all partners of the partnership will be increased from RMB13,901,000,000 to RMB18,901,000,000, of which the capital contribution by the Company will be increased from RMB13,900,000,000 to RMB18,900,000,000, whereas the capital contribution by China Life Properties will remain unchanged at RMB1,000,000. Of the additional capital contribution to be made by the Company, it is expected that no more than RMB3,300,000,000 will be used to increase capital or provide shareholder loans to Beijing Xingtai Tonggang Real Estate Co., Ltd., so as to meet its funding needs for the development of Project INDIGO II, a flagship commercial complex project located in Dawangjing Business Circle, Beijing. --- Each of China Life Properties, China Life Capital, CLP&C, CLEI, Langfang Chengda, China Life Jinshi, Guangzhou Jinhong and China Life Industries is an associate of CLIC, and therefore a connected person of the Company. The above transactions constituted one-off connected transactions of the Company that were subject to the reporting and announcement requirements but were exempt from the independent shareholders’ approval requirement under Chapter 14A of the Listing Rules. The Company has complied with the disclosure requirement under Chapter 14A of the Listing Rules in respect of such transactions. ## Statement on Claims, Debt Transactions and Guarantees etc. of a Non-operating Nature with Related Parties During the Reporting Period, the Company was not involved in claims, debt transactions or guarantees of a non-operating nature with related parties. # MATERIAL CONTRACTS AND THEIR PERFORMANCE During the Reporting Period, the Company neither acted as trustee, contractor or lessee of other companies’ assets, nor entrusted, contracted or leased its assets to other companies, the profit or loss from which accounted for 10% or more of the Company’s profits for the Reporting Period, nor were there any such matters that occurred in previous periods but subsisted during the Reporting Period. During the Reporting Period, China Life Insurance Company Limited neither gave external guarantees nor provided guarantees to its holding subsidiaries. As at the end of the Reporting Period, the external guarantee balance of the holding subsidiaries of the Company was RMB207 million⁵. ⁵ The guarantee occurred before the company became a holding subsidiary of the Company in 2023, and did not involve the provision of guarantee for the Company's shareholders, effective controller or their related parties. Entrusted investment management during the Reporting Period or any entrusted investment management occurred in previous periods but subsisted during the Reporting Period: Investment is one of the principal businesses of the Company. The Company mainly adopts the mode of entrusted investment for management of its investment assets, and has established a diversified framework of entrusted investment management with China Life’s internal managers playing the key role and the external managers offering effective supports. The internal managers include AMC and its subsidiaries, and CLI and its subsidiaries. The external managers comprise both domestic and overseas managers, including fund companies, securities companies and other professional investment management institutions. The Company selected different investment managers based on the purpose of allocation of various types of investments, their risk features and the expertise of different managers, so as to establish a great variety of investment portfolios and improve the efficiency of insurance fund utilisation. The Company entered into entrusted investment management agreements or asset management contracts with all managers and supervised the managers’ daily investment performance through the measures such as investment guidelines, asset custody and performance appraisals. The Company also adopted risk control measures in respect of specific investments based on the characteristics of different managers and investment products. Except as otherwise disclosed in this report, the Company had no other material contracts during the Reporting Period. # UNDERTAKINGS MADE BY THE PARTIES INCLUDING THE COMPANY’S EFFECTIVE CONTROLLER, SHAREHOLDERS, RELATED PARTIES, ACQUIRERS AND THE COMPANY WHICH ARE EITHER GIVEN OR EFFECTIVE DURING THE REPORTING PERIOD Prior to the listing of the Company’s A Shares (30 November 2006), land use rights were injected by CLIC into the Company during its reorganisation. Out of these, four pieces of land (with a total area of 10,421.12 square meters) had not had its formalities in relation to the change of ownership completed. Further, out of the properties injected into the Company, there were six properties (with a gross floor area of 8,639.76 square meters) in respect of which the formalities in relation to the change of ownership had not been completed. CLIC undertook to assist the Company in completing the above-mentioned formalities within one year of the date of listing of the Company’s A Shares, and in the event that such formalities could not be completed within such period, CLIC would bear any potential losses to the Company due to the defective ownership. --- CLIC strictly followed these commitments. As at the end of the Reporting Period, save for the two properties and related land of the Company’s Shenzhen Branch, the ownership registration formalities of which had not been completed due to historical reasons, all other formalities in relation to the change of land and property ownership had been completed. The Shenzhen Branch of the Company continues to use such properties and land, and no other parties have questioned or hindered the use of such properties and land by the Company. The Company’s Shenzhen Branch and the other co-owners of the properties have issued a letter to the governing department of the original owner of the properties in respect of the confirmation of ownership of the properties, requesting it to report the ownership issue to the State-owned Assets Supervision and Administration Commission of the State Council (“SASAC”), and requesting the SASAC to confirm the respective shares of each co-owner in the properties and to issue written documents in this regard to the department of land and resources of Shenzhen, so as to assist the Company and the other co-owners to complete the formalities in relation to the division of ownership of the properties. Given that the change of ownership of the above two properties and related land use rights were directed by the co-owners, and all formalities in relation to the change of ownership were proceeded slowly due to reasons such as issues rooted in history and government approvals, CLIC, the controlling shareholder of the Company, made further commitment as follows: CLIC will assist the Company in completing, and urge the co-owners to complete, the formalities in relation to the change of ownership in respect of the above two properties and related land use rights as soon as possible. If the formalities cannot be completed due to the reasons of the co-owners, CLIC will take any other legally practicable measures to resolve the issue and will bear any potential losses suffered by the Company as a result of the defective ownership. # ALLEGED VIOLATION OF LAWS AND REGULATIONS BY, PENALTIES IMPOSED ON AND RECTIFICATION OF THE COMPANY AND ITS CONTROLLING SHAREHOLDERS, EFFECTIVE CONTROLLER, DIRECTORS OR SENIOR MANAGEMENT During the Reporting Period, the Company was not investigated for suspected crimes according to law, and none of its controlling shareholders, effective controller, Directors and senior management were subject to any compulsory measures for suspected crimes according to law. The Company or its controlling shareholders, effective controller, Directors and senior management were not subject to any criminal punishment, investigation by the CSRC for alleged violation of laws and regulations, administrative penalty by the CSRC, or material administrative penalty by other competent authorities, nor were they detained by the disciplinary inspection and supervision authorities for alleged serious violation of disciplines or laws or duty-related crimes which had an impact on their performance of duties. None of the Company’s Directors and senior management were subject to any compulsory measures by other competent authorities for alleged violation of laws and regulations which had an impact on their performance of duties. # RESTRICTION ON MAJOR ASSETS The major assets of the Company are financial assets. During the Reporting Period, there was no major asset of the Company being seized, detained or frozen that is subject to the disclosure requirements. # OTHER MATTERS The “Proposal in relation to Abolition of the Board of Supervisors” and the “Proposal in relation to the Amendments to the ‘Articles of Association’” were considered and approved at the First Extraordinary General Meeting 2025 of the Company held on 25 September 2025. The amendments to the Articles of Association have been approved by the NFRA. Upon receiving the approval of the amendments to the Articles of Association, the Company no longer has the Board of Supervisors. The Audit Committee of the Board now exercises the functions and powers of the Board of Supervisors as specified in the Company Law and regulatory rules. All then-serving Supervisors of the Company (including Mr. Cao Weiqing, Mr. Gu Haishan, Ms. Ye Yinglan and Mr. Dong Haifeng) retired on the effective date of the amended Articles of Association. For details, please refer to the announcement published by the Company on 24 December 2025 on the HKExnews website of Hong Kong Exchanges and Clearing Limited. --- # CORPORATE GOVERNANCE ## REPORT OF THE BOARD OF DIRECTORS Directors of the Company during the Reporting Period and up to the date of this report were as follows: | Category | Name | Notes | | :--- | :--- | :--- | | **EXECUTIVE DIRECTORS** | Cai Xiliang (Chairman) | | | | Li Mingguang | | | | Liu Hui | | | | Ruan Qi | | | **NON-EXECUTIVE DIRECTORS** | Hu Jin | | | | Hu Rong | | | | Niu Kailong | appointed on 6 August 2025 | | | Wang Junhui | resigned on 22 January 2026 | | **INDEPENDENT DIRECTORS** | Lam Chi Kuen | | | | Zhai Haitao | | | | Chen Jie | | | | Lu Feng | | | **EMPLOYEE REPRESENTATIVE DIRECTOR** | Li Wei | appointed on 11 March 2026 | --- # PRINCIPAL BUSINESS The Company is a leading life insurance company in China and possesses an extensive distribution network comprising exclusive agents, direct sales representatives, and dedicated and non-dedicated agencies, providing products and services such as individual and group life insurance, accident and health insurance. The Company is one of the largest institutional investors in China, and becomes one of the largest insurance asset management companies in China through its controlling shareholding in AMC. The Company also has controlling shareholding in Pension Company. # BUSINESS REVIEW ## Overall Operation of the Company during the Reporting Period For details of the overall operation of the Company during the Reporting Period, the future development of its business and the principal risks faced by it, please refer to the sections headed "Management Discussion and Analysis" and "Internal Control and Risk Management" in this annual report. These discussions form part of the "Report of the Board of Directors". ## Environmental and Social Responsibilities In pursuit of its strategic goal of "building a world-class and responsible life insurance company" in ESG, the Company further enhanced its sustainability management and actively explored an ESG management model with Chinese characteristics aligned with international standards. The Company's MSCI ESG rating was upgraded to AA, positioning it at the forefront of the life and health insurance industry in the Asia-Pacific region. ### Work on Green Finance The Company has established an ESG and green finance management framework, with the Board assuming primary responsibility. Through specific action plans, it advanced the deep integration of financial services into the building of an ecological civilisation. It continued to develop and roll out insurance services covering renewable energy, green mobility, and energy conservation and environmental protection. In 2025, the net amount at risk under green insurance reached RMB1.82 trillion, strengthening the risk safeguard for the green economy. The Company further optimised its asset allocation structure, actively guided asset managers to accelerate the deployment of green investments, and built positions across wind, hydro, photovoltaic power and environmental protection, with a focus on driving steady growth in green assets and consolidating its leading edge, thereby supporting the development of the national green economy and industrial upgrading on an all-round basis. Huadian New Energy, an earlier strategic investment, was listed on the Main Board of the SSE in 2025, becoming the largest IPO in the A-share market of that year and demonstrating the achievements of the Company's forward-looking deployment. ### Work on Low-carbon Operation The Company has systematically established a four-dimensional climate response mechanism — governance structure, strategic planning, risk management, and metrics and targets — and coordinated the low-carbon transition across its operations to support the development of a climate-resilient society. It advanced its climate actions through three pathways: innovating insurance products and services, optimising operations and guiding investments. The Company completed its inaugural climate stress test, and effectively translated low-carbon concepts into routine practices in daily operations. In 2025, the paperless insurance application rate for individual long-term insurance policies reached 99.9%, and 1.79 million electronic policies were issued, enabling customers to access and download their electronic policies online at any time and saving more than 234 tonnes of paper. ### Work on Social Responsibility Rooted in the needs of people's livelihoods and leveraging its strengths on principal business, the Company expanded the reach of inclusive insurance and improved the quality and efficiency of services, reinforcing the foundation of livelihood protection. In 2025, the Company further enriched its product supply system. By focusing on key groups including the "new industry practitioners and new urban residents", micro and small enterprises and rural populations, it developed more than 20 specialised products through innovation. It continued to advance government-sponsored health insurance business, such as supplementary major medical expenses insurance. The Company undertook over 200 supplementary major medical expenses insurance programs and over 70 long-term care insurance programs, effectively easing people's medical and care burdens. Deepening its presence in senior-care services sector, the Company built a diversified senior-care service supply system and rolled out 20 residential senior-care service projects in a total of 16 cities. It stepped up its social welfare initiatives and fulfilled its social responsibilities. In 2025, it donated RMB26 million to the China Life Foundation, and partnered with the China Women and Children's Foundation (中國婦女兒童基金會) to launch the "Health + Safeguard Home" public welfare program, aiming at strengthening the foundations of healthy families. It also encouraged employees to actively participate in volunteer service activities, organising more than 350 youth volunteer service teams and mobilising over 3,000 volunteers to deliver more than 40,000 public-welfare service engagements. --- # Specific Work on Consolidation of Achievements in Poverty Alleviation and Rural Revitalisation Undertakings In 2025, the Company strengthened its corporate responsibility, and continued to improve its long-term mechanism for assistance, so as to make every effort to enhance the quality and efficiency of finance and insurance serving rural revitalisation. The Company dispatched 1,020 cadres staying at villages for assistance, and undertook assistance work in 1,085 assistance localities. It purchased over RMB31 million of agricultural products under consumption-based assistance over the year, helping farmers to improve both production and income. The Company made substantial efforts to develop its insurance business in response to the demand from rural residents for diversified insurance protection. It offered risk protection of RMB30 trillion for 242 million rural residents within the year, with the claims payment of RMB38 billion made to 18 million people. The Company developed two new products in the rural revitalisation series, bringing the total to 23 products under the series, thereby providing multi-tier insurance protection and helping guard against the bottom line of poverty. The Company learned and practiced the experience acquired from "Ten Million Projects", and strived to make innovation in assistance measures, so as to enhance the effectiveness of assistance initiatives and facilitate rural revitalisation in all aspects. ## Compliance by the Company with the Relevant Laws and Regulations that have a Significant Impact The Company adhered to the code of conduct of "**being trustworthy, assuming risks, emphasising on services and being legal compliant**" and promoted the compliance culture and concepts of "**all employees being compliant on a proactive basis, and creating value from compliance**", thereby creating the compliance environment of "**starting from the top level and having responsibility for all to be compliant**". The Company strictly observed and effectively implemented applicable laws and regulations and regulatory requirements, such as the Insurance Law, the Company Law, the Securities Law, the "Consumer Rights Protection Law", the "Personal Information Protection Law", the "Anti-Money Laundering Law", the "Anti-Unfair Competition Law", the "Regulations on Preventing and Dealing with Illegal Fund-raising", the "Provisions on the Administration of Insurance Companies", the "Measures for the Compliance Management of Financial Institutions", the "Measures for the Administration of the Utilisation of Insurance Funds", the "Standards for the Corporate Governance of Banking and Insurance Institutions", the "Provisions on the Administration of Solvency of Insurance Companies", the "Measures for the Administration of Connected Transactions of Banking and Insurance Institutions", the "Measures for the Administration of Banking and Insurance Supervision and Statistics", the "Measures for the Administration of Operational Risks of Banking and Insurance Institutions", the "Measures for the Administration of Insurance Sales", and the "Measures for the Administration of Criminal Cases Involving Financial Institutions", consistently improved its systems and mechanisms, and stringently implemented the spirit and requirements of major regulatory documents on insurance product development and design, information disclosure, sales management, insurance agents management, protection of consumers' rights and interests and customers' information, corporate governance, compliance management, fund utilisation, solvency management, connected transactions management, reinsurance management, data governance, anti-money laundering, and criminal case management, etc., as released by the NFRA, for the purpose of establishing and optimising its compliance management system. The Company also consolidated its foundation in all aspects for its steady and healthy development and firmly held on to the bottom line of the systematic risk, which guaranteed the healthy and high-quality development of the Company on an ongoing basis. ## Relationship between the Company and its Customers Being customer-centric all along, the Company was committed to offering high-quality services to customers and provided insurance services and value-added services for more than 600 million customers on a cumulative basis⁶. ⁶ (The cumulative number of customers served refers to policyholders and insured customers under all individual insurance policies underwritten by the Company, including terminated individual insurance policies, but excluding group insurance policies and group retained business insurance policies. Where the policyholder and the insured customer are the same person, they are counted as a single customer.) The Company placed significant emphasis on the protection of consumers' rights and interests, embedding such concept across the organisation and deepening a full-chain consumer rights protection work system that covers the phases before during and after events. It continued to refine the development of the systems and mechanisms for the protection of consumers' rights and interests, strengthened the management measures for the protection of consumers' rights and interests, and advanced the in-depth operation of various mechanisms for the protection of consumers' rights and interests, such as consumer rights protection reviews, suitability management, consumer information disclosure, customer information protection, and financial education, etc., with an aim to further consolidate a "comprehensive consumer protection" paradigm. In 2025, the number of consumers participating in the Company's educational and promotional activities increased by 31.4% year on year. Please also refer to the "Customer Services" in the section headed "Management Discussion and Analysis" in this annual report. --- # Relationship between the Company and its Employees The Company created a harmonious labour relationship according to law and entered into employment contracts with its employees in a timely manner. It strengthened the management of employees in all aspects by establishing the following mechanisms: an employee management mechanism with the characteristics of focus on grassroots, combination of training and working of employees, hierarchical responsibilities and unified standards; a performance management mechanism that was strategy-based and results-oriented, adopted hierarchical classification, and focused on application; and a remuneration distribution mechanism that was based on the principles of salary determined by position, remuneration paid based on performance, emphasis on incentives and preference for grassroots, and was compatible with the high-quality development requirements of the Company. The Company also emphasised on the cultivation and development of employees. Aimed at management cadres, professional talents, young cadres and new employees, it continued to refine a "four-in-one" talent education and training system, pursued classification of employees for training with an equal emphasis on full coverage, integrated cultivation and training throughout the growth process of cadres and employees, which consistently empowered organisation development and individual progression. The Company attached importance to humanistic concern by constantly improving the mechanism for communication with employees, safeguarding the legitimate rights and interests of employees in a practical manner and encouraging employees to arrange vacations and annual leave in a scientific way, with an aim to achieve work-life balance. The Company consistently valued the rights and interests of employees by actively promoting the construction of a corporate democratic management system with employee representative meetings as the fundamental form to protect the democratic rights of employees and facilitate joint development between employees and the Company. The Company and its provincial branches have comprehensively established the system of employee representative meetings, safeguarding all meeting rights according to law and consistently following up on the implementation of resolutions to effectively oversee the handling of proposals. At the first meeting of the fourth session of the employee representative meeting, 15 proposals were submitted, covering areas such as corporate management, employee development and welfare benefits, with all 15 implemented, achieving an implementation rate of 100%. Pursuant to the "Trade Union Law", the "Constitution of the All China Federation of Trade Unions", the "Regulations on the Election of Grassroots Trade Union" and the provisions and requirements of higher-level trade unions, the Company convened the second, third and fourth meetings of the fourth session of the employee representative meeting on 28 May 2025 (with 210 employee representatives in attendance), 26 November 2025 (with 212 employee representatives in attendance) and 26 December 2025 (with 213 employee representatives in attendance), respectively. During these three meetings, representatives diligently performed their duties and, in aggregate, listened to and reviewed nine proposals covering multiple areas, including corporate governance, business operations and management, risk prevention and control, and employee development, which fully demonstrated the important role of employee representative meetings in corporate democratic management. For details regarding the Company's employees (including the number of employees, professional composition, education levels, employee diversity, remuneration policy and training plans), please refer to the section headed "Directors, Senior Management and Employees" in this annual report. For information during the Reporting Period such as the environmental and social responsibilities of the Company, the relationship between the Company and its customers, and the relationship between the Company and its employees, please also refer to the full text of the 2025 Environmental, Social and Governance & Social Responsibility Report separately disclosed by the Company on the website of the SSE (www.sse.com.cn) and the HKExnews website of Hong Kong Exchanges and Clearing Limited (www.hkexnews.hk) simultaneously. # FORMULATION AND IMPLEMENTATION OF PROFIT DISTRIBUTION POLICY **In accordance with Article 177 of the Articles of Association, the Basic Principles of the Company’s Profit Distribution Policy are as follows:** - The Company shall take the investment return for investors into full account and allocate the required percentage of the Company’s realised distributable profits to shareholders as dividends each year; - The Company shall maintain a sustainable and steady profit distribution policy and at the same time take into consideration the general interest of all the shareholders and the sustainable development of the Company; - The Company shall give priority to cash dividends as its profit distribution manner. **In accordance with Article 178 of the Articles of Association, the Company’s Profit Distribution Policy is as follows:** - Profit distribution modes: The Company may distribute dividends in the form of cash or shares or a combination of cash and shares. If practicable, the Company may distribute interim dividends. The Company’s dividends shall not bear interest, save in the case where the Company fails to distribute the dividends to the shareholders on the day when dividends were due to have been distributed. --- - **Specific conditions for and proportion for the Company’s cash dividend distribution**: If the Company makes profits in a given year and the cumulative undistributed profit is positive, the Company shall distribute dividends in the form of cash and the cumulative profits distributed in cash over the past three years by the Company shall be no less than thirty percent (30%) of the Company’s average annual distributable profits realised over the past three years. The specific ratio of cash dividend distribution of the Company will be determined by taking into full consideration of factors such as profitability, solvency adequacy and the need of the Company’s sustainable development. If the Company’s solvency adequacy does not meet the regulatory requirements, the Company shall not distribute profits to its shareholders. - **Specific conditions for distribution of share dividends**: If the Company’s operation is sound and the Board of Directors is of the opinion that share dividends distribution is in the interest of all of the Company’s shareholders because the Company’s stock price does not match the Company’s share capital, the Company may propose a share dividends distribution plan if the conditions for cash dividends listed above are satisfied. After the resolution is made by the shareholders’ general meeting of the Company on the profit distribution proposal, or after the Board of Directors of the Company formulates a specific proposal based on the conditions and cap for the interim dividend distribution for the next year as approved by the shareholders’ general meeting, the distribution of dividends (or shares) shall be completed within two months. ## In accordance with Article 179 of the Articles of Association, the Procedures of Reviewing the Company’s Profit Distribution Proposal are as follows: The Company’s annual profit distribution proposal shall be fully discussed by the Board of Directors of the Company with respect to the reasonableness of the proposal. After a special resolution regarding the proposal is reached and independent opinions have been given by the Independent Directors, the proposal shall be submitted to the shareholders’ general meeting for approval. When deliberating on specific cash dividend proposal by the shareholders’ general meeting, the Company shall make active communication with shareholders, especially small- and medium-sized shareholders, through various channels. The Company shall also fully solicit opinions and appeals from shareholders, and give timely reply to concerns of small- and medium-sized shareholders. When the shareholders’ general meeting reviews the annual profit distribution proposal, it may review and approve the conditions for distribution of interim cash dividends for the next year, cap on distribution proportion and cap on distribution amount. The cap on dividend distribution shall not exceed the net profit attributable to equity holders of the Company for the corresponding period. The Board of Directors shall formulate a specific interim dividend distribution proposal based on the resolution of the shareholders’ general meeting and under the conditions that meet profit distribution. ## Profit Distribution Plan or Public Reserves Capitalisation Plan for the Year 2025 and the Distribution of Cash Dividends for the Recent Three Fiscal Years According to the 2025 interim profit distribution plan approved at the Second Extraordinary General Meeting 2025 held on 25 September 2025, based on 28,264,705,000 shares in issue, the Company has distributed 2025 interim cash dividends of RMB0.238 per share (inclusive of tax) to all shareholders of the Company, totalling approximately RMB6,727 million. In accordance with the profit distribution plan for the year 2025 approved by the twenty-fifth meeting of the eighth session of the Board held on 25 March 2026, based on 28,264,705,000 shares in issue, the Company proposed to distribute 2025 final cash dividends of RMB0.618 per share (inclusive of tax) to all shareholders of the Company, totalling approximately RMB17,468 million. The foregoing profit distribution plan is subject to the approval by the 2025 Annual General Meeting. If the Company’s profit distribution plan for the year 2025 is approved, together with the 2025 interim cash dividends distributed by the Company, annual cash dividends in 2025 will be RMB0.856 per share (inclusive of tax), totalling approximately RMB24,195 million, representing 16% of the net profit attributable to equity holders of the Company in the consolidated statements. Dividends payable to domestic shareholders are denominated and declared in RMB and paid in RMB. Dividends payable to shareholders of the Company’s overseas-listed foreign-invested shares are denominated and declared in RMB and paid in the currency of the jurisdiction in which the overseas-listed foreign-invested shares are listed or RMB. The Company may provide shareholders of the overseas-listed foreign-invested shares with the option to receive dividends in either the currency of the jurisdiction in which the overseas-listed foreign-invested shares are listed or RMB. When the Company pays dividends to shareholders of overseas-listed foreign-invested shares in the currency of the jurisdiction in which the overseas-listed foreign-invested shares are listed, it shall comply with the relevant foreign-invested exchange control regulations of the PRC. If there are no specific regulations, the applicable exchange rate shall be the average closing rate for the relevant foreign currency as announced by the People’s Bank of China during the week prior to the announcement of the distribution of dividends. No public reserve capitalisation is provided for in the profit distribution plan for the year. --- The profit distribution policy of the Company complied with the Articles of Association and the examination and approval procedures of the Company. It clearly defined the dividend distribution standards and percentages, with comprehensive decision-making procedures and system. Small- and medium-sized shareholders of the Company have sufficient opportunities to express their opinions and appeals, and their legitimate rights have been well protected. The Independent Directors diligently considered the profit distribution policy and expressed their independent opinions in this regard. The distribution of cash dividends for the recent three fiscal years: | | RMB million | | :--- | :--- | | Cumulative amount of cash dividends for the recent three fiscal years (inclusive of tax) (1) | 54,721 | | Cumulative amount of repurchases and cancellation for the recent three fiscal years (2) | - | | Cumulative amount of cash dividends and repurchases and cancellations for the recent three fiscal years (3)=(1)+(2) | 54,721 | | Average annual net profit attributable to equity holders of the Company for the recent three fiscal years (4) | 94,041 | | Cash dividend ratio for the recent three fiscal years (%) (5)=(3)/(4) | 58 | | Net profit attributable to equity holders of the Company in the consolidated statements for the most recent fiscal year | 154,078 | | Undistributed profits at the end of the year in the statements of the Company for the most recent fiscal year | 477,946 | ## DISTRIBUTABLE RESERVES As at 31 December 2025, the distributable reserves of the Company was RMB477,946 million. ## PROPERTY, PLANT AND EQUIPMENT Details of the movement in property, plant and equipment of the Company are set out in Note 7 in the Notes to the Consolidated Financial Statements in this annual report. ## SHARE CAPITAL Details of the movement in share capital of the Company are set out in Note 32 in the Notes to the Consolidated Financial Statements in this annual report. ## MANAGEMENT CONTRACTS No management or administration contracts for the whole or substantial part of any business of the Company were entered into during the Reporting Period. ## PENSION PLAN Full-time employees of the Company are covered by various government-sponsored pension plans, under which the employees are entitled to a monthly pension based on certain formulae. These government agencies are responsible for the pension liability to these employees upon retirement. The Company contributes on a monthly basis to these pension plans for full-time employees. All contributions made under the government-sponsored pension plans described above are fully attributable to employees of the Company at the time of the payment and the Company is unable to forfeit any amounts contributed by it to such plans. In addition to the government-sponsored pension plans, the Company established an employee annuity fund plan pursuant to the relevant laws and regulations in the PRC, whereby the Company is required to contribute to the plan at fixed rates of the employees' salary costs. Contributions made by the Company under the annuity fund plan that is forfeited in respect of those employees who resign from their positions prior to the full vesting of the contributions will be recorded in the public account of the annuity fund and shall not be used to offset any contributions to be made by the Company in the future. All funds in the public account will be attributed to the employees whose accounts are in normal status after the approval procedures are completed as required. Under these plans, the Company has no legal or constructive obligation for retirement benefit beyond the contributions made. ## INTEREST-BEARING LOANS AND OTHER BORROWINGS As at the end of the Reporting Period, the Company had a fixed-rate bank loan of RMB50 million, with a maturity date in December 2027. ## CHARITABLE DONATIONS The total amount of charitable donations made by the Company during the Reporting Period was approximately RMB27 million. ## INFORMATION OF TAX DEDUCTION FOR HOLDERS OF LISTED SECURITIES Shareholders of the Company are taxed and/or enjoy tax relief for the dividend income received from the Company in accordance with the "Individual Income Tax Law of the People's Republic of China", the "Enterprise Income Tax Law of the People's Republic of China", and relevant administrative rules, governmental regulations and regulatory documents. Please refer to the announcements published by the Company on the website of the SSE on 4 July 2025 and 13 October 2025 for the information on income tax in respect of the dividend distributed to A Share shareholders during the Reporting Period, and the announcements published by the Company on the HKExnews website of Hong Kong Exchanges and Clearing Limited on 26 June 2025 and 25 September 2025 for the information on income tax in respect of the dividend distributed to H Share shareholders during the Reporting Period. --- # PURCHASE, SALE OR REDEMPTION OF THE COMPANY’S SECURITIES During the Reporting Period, the Company and its subsidiaries did not purchase, sell or redeem any of the Company’s listed securities (including the sale of treasury shares). As at the end of the Reporting Period, the Company did not hold any treasury shares. # H SHARE STOCK APPRECIATION RIGHTS No H Share stock appreciation rights of the Company were granted or exercised in 2025. The Company will deal with such rights and related matters in accordance with the PRC governmental policies. # DAY-TO-DAY OPERATIONS OF THE BOARD Details of the Board meetings and the Board’s performance of its duties during the Reporting Period are set out in the section headed “Report of Corporate Governance” in this annual report. # DIRECTORS’ AND FORMER SUPERVISORS’ SERVICE CONTRACTS None of the Directors or the former Supervisors has entered into any service contracts with the Company and its subsidiaries that are not terminable within one year or can only be terminated by the Company with payment of compensation (other than statutory compensation). # INTERESTS OF DIRECTORS AND FORMER SUPERVISORS (AND THEIR CONNECTED ENTITIES) IN MATERIAL TRANSACTIONS, ARRANGEMENTS OR CONTRACTS None of the Directors or the former Supervisors (and their connected entities) is or was materially interested, directly or indirectly, in any transaction, arrangement or contract of significance entered into by the Company or its controlling shareholders or any of their respective subsidiaries at any time during the Reporting Period or subsisted at the end of the Reporting Period. # DIRECTORS’ AND FORMER SUPERVISORS’ RIGHTS TO ACQUIRE SHARES No arrangements to which the Company, any of its subsidiaries or holding companies, or any subsidiary of the Company’s holding companies is a party, and whose objects are, or one of whose objects is, to enable Directors or Supervisors (including their spouses and children under the age of 18) to acquire benefits by means of the acquisition of shares in, or debentures of, the Company or any other body corporate, subsisted at any time during the Reporting Period or at the end of the Reporting Period. # DISCLOSURE OF INTERESTS OF DIRECTORS, FORMER SUPERVISORS AND THE CHIEF EXECUTIVE IN THE SHARES OF THE COMPANY As at the end of the Reporting Period, none of the Directors, the former Supervisors and the chief executive of the Company had any interests or short positions in the shares, underlying shares or debentures of the Company or its associated corporations (within the meaning of Part XV of the Securities and Futures Ordinance (the “SFO”)) as recorded in the register required to be kept by the Company pursuant to Section 352 of the SFO or which had to be notified to the Company and the HKSE pursuant to the Model Code for Securities Transactions by Directors of Listed Issuers (the “Model Code”) as set out in Appendix C3 to the Listing Rules. # COMPLIANCE WITH THE CODE FOR SECURITIES TRANSACTIONS BY DIRECTORS AND FORMER SUPERVISORS OF THE COMPANY The Board has established written guidelines on no less exacting terms than the Model Code for Directors and former Supervisors of the Company in respect of their dealings in the securities of the Company. After making specific inquiries to all the Directors and the former Supervisors of the Company, they confirmed that they had complied with the Model Code and the Company’s own guidelines during the Reporting Period. # PERMITTED INDEMNITY PROVISION The Company made appropriate insurance arrangement with respect to legal actions that might be faced by its Directors in connection with corporate activities, and such insurance arrangement was in force during the Reporting Period and up to the date of this report. # PRE-EMPTIVE RIGHTS AND ARRANGEMENTS FOR SHARE OPTIONS AND SHARE AWARDS According to the Articles of Association and relevant PRC laws, there is no provision for any pre-emptive rights of the shareholders of the Company. At present, the Company does not have any arrangements for share options or share awards. # RESPONSIBILITY STATEMENT OF DIRECTORS ON FINANCIAL REPORTS The Directors are responsible for overseeing the preparation of the financial report for each financial period which gives a true and fair view of the Company’s financial position, performance results and cash flows for that period. To the best knowledge of the Directors, there was no event or condition during the Reporting Period that might have a material adverse effect on the continuing operation of the Company. --- # BOARD’S STATEMENT ON INTERNAL CONTROL In accordance with the requirements of the “Standard Regulations on Corporate Internal Control”, the Board conducted an assessment on internal control relating to the Company’s financial reporting functions, and confirmed that its internal control was effective as at 31 December 2025. # MAJOR CUSTOMERS In 2025, the gross written premiums received from the Company’s five largest customers accounted for less than 5% of the Company’s gross written premiums for the year. There is no related party of the Company among the five largest customers. # SUFFICIENCY OF PUBLIC FLOAT Based on the information publicly available to the Company and within the knowledge of the Directors as at the latest practicable date (25 March 2026), the H Shares of the Company held by the public represent at least 5% of the total number of issued shares of the Company. Accordingly, the Company’s public float complies with the requirements of minimum public float under the Listing Rules. # AUDITORS PricewaterhouseCoopers Zhong Tian LLP and PricewaterhouseCoopers, the PRC and overseas auditors of the Company for the year 2023, retired as the auditors of the Company upon conclusion of the 2023 Annual General Meeting. As approved by the 2024 Annual General Meeting of the Company, Ernst & Young Hua Ming LLP and Ernst & Young (the two aforesaid auditors are collectively referred to as “EY”) have been appointed as the PRC and overseas auditors of the Company for the year 2025, who will hold office until the conclusion of the 2025 Annual General Meeting. EY has served as the Company’s auditors for two years. Remuneration paid by the Company to the auditors is subject to the approval at the shareholders’ general meeting, pursuant to which the Board is authorised to determine the amount and make payment. Audit fees paid by the Company to the auditors will not affect the independence of the auditors. Remuneration paid by the Company to EY in 2025 was as follows: (Unit: RMB million) | Service/Nature | Fees | | :--- | :--- | | Audit, review and agreed-upon procedures fee | 53.28 | | Including: Internal control audit fee | 8.00 | | Non-audit services fee (tax services and consultation services) | 3.49 | | **Total** | **56.77** | The Board will submit the proposal on the 2025 Annual General Meeting to be held on 25 June 2026 to re-appoint EY as the PRC and overseas auditors of the Company for the year 2026. By Order of the Board **Cai Xiliang** *Chairman* 25 March 2026 --- # CHANGES IN ORDINARY SHARES AND SHAREHOLDERS INFORMATION ## CHANGES IN SHARE CAPITAL During the Reporting Period, there was no change in the total number of shares and the share capital structure of the Company. ## ISSUE AND LISTING OF SECURITIES As at the end of the Reporting Period, the Company had not issued any securities in the last three years. During the Reporting Period, there was no change in the total number of shares and the share structure of the Company due to bonus issues or placings, nor were there any internal employees’ shares. ## INFORMATION ON SHAREHOLDERS AND EFFECTIVE CONTROLLER ### Total Number of Shareholders and their Shareholdings | Shareholder Type | As at the end of the Reporting Period | As at the end of the month prior to the disclosure of the annual report | | :--- | :--- | :--- | | No. of A Share shareholders | 75,803 | 85,197 | | No. of H Share shareholders | 22,040 | 21,584 | ### Particulars of Top Ten Shareholders of the Company Unit: Shares | Name of shareholder | Nature of shareholder | Percentage of shareholding | Number of shares held as at the end of the Reporting Period | Increase/ Decrease during the Reporting Period | Number of shares subject to selling restrictions | Number of shares pledged or frozen | | :--- | :--- | :--- | :--- | :--- | :--- | :--- | | China Life Insurance (Group) Company | State-owned legal person | 68.37% | 19,323,530,000 | — | — | — | | HKSCC Nominees Limited | Overseas legal person | 25.97% | 7,341,315,886 | +10,087,410 | — | — | | China Securities Finance Corporation Limited | State-owned legal person | 2.51% | 708,240,246 | — | — | — | | Central Huijin Asset Management Limited | State-owned legal person | 0.41% | 117,165,585 | — | — | — | | Hong Kong Securities Clearing Company Limited | Overseas legal person | 0.14% | 39,395,707 | -43,077,898 | — | — | | Industrial and Commercial Bank of China Limited – SSE 50 Exchange Traded Index Securities Investment Fund | Other | 0.11% | 30,806,370 | -496,300 | — | — | | Industrial and Commercial Bank of China Limited – Huatai-PineBridge CSI 300 Exchange Traded Index Securities Investment Fund | Other | 0.10% | 27,484,317 | -1,261,117 | — | — | | China Construction Bank Corporation – E Fund CSI 300 Exchange Traded Index Initiative Securities Investment Fund | Other | 0.07% | 19,624,147 | -212,600 | — | — | | Industrial and Commercial Bank of China Limited – Huaxia CSI 300 Exchange Traded Index Securities Investment Fund | Other | 0.05% | 14,976,165 | +1,789,500 | — | — | | National Social Security Fund Portfolio 114 | Other | 0.05% | 14,089,600 | +1,089,600 | — | — | --- # Notes: 1. HKSCC Nominees Limited is a company that holds shares on behalf of the clients of the Hong Kong stock brokers and other participants of the CCASS system. The relevant regulations of the HKSE do not require such persons to declare whether their shareholdings are pledged or frozen. Hence, HKSCC Nominees Limited is unable to calculate or provide the number of shares that are pledged or frozen. 2. Industrial and Commercial Bank of China Limited – SSE 50 Exchange Traded Index Securities Investment Fund, Industrial and Commercial Bank of China Limited – Huatai-PineBridge CSI 300 Exchange Traded Index Securities Investment Fund and Industrial and Commercial Bank of China Limited – Huaxia CSI 300 Exchange Traded Index Securities Investment Fund have Industrial and Commercial Bank of China Limited as their fund depositary. Save as above, the Company was not aware of any connected relationship and concerted parties as defined by the “Measures for the Administration of the Takeover of Listed Companies” among the top ten shareholders of the Company. 3. As at the end of the Reporting Period, except for the unknown situation regarding HKSCC Nominees Limited, none of the other shareholders of the Company as described above have lent their shares through refinancing. # Information relating to the Controlling Shareholder and Effective Controller The controlling shareholder of the Company is CLIC, and its relevant information is set out below: | Field | Details | | :--- | :--- | | **Name of company** | China Life Insurance (Group) Company | | **Legal representative** | Cai Xiliang | | **Date of incorporation** | 22 August 1996 (CLIC’s predecessor was PICC (Life) Co., Ltd. incorporated in August 1996. It was renamed as China Life Insurance Company, a company approved for formation by the State Council in January 1999. With the approval of the former China Insurance Regulatory Commission in 2003, China Life Insurance Company was restructured as CLIC.) | | **Major businesses** | Insurance services including receipt of premiums and payment of benefits in respect of the in-force life, health, accident and other types of personal insurance business, and the reinsurance business; holding or investing in domestic and overseas insurance companies or other financial insurance institutions; funds application business permitted by PRC laws and regulations or approved by the State Council of the PRC; other businesses approved by insurance regulatory agencies. | | **Shareholdings in other subsidiaries and affiliates listed in China or abroad during the Reporting Period** | As at 31 December 2025, CLIC held 1,785,098,644 H shares of Town Health International Medical Group Limited (which is one of the companies listed in China or abroad in which CLIC has over 5% of the total share capital), representing 26.35% of its total shares. | The effective controller of the Company is the Ministry of Finance. The equity and controlling relationship between the Company and its effective controller is set out as below: ## Equity and Controlling Relationship | Shareholder | Investee | Percentage | | :--- | :--- | :--- | | Ministry of Finance of the PRC | China Life Insurance (Group) Company | 90% | | National Council for Social Security Fund | China Life Insurance (Group) Company | 10% | | China Life Insurance (Group) Company | China Life Insurance Company Limited | 68.37% | During the Reporting Period, there was no change to the controlling shareholder and the effective controller of the Company. As at the end of the Reporting Period, there was no other corporate shareholder holding more than 10% of the shares in the Company. --- # INTERESTS AND SHORT POSITIONS IN THE SHARES AND UNDERLYING SHARES OF THE COMPANY HELD BY SUBSTANTIAL SHAREHOLDERS AND OTHER PERSONS UNDER HONG KONG LAWS AND REGULATIONS So far as is known to the Directors and the chief executive of the Company, as at 31 December 2025, the following persons (other than the Directors and the chief executive of the Company) had interests or short positions in the shares or underlying shares of the Company which would fall to be disclosed to the Company under the provisions of Divisions 2 and 3 of Part XV of the SFO, or which were recorded in the register required to be kept by the Company pursuant to Section 336 of the SFO, or as otherwise notified to the Company and the HKSE: | Name of substantial shareholder | Capacity | Class of shares | Number of shares held | Percentage of the respective class of shares | Percentage of the total number of shares in issue | | :--- | :--- | :--- | :--- | :--- | :--- | | China Life Insurance (Group) Company | Beneficial owner | A Shares | 19,323,530,000 (L) | 92.80% | 68.37% | | Ping An Insurance (Group) Company of China, Ltd. (Note 1) | Interest in controlled corporation | H Shares | 619,338,000 (L) | 8.32% | 2.19% | | Ping An Asset Management Co., Ltd. | Investment Manager | H Shares | 606,699,000 (L) | 8.15% | 2.15% | | BlackRock, Inc. (Note 2) | Interest in controlled corporation | H Shares | 479,549,185 (L)
1,817,000 (S) | 6.44%
0.02% | 1.70%
0.01% | | FMR LLC (Note 3) | Interest in controlled corporation | H Shares | 438,552,769 (L) | 5.89% | 1.55% | The letter "L" denotes a long position. The letter "S" denotes a short position. **(Note 1):** Ping An Insurance (Group) Company of China Ltd. ("Ping An Group") was interested in a total of 619,338,000 H shares of the Company in accordance with the provisions of Part XV of the SFO. Of these shares, Ping An Life Insurance Company of China, Ltd. and Ping An Annuity Insurance of China, Ltd. were interested in 605,567,000 H shares and 13,771,000 H shares, respectively. All of these entities are subsidiaries of Ping An Group. Ping An Asset Management Co., Ltd. ("Ping An Asset Management") was interested in 606,699,000 H shares, which were held by Ping An Asset Management on behalf of certain customers (including but not limited to subsidiaries of Ping An Group) in its capacity as investment manager. Ping An Asset Management is a subsidiary of Ping An Group. As Ping An Asset Management is in a position to fully exercise the voting rights in respect of such shares on behalf of customers and independently exercise the rights of investment and business management in its capacity as investment manager, Ping An Group is exempted from disclosure of interests in shares held by Ping An Asset Management that are not held by Ping An Group, as a holding company in accordance with the SFO. **(Note 2):** BlackRock, Inc. was interested in a total of 479,549,185 H shares of the Company in accordance with the provisions of Part XV of the SFO. Of these shares, BlackRock Investment Management, LLC, BlackRock Financial Management, Inc., BlackRock Institutional Trust Company, National Association, BlackRock Fund Advisors, BlackRock Advisors, LLC, BlackRock Japan Co., Ltd., BlackRock Asset Management Canada Limited, BlackRock Investment Management (Australia) Limited, BlackRock Asset Management North Asia Limited, BlackRock (Netherlands) B. V., BlackRock Advisors (UK) Limited, BlackRock International Limited, BlackRock Asset Management Ireland Limited, BLACKROCK (Luxembourg) S. A., BlackRock Investment Management (UK) Limited, BlackRock Asset Management Deutschland AG, BlackRock Fund Managers Limited, BlackRock Life Limited, BlackRock (Singapore) Limited, BlackRock Asset Management Schweiz AG and Aperio Group, LLC were interested in 1,183,000 H shares, 7,752,000 H shares, 90,455,736 H shares, 173,279,000 H shares, 8,236,000 H shares, 6,464,387 H shares, 3,674,000 H shares, 4,022,000 H shares, 24,662,040 H shares, 16,079,321 H shares, 128,000 H shares, 220,000 H shares, 117,783,006 H shares, 6,161,000 H shares, 8,554,858 H shares, 291,000 H shares, 6,691,005 H shares, 415,000 H shares, 1,482,000 H shares, 112,000 H shares and 1,903,832 H shares, respectively. All of these entities are either controlled or indirectly controlled subsidiaries of BlackRock, Inc. Of these 479,549,185 H shares, 3,903,000 H shares were cash settled unlisted derivatives. BlackRock, Inc. held by way of attribution a short position as defined under Part XV of the SFO in 1,817,000 H shares (0.02%). These 1,817,000 H shares were cash settled unlisted derivatives. **(Note 3):** FMR LLC was interested in a total of 438,552,769 H shares of the Company in accordance with the provisions of Part XV of the SFO. Of these shares, Fidelity Management & Research Company LLC, Fidelity Management & Research (Hong Kong) Limited, Fidelity Institutional Asset Management Trust Company and FIAM LLC were interested in 175,446,421 H shares, 80,539,990 H shares, 13,895,625 H shares and 96,868,555 H shares, respectively. All of these entities are either controlled or indirectly controlled subsidiaries of FMR LLC. Save as disclosed above, the Directors and the chief executive of the Company are not aware of any other party who, as at 31 December 2025, had an interest or short position in the shares and underlying shares of the Company which was recorded in the register required to be kept by the Company pursuant to Section 336 of the SFO. --- # DIRECTORS, SENIOR MANAGEMENT AND EMPLOYEES ## DIRECTORS AND SENIOR MANAGEMENT ### Current Directors and Senior Management | Name | Position | Gender | Date of birth | Term | Total emoluments received from the Company during the Reporting Period in RMB ten thousands (before tax) | Whether received emolument from connected parties of the Company | |---|---|---|---|---|---|---| | Cai Xiliang | Chairman of the Board Executive Director | Male | August 1966 | Since 4 December 2024 | - | Yes | | Li Mingguang | Executive Director President | Male | July 1969 | Appointed as an Executive Director since 16 August 2019, President since November 2023 | - | Yes | | Liu Hui | Executive Director Vice President Chief Investment Officer Board Secretary | Female | February 1970 | Appointed as an Executive Director since 17 May 2024, a Vice President since July 2023, Chief Investment Officer since December 2023, Board Secretary since January 2025 | 162.34 | No | | Ruan Qi | Executive Director Vice President Chief Risk Officer | Male | July 1966 | Appointed as an Executive Director since 17 May 2024, a Vice President since April 2018, Chief Risk Officer since December 2022 | 160.21 | No | | Hu Jin | Non-executive Director | Female | November 1971 | Since 14 November 2024 | - | Yes | | Hu Rong | Non-executive Director | Male | March 1977 | Since 14 November 2024 | - | Yes | | Niu Kailong | Non-executive Director | Male | September 1974 | Since 6 August 2025 | - | Yes | | Lam Chi Kuen | Independent Director | Male | April 1953 | Since 29 June 2021 | 42.00 | No | | Zhai Haitao | Independent Director | Male | January 1969 | Since 14 October 2021 | 42.00 | Yes | | Chen Jie | Independent Director | Female | April 1970 | Since 13 July 2022 | 42.00 | No | | Lu Feng | Independent Director | Male | July 1957 | Since 19 November 2024 | 42.00 | No | | Li Wei | Employee Representative Director | Male | August 1972 | Since 11 March 2026 | - | No | | Xu Chongmiao | Chief Compliance Officer Person in Charge of Compliance | Male | October 1969 | Appointed as Chief Compliance Officer since April 2024, Person in Charge of Compliance since July 2018 | 142.79 | No | | Hou Jin | Assistant to the President Chief Actuary | Female | January 1980 | Appointed as an Assistant to the President since April 2025, Chief Actuary since November 2023 | 131.33 | No | | Lan Yonghong | Assistant to the President | Male | August 1976 | Since December 2025 | - | No | | Zhang Xinyu | Assistant to the President Chief Network Security Officer | Male | June 1978 | Appointed as an Assistant to the President since December 2025, Chief Network Security Officer since March 2026 | - | No | | Hu Zhijun | Person in Charge of Audit | Female | July 1971 | Since November 2023 | 126.54 | No | | Yuan Ying | Person in Charge of Finance | Female | February 1978 | Since July 2024 | 107.42 | No | | **Total** | **/** | **/** | **/** | **/** | **998.63** | **/** | --- Notes: 1. None of the current Directors and senior management of the Company held any shares of the Company during the Reporting Period. 2. According to the Articles of Association, Directors of the Company serve for a term of three years and may be re-elected. However, Independent Directors may not serve for more than six years. 3. The positions of the Directors and senior management in this report reflect their positions as at the date of this report. The emoluments are calculated based on their terms of office during the Reporting Period. 4. The pre-tax total remuneration of the current Directors and senior management of the Company includes basic salary, performance related bonus, benefits in kind, social insurance, the housing provident fund and the enterprise annuity paid by the Company, and other forms of remuneration received from the Company. The pre-tax total remuneration of Independent Directors includes basic salary and assessment-based remuneration. According to the requirements of the relevant measures for the administration of remuneration of the Company, the final amount of emoluments of the current Directors and senior management of the Company is currently subject to review and approval. The result of the review will be disclosed when the final amount is confirmed. 5. As elected by the 2023 Annual General Meeting of the Company and upon approval by the NFRA, Mr. Niu Kailong served as a Non-executive Director of the eighth session of the Board of the Directors of the Company from 6 August 2025. As elected by the fourth meeting of the fourth session of the employee representative meeting of the Company and upon approval by the NFRA, Mr. Li Wei served as an Employee Representative Director of the eighth session of the Board of the Directors of the Company from 11 March 2026. 6. As considered and approved by the ninth meeting of the eighth session of the Board of Directors of the Company and upon approval by the NFRA, Ms. Hou Jin served as an Assistant to the President of the Company from 10 April 2025. As considered and approved by the twentieth meeting of the eighth session of the Board of Directors of the Company and upon approval by the NFRA, Mr. Lan Yonghong and Mr. Zhang Xinyu served as Assistants to the President of the Company from 1 December 2025. Mr. Zhang Xinyu was appointed as the Chief Network Security Officer of the Company at the twenty-fifth meeting of the eighth session of the Board of Directors of the Company. Due to the adjustment of work arrangements, Mr. Ruan Qi ceased to be the Chief Network Security Officer of the Company from March 2026. ## Resigned Director and Senior Management | Name | Previous position | Gender | Date of birth | Term | Total emoluments received from the Company during the Reporting Period in RMB ten thousands (before tax) | Whether received emolument from connected parties of the Company | Reason for changes | | :--- | :--- | :--- | :--- | :--- | :--- | :--- | :--- | | Wang Junhui | Non-executive Director | Male | July 1971 | 16 August 2019 – 22 January 2026 | – | Yes | Resigned due to the adjustment of work arrangements | | Bai Kai | Vice President | Male | June 1974 | August 2023 – July 2025 | 93.91 | No | Resigned due to the adjustment of work arrangements | | **Total** | **/** | **/** | **/** | **/** | **93.91** | **/** | **/** | Notes: 1. None of the resigned Director and senior management of the Company held any shares of the Company during the Reporting Period. 2. This table sets out the information of Director and senior management who resigned during the period from the beginning of the Reporting Period to the date of this report. 3. The emoluments are calculated based on the terms of office of the resigned Director and senior management during the Reporting Period. 4. The pre-tax total remuneration of the resigned Director and senior management of the Company includes basic salary, performance related bonus, benefits in kind, social insurance, the housing provident fund and the enterprise annuity paid by the Company, and other forms of remuneration received from the Company. According to the requirements of the relevant measures for the administration of remuneration of the Company, the final amount of emoluments of the resigned Director and senior management of the Company is currently subject to review and approval. The result of the review will be disclosed when the final amount is confirmed. --- # Personal Profile of Current Directors, Senior Management and Company Secretary ## DIRECTORS ### **Mr. Cai Xiliang, born in 1966, Chinese** Mr. Cai Xiliang became the Chairman of the Board of Directors of the Company in December 2024. He has been the Chairman of the Board of Directors of China Life Insurance (Group) Company since November 2024. Mr. Cai served as the Vice Chairman and the President of China Life Insurance (Group) Company from July 2022 to August 2024. He served as the Chairman of each of China Life Asset Management Company Limited and China Life Property and Casualty Insurance Company Limited from November 2022 to March 2025. From 2016 to 2022, he served as the Deputy Secretary of the Party Committee, the Vice Chairman and the General Manager of China Export & Credit Insurance Corporation, and a member of the Party Committee and the Deputy General Manager of CITIC Group Corporation. Mr. Cai graduated from Shanghai University of Finance and Economics with a master’s degree in economics. ### **Mr. Li Mingguang, born in 1969, Chinese** Mr. Li became an Executive Director of the Company in August 2019. He has been the Secretary of the Party Committee of the Company since July 2023 and the President of the Company since November 2023. He has been a member of the Party Committee and a Vice President of China Life Insurance (Group) Company since April 2023 and November 2023, respectively. From July 2023 to July 2024, he served as the Chairman of China Life Investment Management Company Limited. Mr. Li joined the Company in 1996 and successively served as the Responsible Actuary, the General Manager of the Actuarial Department, the Chief Actuary, the Board Secretary, a Vice President and the temporary Person in Charge of the Company. He graduated from Shanghai Jiaotong University with a bachelor’s degree in 1991, Central University of Finance and Economics with a master’s degree in 1996 and Tsinghua University with an EMBA in 2010. Mr. Li is a Fellow of the China Association of Actuaries (FCAA) and a Fellow of the Institute and Faculty of Actuaries (FIA). He was the Chairman of the first session of the China Actuarial Working Committee and the Secretary-general of both the first and the second sessions of the China Association of Actuaries. He is currently the Vice Chairman of each of the China Association of Actuaries, the Insurance Association of China and the Insurance Society of China. Mr. Li receives a special government allowance from the State Council. ### **Ms. Liu Hui, born in 1970, Chinese** Ms. Liu became an Executive Director of the Company in May 2024. She has been a Vice President of the Company since July 2023, the Chief Investment Officer of the Company since December 2023, and the Board Secretary of the Company since January 2025. She has been a Director of China Guangfa Bank Co., Ltd. since January 2024, a Director of China Life Asset Management Company Limited since August 2023, and a Director of China Life Franklin Asset Management Company Limited since April 2023. From 2014 to 2022, Ms. Liu successively served as a Vice President of China Life Investment Holding Company Limited, and an Executive Director and a Vice President of China Life Investment Management Company Limited. Ms. Liu successively obtained a bachelor’s degree in economics from Renmin University of China and a master’s degree in business administration from Tsinghua University, and is a senior economist. --- ## Mr. Ruan Qi, born in 1966, Chinese **Mr. Ruan** became an Executive Director of the Company in May 2024. He has been a Vice President and the Chief Risk Officer of the Company since April 2018 and December 2022, respectively. Mr. Ruan has been a Director of China Life Property and Casualty Insurance Company Limited since April 2024. He has been the temporary Person in Charge and a Director of China Life Ecommerce Company Limited since January 2024 and May 2023, respectively. He has been the Chairman of Wonders Information Co., Ltd. since July 2023. He served as the Chief Network Security Officer of the Company from March 2024 to March 2026. He successively served as the General Manager (at the general manager level of the provincial branches) of the Information Technology Department and the Chief Information Technology Officer of the Company from 2016 to 2018. Mr. Ruan served as the General Manager of China Life Data Center and the General Manager (at the general manager level of the provincial branches) of the Information Technology Department of the Company from 2014 to 2016, and the Deputy General Manager and the General Manager of the Information Technology Department of the Company from 2004 to 2014. He successively served as the Deputy Division Chief of the Computer Division, and the Deputy Manager (responsible for daily operations) and the Manager of the Information Technology Department of Fujian Branch of the Company from 2000 to 2004. Mr. Ruan graduated from Beijing Institute of Posts and Telecommunications in August 1987, majoring in computer science and communications with a bachelor's degree in engineering, and from Xiamen University with a master's degree in business administration for senior management (EMBA) in December 2007, and is a senior engineer. ## Ms. Hu Jin, born in 1971, Chinese **Ms. Hu** became a Non-executive Director of the Company in November 2024. She has been the Person in Charge of Finance and the General Manager of the Finance Department of China Life Insurance (Group) Company since September 2025 and June 2024, respectively. She has been a Director of each of China Life Insurance (Overseas) Company Limited and China Life Asset Management Company Limited since January 2024 and September 2024, respectively. From 2013 to 2024, she served as the Deputy General Manager of the Finance Department, the Deputy General Manager of the Accounting Department, the General Manager of the Shared Service Center (Financial Sector), the General Manager of the Finance Department and the Person in Charge of Finance of the Company, and the Deputy General Manager (responsible for daily operations) of the Finance Department of China Life Insurance (Group) Company. Ms. Hu graduated from Renmin University of China in 1993, majoring in accounting with a bachelor's degree in economics, and obtained a master's degree in economics in 2006. She is admitted as a certified public accountant in the PRC, and is a principal senior accountant. She was listed in the "Financial Talent Pool" and "Accounting Talent Pool" of the Ministry of Finance of the PRC in 2020, and was a member of the Financial Accounting Expert Working Group of the Ministry of Finance of the PRC in 2019. --- ## Mr. Hu Rong, born in 1977, Chinese Mr. Hu became a Non-executive Director of the Company in November 2024. He has been the Person in Charge of Compliance of China Life Insurance (Group) Company since April 2024. He has been the Deputy General Manager of the Legal Compliance Department and the Deputy General Manager (responsible for daily operations) of the Risk Management Department of China Life Insurance (Group) Company since December 2023. Mr. Hu served as a Supervisor of China Life Insurance (Overseas) Company Limited from January 2025 to January 2026. He served as the Deputy General Manager (responsible for daily operations) of the Risk Management Department/Internal Control and Compliance Department of China Life Insurance (Group) Company from September 2023 to December 2023. He successively served as an Assistant to the General Manager of the Supervision Department and an Assistant to the General Manager and the Deputy General Manager (responsible for daily operations) of the Legal and Compliance Department of China Life Investment Holding Company Limited, as well as the Deputy General Manager (responsible for daily operations) and the General Manager of the Risk Management and Legal Compliance Department and the General Manager of the Infrastructure Investment Business Department of China Life Investment Management Company Limited from 2016 to 2023. Mr. Hu successively graduated from Xiamen University and the People’s Public Security University of China, and possesses a master’s degree in law. ## Mr. Niu Kailong, born in 1974, Chinese Mr. Niu became a Non-executive Director of the Company in August 2025. He has been the General Manager and the President of the Strategic Planning Department (General Office for Deepening Reforms)/Office of the Board of Directors/China Life Institute of Finance of China Life Insurance (Group) Company since December 2022. He has been a Director of China Life Asset Management Company Limited since October 2024, a Director of China Life Property and Casualty Insurance Company Limited since June 2023, and a Director of China Life Healthcare Investment Company Limited since December 2022. He served as a Supervisor of the Company from October 2021 to June 2024. Mr. Niu successively served as the Person in Charge of the Strategy and Investment Management Department of China Life Healthcare Investment Company Limited, the Deputy General Manager (responsible for daily operations) of the Strategic Planning Department of China Life Insurance (Group) Company, and the General Manager of the Strategic Planning Department/Office of the Board of Directors (in preparation) and the President of China Life Institute of Finance of China Life Insurance (Group) Company from June 2020 to December 2022. He successively served as the Deputy General Manager of the Strategic Planning Department of The People’s Insurance Company (Group) of China Limited, as well as a Supervisor, the Deputy General Manager (responsible for daily operations) of the Strategic Planning Department, and the Deputy General Manager (responsible for daily operations) of the Strategic Planning Department/Office of the Board of Directors of PICC Reinsurance Company Limited from April 2017 to June 2020. Mr. Niu graduated from Nankai University with a doctorate in finance. He is an associate researcher (social science) and senior economist. --- ## Mr. Lam Chi Kuen, born in 1953, Chinese Mr. Lam became an Independent Director of the Company in June 2021. He is currently an Independent Non-executive Director of each of China Cinda Asset Management Co., Ltd. and Luks Group (Vietnam Holdings) Company Limited. He served as an Independent Non-executive Director of China Pacific Insurance (Group) Co., Ltd. from 2013 to 2019. Mr. Lam, a practicing certified public accountant in Hong Kong for approximately 35 years, was a partner and senior consultant of Ernst & Young from 1992 to 2013 and has extensive experience in accounting, auditing and financial management. Mr. Lam received a Higher Diploma in Accounting from the Hong Kong Polytechnic College (the current Hong Kong Polytechnic University). He is a member of the Hong Kong Institute of Certified Public Accountants and a senior member of the Association of Chartered Certified Accountants. ## Mr. Zhai Haitao, born in 1969, Chinese Mr. Zhai became an Independent Director of the Company in October 2021. He is the President and Founding Partner of Primavera Capital Group. He served as an Independent Director of China Everbright Water Limited from August 2015 to April 2025. From 2000 to 2009, Mr. Zhai worked at and held various positions in Goldman Sachs Group, including the Managing Director, the Chief Representative of its Beijing Office, the Director of the Strategic Cooperation Office between Goldman Sachs Group and Industrial and Commercial Bank of China, and the Credit Rating Consultant of the Ministry of Finance of the PRC and China Development Bank. From 1995 to 1998, he was the Deputy Representative of the People’s Bank of China Representative Office for the Americas based in New York. From 1990 to 1995, Mr. Zhai worked at the International Department of the People’s Bank of China. Mr. Zhai holds a master’s degree in international affairs from Columbia University, a master’s degree in business administration from New York University and a bachelor’s degree in economics from Peking University. ## Ms. Chen Jie, born in 1970, Chinese Ms. Chen became an Independent Director of the Company in July 2022. She is the Director and a researcher of the Commercial Law Research Unit of the Institute of Law, a professor and doctoral tutor of Chinese Academy of Social Sciences. She is a member of the Chinese Legal System Committee of China Democratic League, as well as the Vice Chairman of China Business Law Society, and an Executive Director of each of the Institute of Commercial Law and the Institute of Securities Law of China Law Society. Ms. Chen is also a member of each of the Appeal Review Committee and Legal Professional Advisory Committee of Shenzhen Stock Exchange, a member of each of the Expert Advisory Committee of Beijing Financial Court and Expert Advisory Committee of Chengyu Financial Court, and an arbitrator of each of Beijing Arbitration Commission/Beijing International Arbitration Center, Shenzhen Court of International Arbitration, China International Economic and Trade Arbitration Commission, Shanghai International Economic and Trade Arbitration Commission and Shanghai Arbitration Commission. Ms. Chen has been an Independent Director of GigaDevice Semiconductor Inc. since December 2024 and an Independent Director of Deppon Logistics Co., Ltd. since October 2022. Ms. Chen obtained a bachelor’s degree in law from East China College of Political Science and Law, a master’s and doctoral degrees in law from Peking University, and a post-doctoral qualification from the Institute of Law of Chinese Academy of Social Sciences. --- ## Mr. Lu Feng, born in 1957, Chinese Mr. Lu became an Independent Director of the Company in November 2024. He is a professor of economics of the National School of Development and the chair professor of the Alumni College Development Fund of Peking University. He concurrently serves as a member of the Academic Committee of China Finance 40 Forum. Mr. Lu taught at the Economics Department of the University of Leeds of the United Kingdom from 1994 to 1995 and the Economics Department of Renmin University of China from 1985 to 1989, and previously visited and conducted research at Harvard University of the United States, The Australian National University and the Institute of Development Studies of the United Kingdom. He was also a consultation specialist of the Ministry of Human Resources and Social Security and the Ministry of Agriculture of the PRC, a member of the Advisory Committee of "ASEAN + 3 Macroeconomic Research Office (AMRO) ", an international organisation, and a member of the Consultation Committee of World Development Report 2016 of the World Bank. Mr. Lu obtained a bachelor’s degree in law and master’s degree in economics from Renmin University of China and a doctoral degree in economics from the University of Leeds of the United Kingdom. ## Mr. Li Wei, born in 1972, Chinese Mr. Li became an Employee Representative Director of the Company in March 2026. He has been the General Manager of the Labour Union Work Department/Mass Organisation Work Department of the Company since August 2024. He successively served as the Deputy General Manager of the Customer Service Department, the Deputy General Manager of Anhui Branch, the Deputy General Manager (responsible for daily operations) and General Manager of the E-commerce Department, the General Manager of the Customer Service Department, and the General Manager of the Bancassurance Department of the Company from 2006 to 2021. He successively served as the General Manager of the Strategic Marketing Department/Greater Bay Area Office of China Life Insurance (Overseas) Company Limited and the General Manager of PT China Life Insurance Indonesia from 2021 to 2024. Mr. Li graduated from the Japanese Studies Center at Beijing Foreign Studies University with a master’s degree in literature. During his career, he obtained a master’s degree in business administration for senior management from the School of Economics and Management at Tsinghua University. --- # SENIOR MANAGEMENT Mr. Li Mingguang, Ms. Liu Hui, Mr. Ruan Qi, please see the section “Directors” for their personal profiles. ## Mr. Xu Chongmiao, born in 1969, Chinese Mr. Xu became the Chief Compliance Officer of the Company in April 2024. He has been the Person in Charge of Compliance of the Company since July 2018, and the General Manager of the Legal and Compliance Department and the Legal Officer of the Company since September 2014. He has been a Director of China Insurance Security Fund Co., Ltd. since December 2024. From 2006 to 2014, he successively served as the Deputy General Manager of the Legal Affairs Department, the Deputy General Manager of the Legal and Compliance Department and the Legal Officer at the general manager level of the Company. From 2000 to 2006, he successively served as the Deputy Division Chief of the Regulations Division of the Development and Research Department and a senior regulations researcher of the Legal Affairs Department of the Company. Mr. Xu graduated from Fudan University in August 1991, majoring in economic law with a bachelor’s degree in law, and from Renmin University of China in July 1996 and July 2005, respectively, majoring in economic law with master’s and doctoral degrees in law. Mr. Xu is admitted as a lawyer and certified public accountant in the PRC, and receives a special government allowance from the State Council. ## Ms. Hou Jin, born in 1980, Chinese Ms. Hou became an Assistant to the President of the Company in April 2025. She has been the Chief Actuary of the Company since November 2023. She successively served as the General Manager of each of the Actuarial Department and the Product Department of the Company from 2023 to 2025. Ms. Hou successively served as a senior actuary (Grade III), an Assistant to the General Manager and the Deputy General Manager of the Actuarial Department and the temporary Chief Actuary of the Company from 2017 to 2023. Ms. Hou successively graduated from Southwestern University of Finance and Economics and Nankai University, with a bachelor’s degree and a master’s degree in economics, and is a full member of the China Association of Actuaries and a member of the Society of Actuaries. ## Mr. Lan Yonghong, born in 1976, Chinese Mr. Lan became an Assistant to the President of the Company in December 2025. He has been the Chairman of the Board of Directors and a Director of China Life Nianfeng Insurance Agency Co., Ltd. since March 2026 and July 2023, respectively. Mr. Lan has been concurrently serving as the General Manager of the Individual Insurance Operations Department of the Company since March 2025. He successively served as the Deputy General Manager of the Individual Insurance Sales Department and the Deputy General Manager and General Manager of the Individual Insurance Operations Department of the Company, a Director and the President of China Life Insurance Sales Company Limited (中國人壽保險銷售有限責任公司), and the President of China Life Nianfeng Insurance Agency Co., Ltd. from 2016 to 2026. Mr. Lan successively graduated from Nanjing University and the New York Institute of Technology of the United States, and possesses a master’s degree in business administration. --- ## **Mr. Zhang Xinyu, born in 1978, Chinese** Mr. Zhang became an Assistant to the President of the Company in December 2025. He has been the Chief Network Security Officer of the Company since March 2026. He has been the General Manager of the Underwriting and Claims Department/Reinsurance Department of the Company since November 2022 and has been concurrently serving as the General Manager of the Group Business Department/Strategic Customer Department of the Company since December 2024. He successively served as an Assistant to the General Manager, the Chief Engineer and the Deputy General Manager of the Research and Development Center, the Deputy General Manager of the Underwriting and Claims Department, and the Deputy General Manager of the Underwriting Department/Reinsurance Department of the Company from 2018 to 2022. Mr. Zhang graduated from Renmin University of China with a master’s degree in engineering. ## **Ms. Hu Zhijun, born in 1971, Chinese** Ms. Hu became the Person in Charge of Audit of the Company in November 2023. She has been the General Manager of the Audit Department of the Company since October 2022. She was a Supervisor of the Company from July 2022 to June 2023. Ms. Hu joined the Company in 2006 and successively served as an Assistant to the General Manager and the Deputy General Manager of Tianjin Branch, the Deputy General Manager and the Secretary of the Discipline Inspection Committee of Beijing Branch, and the General Manager of the Asset Management Department of the Company from 2009 to October 2022. Prior to joining the Company, she worked at China Packing Import & Export Tianjin Company and other companies. Ms. Hu graduated from Tianjin Institute of Finance and Economics in 1993, majoring in accounting with a bachelor’s degree in economics, and from Nankai University in 2006, majoring in corporate management with a master’s degree in management. Ms. Hu is admitted as a certified public accountant in the PRC. She is a principal senior accountant and the national leading accounting talent recognised by the Ministry of Finance of the PRC in the first session of its assessment and selection, and was listed in the “Financial Talent Pool” of the Ministry of Finance of the PRC. ## **Ms. Yuan Ying, born in 1978, Chinese** Ms. Yuan became the Person in Charge of Finance of the Company in July 2024. She has been the General Manager of the Finance Department of the Company since March 2025. She has been a Director of China Life Nianfeng Insurance Agency Co., Ltd. since September 2024. She successively served as an Assistant to the General Manager of the Accounting Department, and an Assistant to the General Manager, the Deputy General Manager and the Deputy General Manager (responsible for daily operations) of the Finance Department of the Company from 2018 to 2025. Ms. Yuan graduated from Peking University with a master’s degree in management. --- # COMPANY SECRETARY ## Mr. Heng Victor Ja Wei, born in 1977, British Mr. Heng is the managing partner of Morison Heng. He holds a Master of Science degree of the Imperial College of Science, Technology and Medicine, the University of London, and is a member of The Hong Kong Institute of Certified Public Accountants and a fellow of The Association of Chartered Certified Accountants. Mr. Heng has over 20 years of experience in accounting and auditing for private and public companies and financial consultancy. He serves as an Independent Non-executive Director of each of Lee & Man Chemical Company Limited, Matrix Holdings Limited, TradeGo Fintech Limited and Veson Holdings Limited, all of which are listed on the main board of the HKSE, as well as an Independent Non-executive Director of Bacui Technologies International Ltd., which is listed on the Singapore Exchange. ## Positions Held by Current Directors and Senior Management in Shareholders of the Company | Name | Name of shareholder | Position | Term | | :--- | :--- | :--- | :--- | | Cai Xiliang | China Life Insurance (Group) Company | Chairman | Since November 2024 | | Li Mingguang | China Life Insurance (Group) Company | Vice President | Since November 2023 | | Hu Jin | China Life Insurance (Group) Company | Person in Charge of Finance | Since September 2025 | | | | General Manager of the Finance Department | Since June 2024 | | Hu Rong | China Life Insurance (Group) Company | Person in Charge of Compliance | Since April 2024 | | | | Deputy General Manager of the Legal Compliance Department and the Deputy General Manager (responsible for daily operations) of the Risk Management Department | Since December 2023 | | Niu Kailong | China Life Insurance (Group) Company | General Manager and the President of the Strategic Planning Department (General Office for Deepening Reforms)/Office of the Board of Directors/China Life Institute of Finance | Since December 2022 | --- # Remuneration of Directors and Senior Management **Decision-making procedures for the remuneration of Directors and senior management:** The remuneration of Directors are approved by shareholders' general meetings, whereas the remuneration of senior management is approved by the Board of Directors. **Abstention from voting by Directors during the discussion of their remuneration at Board meetings:** The "Proposal in relation to the Remuneration of Directors and Supervisors of the Company" was considered and approved at the thirteenth meeting of the eighth session of the Board of Directors of the Company, and the Board of Directors agreed to submit the proposal to the shareholders' general meeting for approval. All Directors abstained from voting during the discussion of their remuneration. **Specific recommendations given by the Nomination and Remuneration Committee with respect to the remuneration of Directors and senior management:** The "Proposal in relation to the Remuneration of Directors and Supervisors of the Company" and the "Proposal in relation to the Remuneration of Senior Management of the Company" were considered and approved at the seventh meeting of the Nomination and Remuneration Committee of the eighth session of the Board of Directors of the Company. Having been fully reviewed by the Directors present at the meeting, the Nomination and Remuneration Committee unanimously approved the proposals and agreed to submit the same to the Board of Directors for review. **Basis for determination of the remuneration of Directors and senior management and appraisal basis and completion of remuneration actually received:** The remuneration of Directors and senior management are determined based on the Company's operating results and performance appraisal, and in accordance with the measures for the administration of remuneration of the Company. The Company conducts annual performance appraisal, and the appraisal results of the year 2025 have not yet been determined. **Actual payment of remuneration to Directors and senior management and total amount of remuneration actually received as at the end of the Reporting Period:** During the Reporting Period, the remuneration actually received by all Directors and senior management (including the resigned Director and senior management) from the Company totalled RMB10.9254 million. In accordance with the relevant requirements of the measures for the administration of remuneration of the Company, the standard for performance-based bonuses (as part of the remuneration) payable to Directors and senior management of the Company in 2025 has not yet been determined. **Deferral arrangements for remuneration actually received by all Directors and senior management as at the end of the Reporting Period:** Deferral arrangements for Directors and senior management are implemented in accordance with the relevant remuneration management measures of the Company. As a general principle, performance-based remuneration is deferred for no less than three years, with at least 40% subject to deferral. **Cessation of payment and recovery of remuneration actually received by all Directors and senior management as at the end of the Reporting Period:** In 2025, the Company recorded no instances of recovery or deduction of performance-based remuneration. # EMPLOYEES AND BRANCHES ## Employees | Item | Number | | :--- | :--- | | Number of employees of the Company | 95,385 | | Number of employees of the Company’s major subsidiaries | 2,120 | | **Employees in total** | **97,505** | | Retired employees of the Company and its major subsidiaries for which extra costs have to be incurred | 93 | As at the end of the Reporting Period, the composition of the employees of the Company and its major subsidiaries is as follows: | Class of professional composition | Number of employees | | :--- | :--- | | Management and administration | 19,188 | | Sales and sales management | 41,922 | | Finance and auditing | 4,514 | | Insurance verification, claim processing and customer services | 21,470 | | Other expertise and technicians | 6,777 | | Others | 3,634 | | **Total** | **97,505** | | Class of education level | Number of employees | | :--- | :--- | | Master and above | 7,785 | | Bachelor | 72,208 | | College diploma | 15,811 | | Secondary school | 686 | | Others | 1,015 | | **Total** | **97,505** | --- ## Employee Diversity The Company attached great importance to the enhancement of its development and competitiveness arising from the diversity of its employees. As at the end of the Reporting Period, there were four female members in the senior management of the Company, accounting for 44.4% of the senior management; the percentage of female employees of the Company and its major subsidiaries was 57%. ## Remuneration Policy for Employees The Company has established a remuneration and incentive system with reference to employee’s positions, the Company’s performance and market conditions. In accordance with the regulatory requirements and its needs for business operations and management, the Company developed the systems for the deferred payment of remuneration and the recovery and deduction of performance-based remuneration for Directors, senior management and personnel in key positions in 2023, so as to balance the relationship between short-term and long-term objectives, as well as returns and risks, ensure that remuneration incentives align with high-quality performance and prevent aggressive business practices and illegal activities, which consistently promoted the stable operations and sustainable development of the Company. ## Training Plans In 2025, the Company focused on enhancing the qualities and abilities of its cadres and employees in all aspects. According to the “four-in-one” education and training system, the Company collaborated closely with Party schools, colleges and universities to continuously enhance the political literacy and duty-performance capabilities of leading cadres at the headquarters and at provincial, municipal and county levels, and to improve their knowledge frameworks, including but not limited to training in political theory and Party spirit for leadership teams, newly appointed position training, on-the-job training, training for young and middle-aged cadres, rotation training for young cadres in talent pools, and the “three-year and four-stage” training program for new employees. Focusing on nurturing professional talents across various business lines and sectors, the Company further refined its education and training systems and mechanisms, concentrated on developing a team of full-time and part-time lecturers and a training management team, continuously optimised training methods and approaches through innovation, and strived to enhance training quality and efficiency, which ensured a supply of high-quality talents for the Company’s high-quality development. ## Branches As at the end of the Reporting Period, the Company had approximately 17,000 branches (including branches at the provincial or prefecture level, sub-branches, sales offices and sales & services offices). --- # REPORT OF CORPORATE GOVERNANCE ## OVERVIEW OF CORPORATE GOVERNANCE The Company implements good corporate governance policies and strongly believes that through fostering sound corporate governance, further enhancing its transparency and establishing an effective system of accountability, the Company can operate in a more systematic manner, make decisions in a more scientific way, and boost the confidence of investors. ### Corporate Governance Structure Chart - **Shareholders’ General Meeting** - **Board of Directors** - Audit Committee - Nomination and Remuneration Committee - Risk Management and Consumer Rights Protection Committee - Strategy and Assets and Liabilities Management Committee - Connected Transactions Control Committee - Board Secretary / Company Secretary / Board of Directors’ Office/ Investor Relations Department With the establishment of a corporate governance system with reasonably designed structure, well-developed mechanism, strict rules and regulations, as well as high efficiency in operation as its core objectives, the Company constantly promotes the development of its corporate governance, strictly performs its obligation of information disclosure, enhances its transparency and actively serves the interests of public investors so as to enhance its image and position in the capital market. The Company has set up a corporate governance structure with well-defined duties and responsibilities strictly in accordance with relevant laws, regulations and regulatory requirements, including the Company Law and the Securities Law. The corporate governance structure of the Company generally meets the regulatory requirements of its listed jurisdictions and the relevant provisions. The Company has carried out its corporate governance procedures strictly in accordance with relevant laws, regulations and regulatory requirements, including the Company Law and the Securities Law, as well as the requirements of its Articles of Association and procedural rules. In accordance with the regulatory requirements of its listed jurisdictions and the relevant provisions of its Articles of Association, the Company has continuously improved the decision-making mechanism of the Board. The Board is accountable to shareholders of the Company with respect to the assets and resources entrusted to it by the shareholders, and performs its duties on corporate governance. All members of the Board have taken initiatives to look into the Company’s affairs and have had a comprehensive understanding of the Company’s businesses. They have devoted sufficient time in performing their duties as Directors with due care and in a diligent and efficient manner. By setting up mechanisms including regular reporting of business development strategies and marketing tactics, the management of the Company can periodically report the business operations, development strategies and marketing tactics to the Board, which provides a basis for the Board’s decision-making. --- The Company has actively promoted the development of corporate governance, continuously improved its corporate governance structure and enhanced its scientific decision-making ability. In order to improve the decision-making efficiency of the specialised Board committees, the Board has established five specialised Board committees, i.e. the Audit Committee, the Nomination and Remuneration Committee, the Risk Management and Consumer Rights Protection Committee, the Strategy and Assets and Liabilities Management Committee, and the Connected Transactions Control Committee. These specialised Board committees conduct studies on specific matters, hold meetings both on a regular and an ad-hoc basis, communicate with the management, provide advice and recommendations for the Board’s consideration, and deal with matters entrusted or authorised by the Board, for the purposes of improving the Board’s efficiency and intensifying the Board’s functions. The Company has made information disclosure in a timely, open and transparent manner pursuant to the requirements of the listing rules of its listed jurisdictions. The Company has continuously improved its management of investor relations and enriched its communication with investors in both form and substance, thus ensuring that all its shareholders enjoy equal rights and have access to information about the Company in an open, fair, true and accurate manner. The Company has intensified its management of subsidiaries on an ongoing basis by optimising the management mechanism. The Company has formulated the “Measures for the Administration of Subsidiaries and Major Associates” to strengthen its management of performance of duties by the Directors and senior management designated to non-wholly owned subsidiaries and major associates, as well as its support to their duty performance, thereby increasing the Company’s management and control of subsidiaries in corporate governance. The Company has applied the principles of the Corporate Governance Code (the “CG Code”) as set out in Appendix C1 to the Listing Rules of the HKSE, and has complied with all code provisions of the CG Code during the Reporting Period. During the Reporting Period, the Company was awarded Grade A in the assessment by the SSE of information disclosure of listed companies for the year 2024-2025. It was also awarded, among others, the “Best Practice Case of the Board of Directors’ Office of Listed Companies for the Year 2025” by the China Association for Public Companies. ## SHAREHOLDERS’ GENERAL MEETING The shareholders’ general meeting, as an organ of the highest authority of the Company, exercises its duties and functions in accordance with relevant laws. Its duties and powers include: deciding on the operational policies and significant investment plans of the Company, electing and replacing Directors who are not employee representatives, deciding on the matters relating to the remuneration of the Directors, reviewing and approving the reports of the Board of Directors, reviewing and approving the annual financial budgets and final accounts of the Company, reviewing and approving the profit distribution policies, profit distribution plans and loss recovery plans of the Company, and any other matters required by the Articles of Association to be approved by way of resolution of the shareholders’ general meeting. The Company ensures that all shareholders are equally treated so as to ensure that the rights of all shareholders are protected, including the right of access to information in relation to, and the right to vote in respect of, major matters of the Company. The Company has the ability to operate and manage its business autonomously, and is separate and independent from its controlling shareholder in its business operations, personnel, assets and financial matters. The 2024 Annual General Meeting of the Company was held in Beijing on 26 June 2025, the First Extraordinary General Meeting 2025 of the Company was held in Beijing on 25 September 2025, and the Second Extraordinary General Meeting 2025 of the Company was held in Beijing on 30 December 2025. All the shareholders’ general meetings were convened and held in strict compliance with relevant laws, regulations and listing rules. Attendance records of the current Directors at the shareholders’ general meetings convened during the Reporting Period are as follows: | Name of Director | Type of Director | Number of shareholders’ general meetings required to attend for the year | Number of meetings attended in person | | :--- | :--- | :---: | :---: | | Cai Xiliang | Executive Director | 3 | 3 | | Li Mingguang | Executive Director | 3 | 3 | | Liu Hui | Executive Director | 3 | 3 | | Ruan Qi | Executive Director | 3 | 2 | | Hu Jin | Non-executive Director | 3 | 2 | | Hu Rong | Non-executive Director | 3 | 3 | | Niu Kailong¹ | Non-executive Director | 2 | 2 | | Lam Chi Kuen | Independent Director | 3 | 2 | | Zhai Haitao | Independent Director | 3 | 3 | | Chen Jie | Independent Director | 3 | 2 | | Lu Feng | Independent Director | 3 | 3 | **Notes:** 1. Mr. Niu Kailong became a Non-executive Director of the Company in August 2025. 2. Mr. Li Wei became an Employee Representative Director of the Company in March 2026. --- Attendance record of the resigned Director at the shareholders’ general meetings convened during the Reporting Period is as follows: | Name of Director | Type of Director | Number of shareholders’ general meetings required to attend for the year | Number of meetings attended in person | | :--- | :--- | :---: | :---: | | Wang Junhui | Non-executive Director | 3 | 3 | ## BOARD **The Board is the standing decision-making body of the Company** and its main duties and powers include: performing the function of corporate governance of the Company, convening shareholders’ general meetings, implementing resolutions passed at such meetings, determining the Company’s annual business plans and investment proposals, formulating the Company’s development strategies and supervising its implementation, formulating the Company’s annual financial budgets and final accounts, providing an objective evaluation on the Company’s operating results in its financial reports and other disclosure documents, regularly assessing and improving corporate governance, dealing with senior management personnel matters, arranging for Directors and senior management to attend various training courses, attaching importance to the enhancement of their professional quality, reviewing the compliance policies of the Company, assessing the internal control systems of the Company and reviewing the compliance by the Company with the CG Code. The day-to-day management and operation of the Company are delegated to the management. The responsibilities of Non-executive Directors and Independent Directors include, without limitation, regularly attending meetings of the Board and the specialised Board committees of which they are members, providing opinions at meetings of the Board and the specialised Board committees, resolving any potential conflict of interest, serving on the Audit Committee, the Nomination and Remuneration Committee and other specialised Board committees, and inspecting, supervising and reporting on the performance of the Company. The Board is accountable to the shareholders of the Company and reports to them. **In 2025, in compliance with the new Company Law**, the regulatory rules of its listed jurisdictions, applicable industry regulatory requirements and other laws, regulations and departmental rules, the Company completed adjustments to its corporate governance structure and amendments to the Articles of Association. With the approval of NFRA, the newly amended Articles of Association took effect on 22 December 2025. The Company no longer has the Board of Supervisors. The Audit Committee of the Board now exercises the functions and powers of the Board of Supervisors as specified in the Company Law and regulatory rules, and the Employee Representative Director has been added to the Board. Currently, the Board of the Company comprises twelve members, including four Executive Directors, three Non-executive Directors, four Independent Directors, and an Employee Representative Director. The number of Independent Directors complies with the minimum requirement of three Independent Directors and the requirement that at least one-third of the Board be represented by Independent Directors under the regulatory rules of the industry and its listed jurisdictions. All members of the Board have devoted sufficient time in dealing with the affairs of the Board and attended the relevant training courses organised by external regulatory authorities and the Company according to regulatory requirements. They have referred to regulatory documents on a regular basis so as to keep themselves informed of the regulatory development in a timely manner. The Company has applied director’s liability insurances for its Directors, which provide protection to Directors for liabilities that might arise in the course of their performance of duties according to law and facilitate Directors to fully perform their duties. So far as the Company is aware, no financial, business, family or other material relationship exists among members of the Board of Directors, the former Board of Supervisors or the senior management. **In 2025, Independent Directors of the Board of the Company** possessed extensive experience in various fields, such as macro economy, financial management, legal compliance, accounting and auditing. The Company also complies with the requirement of the Listing Rules of the HKSE that at least one of its Independent Directors has appropriate professional qualifications or accounting qualifications or related financial management expertise. As required under the Listing Rules of the SSE and the HKSE, the Company has obtained a written confirmation from each of its Independent Directors in respect of their independence. The Company is of the opinion that all of the Independent Directors are independent of the Company and strictly perform their duties as Independent Directors. Pursuant to the Articles of Association, Directors who are not employee representatives shall be elected at the shareholders’ general meeting for a term of three years and may be re-elected on expiry of the three-year term. However, the cumulative period of service for an Independent Director with the Company shall not exceed six years. --- The Company has developed a well-established procedure for nomination and election of Directors, under which the Board shall, when nominating Directors, consider their professional ability and conduct, and also take into account the requirement for diversity of the Board members. Complementarity among the Board members in aspects including but not limited to gender, age, culture, educational background, professional experience, skills and expertise will be considered in the selection of candidates for Directors. The Company will also take into account factors based on its own business model and specific needs from time to time. The ultimate decision will be based on merit and contribution that the selected candidates will bring to the Board. The Board and its Nomination and Remuneration Committee will from time to time discuss the measurable objective for achieving diversity of the Board. In relation to gender diversity, the Company sets its phased objective for 2025 as having three female Directors to serve on the Board. The above objective of gender diversity has been achieved as scheduled. The Company will also continue to take active actions in identifying female Directors and management members. The Company believes that the gender diversity in the Board would bring more inspiration to the Board and enhance the business development of the Company. Currently, the Board of the Company comprises twelve members with extensive experience in various fields, such as financial management, macro economy, financial accounting, law and management. The diversified composition of the Board is as follows: ## Board Composition | Category | Executive Director | Non-executive Director | Independent Director | Employee Representative Director | | :--- | :--- | :--- | :--- | :--- | | **Directors by type** | 4 persons | 3 persons | 4 persons | 1 person | | Category | Mainland China | Hong Kong, China | | :--- | :--- | :--- | | **Directors by location** | 10 persons | 2 persons | | Category | Male | Female | | :--- | :--- | :--- | | **Directors by gender** | 9 persons | 3 persons | ## Board Meetings and Procedures Meetings of the Board are held both on a regular and an ad-hoc basis. Regular meetings are convened at least four times a year for the examination and approval of proposals, such as annual report, interim report, quarterly reports, related financial reports, and major business operations of the year. Meetings are convened by the Chairman of the Board and a notice is given to all Directors 14 days before such meetings. Agendas and related documents are sent to the Directors at least 3 days prior to such meetings. In 2025, all notices, agendas and related documents in respect of such regular Board meetings were sent to Directors in compliance with the above requirements. By fully reviewing all the relevant proposals, the Board has confirmed that the information contained in its periodic reports and financial reports is true, accurate and complete and contains no false representations, misleading statements or material omissions, and no event or situation which would have material adverse impacts on the Company's ongoing operation has been found. The practice of obtaining Board consent through the circulation of written resolutions does not constitute a regular Board meeting. An ad-hoc Board meeting may be convened in urgent situations if requisitioned by any of the following: shareholders representing over one-tenth of voting shares, Directors constituting more than one-third of the total number of Directors, the Audit Committee of the Board, more than two Independent Directors or the Chairman of the Board. If the resolution to be considered at such ad-hoc Board meetings has been circulated to all the Directors and a majority of the Directors having voting rights approve such resolution by signing the resolution in writing, the ad-hoc Board meeting need not be physically convened and such resolution in writing shall become an effective resolution. If a Director is materially interested in a matter to be considered by the Board, the Director having such conflict of interest shall have no voting right on the matter to be considered and shall not be counted in the quorum for the Board meeting. All Directors shall have access to the advice and services of the Board Secretary and the Company Secretary. Detailed minutes of Board meetings regarding matters considered by the Board and decisions reached, including any concerns raised by Directors or dissenting views expressed, are kept by the Board Secretary. Minutes of Board meetings are available upon reasonable notice for inspection and comment upon by Directors. ## Current Board Membership Currently, the eighth session of the Board of the Company comprises the following members: Mr. Cai Xiliang, the Chairman of the Board and an Executive Director, Mr. Li Mingguang, Ms. Liu Hui and Mr. Ruan Qi, all being Executive Directors, Ms. Hu Jin, Mr. Hu Rong and Mr. Niu Kailong, all being Non-executive Directors, Mr. Lam Chi Kuen, Mr. Zhai Haitao, Ms. Chen Jie and Mr. Lu Feng, all being Independent Directors, and Mr. Li Wei, an Employee Representative Director. As elected by the 2023 Annual General Meeting of the Company and upon approval by the NFRA, Mr. Niu Kailong served as a Non-executive Director of the Company from 6 August 2025. As elected by the fourth meeting of the fourth session of the employee representative meeting of the Company and upon approval by the NFRA, Mr. Li Wei served as an Employee Representative Director of the Company from 11 March 2026. Due to the adjustment of work arrangements, Mr. Wang Junhui resigned from his position as a Non-executive Director of the Company on 22 January 2026. --- # Corporate Governance In 2025, all members of the Board further developed and refreshed their information and knowledge in aspects such as laws and regulations of securities markets, regulatory trends, macro economy and the development trend of the insurance industry by attending special training courses on certain topics as organised by the securities exchanges of the Company’s listed jurisdictions, listed companies associations and the Company itself. All Directors of the Company attended training programs on anti-money laundering compliance, ESG and climate risk, and the special training course for directors in 2025 as organised by the Listed Companies Association of Beijing (the “LCAB”). Mr. Cai Xiliang, the Chairman of the Board and an Executive Director, attended the training course of the SSE for the compliant performance of duties by directors, supervisors and senior management of listed companies in 2025, and the training course for first-time directors, supervisors and senior management of listed companies in 2025 (Session IV). Mr. Wang Junhui, a former Non-executive Director, attended the training course of the SSE for the compliant performance of duties by directors, supervisors and senior management of listed companies in 2025. Ms. Hu Jin, a Non-executive Director, attended the training course of the SSE for the compliant performance of duties by directors, supervisors and senior management of listed companies in 2025 and the training course for first-time directors, supervisors and senior management of listed companies in 2025 (Session IV). Mr. Hu Rong, a Non-executive Director, attended the training course of the SSE for the compliant performance of duties by directors, supervisors and senior management of listed companies in 2025, the training course for first-time directors, supervisors and senior management of listed companies in 2025 (Session IV), and the special training class on the development of the board of directors of state-owned enterprises and the enhancement of directors’ duty-performance capabilities organised by China Business Executives Academy, Dalian. Mr. Niu Kailong, a Non-executive Director, attended the training course of the SSE for first-time directors, supervisors and senior management of listed companies in 2025 (Session IV). Mr. Lam Chi Kuen, an Independent Director, attended the training course of the SSE for the compliant performance of duties by directors, supervisors and senior management of listed companies in 2025, the subsequent training course for independent directors of listed companies in 2025 (Session III), and the special training class on the development of the board of directors of state-owned enterprises and the enhancement of directors’ duty-performance capabilities organised by China Business Executives Academy, Dalian. Mr. Zhai Haitao, an Independent Director, attended the training course of the SSE for the compliant performance of duties by directors, supervisors and senior management of listed companies in 2025. Ms. Chen Jie and Mr. Lu Feng, both being Independent Directors, attended the training course of the SSE for the compliant performance of duties by directors, supervisors and senior management of listed companies in 2025 and the subsequent training course for independent directors of listed companies in 2025 (Session III). Furthermore, in accordance with Rule 3.09D of the Listing Rules of the HKSE, Mr. Niu Kailong and Mr. Li Wei, the new Directors, obtained the legal advice referred to in Rule 3.09D of the Listing Rules of the HKSE from Latham & Watkins LLP, the legal adviser of the Company as to the laws of Hong Kong, on 25 July 2024 and 10 March 2026, respectively (both prior to their appointments), and each Director has confirmed that he understood all requirements under the Listing Rules of the HKSE that are applicable to him as a director of a listed issuer and the possible consequences of making a false declaration or giving false information to the HKSE. Pursuant to the Measures for the Administration of Evaluation of the Performance of Duties by Directors of the Company, and after taking into account the actual situation of its corporate governance, the Company has conducted an evaluation of the performance of duties by Directors. Based on the self-assessment of Directors and the evaluation of Supervisors, all members of the Board of the Company were evaluated as competent in their performance of duties in 2025. --- # Meetings and Attendance During the Reporting Period, a total of 13 meetings (including 5 regular Board meetings and 8 ad-hoc Board meetings) were held by the Board of the Company, of which 10 meetings were convened by way of on-site meeting, 3 meetings by way of participation through communication tools. Attendance records of the current individual Directors are as follows: | Name of Director | Type of Director | Number of meetings required to attend | Number of meetings attended in person | Number of meetings participated through communication tools | Number of meetings attended by proxies | Number of meetings absent | | :--- | :--- | :---: | :---: | :---: | :---: | :---: | | Cai Xiliang | Executive Director | 13 | 11 | 3 | 2 | 0 | | Li Mingguang | Executive Director | 13 | 13 | 3 | 0 | 0 | | Liu Hui | Executive Director | 13 | 13 | 3 | 0 | 0 | | Ruan Qi | Executive Director | 13 | 10 | 3 | 3 | 0 | | Hu Jin | Non-executive Director | 13 | 11 | 3 | 2 | 0 | | Hu Rong | Non-executive Director | 13 | 10 | 3 | 3 | 0 | | Niu Kailong (1) | Non-executive Director | 5 | 4 | 0 | 1 | 0 | | Lam Chi Kuen | Independent Director | 13 | 13 | 3 | 0 | 0 | | Zhai Haitao | Independent Director | 13 | 13 | 3 | 0 | 0 | | Chen Jie | Independent Director | 13 | 10 | 3 | 3 | 0 | | Lu Feng | Independent Director | 13 | 13 | 3 | 0 | 0 | Notes: 1. (1) Mr. Niu Kailong became a Non-executive Director of the Company in August 2025. 2. (2) Mr. Li Wei became an Employee Representative Director of the Company in March 2026. Attendance record of the resigned Director of the Company at the Board meetings convened during the Reporting Period is as follows: | Name of Director | Type of Director | Number of meetings required to attend | Number of meetings attended in person | Number of meetings participated through communication tools | Number of meetings attended by proxies | Number of meetings absent | | :--- | :--- | :---: | :---: | :---: | :---: | :---: | | Wang Junhui | Non-executive Director | 13 | 12 | 3 | 1 | 0 | Note: Directors who were unable to attend any meeting of the Board authorised other Directors to attend and vote at the meeting on their behalf. # Performance of Duties by Independent Directors Currently, a total of four Independent Directors serve on the Board of the Company, accounting for over one-third of the total number of members of the Board and being in line with the requirements of relevant laws and regulations, as well as the Articles of Association. These four Independent Directors possess extensive experience in various fields, such as macro economy, financial management, legal compliance, accounting and auditing, and serve as the Chairmen/Chairpersons of the specialised Board committees. Other than receiving their remuneration as Independent Directors of the Company, they do not have any business or financial interest in the Company and its subsidiaries, nor hold any management positions in the Company. The Company has received annual confirmation letters for self-inspection from each of the Independent Directors to confirm their independence and, after the assessment of the Board, considered them to satisfy the criteria for independent directors and the requirements of independence under the regulatory rules of the Company's listed jurisdictions. --- # Attendance of Meetings by Independent Directors In 2025, all Independent Directors diligently fulfilled their responsibilities by attending meetings of the Board and the specialised Board committees, and special meetings of Independent Directors convened by the Company, providing independent opinions on matters considered by the Board in an objective and fair manner, including connected transactions, the remunerations of Directors, the nomination of senior management and their remunerations, and annual and interim profit distribution, thereby supporting the Board in making decisions in a scientific manner. The Independent Directors remained focused on the business operations and management of the Company and proactively engaged in the development of the specialised Board committees. They enhanced communications with the management and functional departments of the Company, attentively listened to relevant work reports, and concentrated on matters related to the Company’s strategic planning, major investment decisions, key personnel appointments and removals, enterprise-wide risk management, and amendments to important systems. They actively discussed the details of proposals from the Board and the specialised Board committees, and prompt the relevant departments of the Company to provide additional information as necessary in a timely manner. In 2025, the Independent Directors of the Company gave their consent to the matters resolved by the Board and the specialised Board committees of the Company. # Communications between Independent Directors and All Parties of the Company In 2025, the Independent Directors of the Company held a separate special meeting with the Chairman of the Board, during which the Independent Directors put forward their own views and opinions on various aspects such as the macro-environment, business development, and risk management, etc., based on their experience in their respective professional fields. They gave valuable advice on matters including the “15th Five-Year Plan” recommendations, business development, investment management, product development and employee incentives of the Company. # Investigation and Research by Independent Directors and the Trainings for Them The Company placed a high value on communication with its Independent Directors, and organised investigation and research activities for the Independent Directors. In 2025, the Independent Directors undertook investigation and research into the business development of the Shanghai Branch, the overall profile of the Company’s alternative investments, and its investments in science and technology innovation funds. During the year, to strengthen their continuing professional development, the Independent Directors received two special reports from the functional departments of the Company on the evolving trends in the personal insurance industry and the Company’s transformation and upgrade strategy, and the Company’s overseas investment activities. In the meanwhile, the Independent Directors further developed and refreshed their professional knowledge by actively attending special training courses as organised by the securities exchanges of the Company’s listed jurisdictions, listed companies associations and the Company itself. In 2025, the four Independent Directors of the Company attended the training program of the Company on anti-money laundering, the training course of the SSE for the compliant performance of duties and its subsequent training course for independent directors, and the special training course for directors organised by the LCAB. Mr. Lam Chi Kuen, an Independent Director, attended the special training class on the development of the board of directors of state-owned enterprises and the enhancement of directors’ duty-performance capabilities organised by China Business Executives Academy, Dalian. # Performance of Other Duties In 2025, the Independent Directors seriously listened to the issues that domestic and overseas investors were concerned about through attending results briefings of the Company, ensuring the communication and exchange of opinions with small- and medium-sized shareholders. There were no obstacles encountered by the four Independent Directors of the Company during their performance of duties. In 2025, the Company provided various information to Independent Directors, which facilitated them to comprehend new regulatory rules and information associated with the insurance industry. Independent Directors have access to adequate resources and may obtain external professional advice to ensure the performance of their duties. All Independent Directors obtained information relating to the operation and management of the Company through various channels, which therefore formed the basis of their scientific and prudent decisions. --- The Company believes that the composition of the Board of Directors of the Company (including the number and proportion of Independent Directors) and the above mechanism for the performance of duties by Independent Directors can ensure that independent views and input are available to the Board of Directors. # CHAIRMAN AND PRESIDENT As at the date of this report for disclosure, Mr. Cai Xiliang is the Chairman of the Board of the Company. He is primarily responsible for convening and presiding over Board meetings, ensuring the implementation of Board resolutions, attending annual general meetings and arranging attendance by Chairmen/Chairpersons of specialised Board committees to answer questions raised by shareholders, signing securities issued by the Company and other important documents, providing leadership for the Board to ensure that the Board works effectively and performs its responsibilities, encouraging all Directors to make a full and active contribution to the Board’s affairs, and promoting a culture of openness and debate. The Chairman of the Board is accountable to and reports to the Board. As at the date of this report for disclosure, Mr. Li Mingguang is the President of the Company. The President is responsible for the day-to-day operations of the Company, mainly including implementing the Company’s development strategies and policies, operation plans and investment schemes formulated by the Board, formulating the Company’s internal management structure and fundamental management systems, drawing up basic rules and regulations of the Company, submitting to the Board any requests for appointment or removal of senior management and exercising other rights granted to him under the Articles of Association and by the Board. The President is fully accountable to the Board for the operations of the Company. # AUDIT COMMITTEE Currently, the Audit Committee of the eighth session of the Board of the Company comprises Mr. Lam Chi Kuen, Mr. Zhai Haitao, Ms. Chen Jie and Mr. Lu Feng, all being Independent Directors, with Mr. Lam Chi Kuen acting as the Chairman. Members of the Audit Committee of the Board have professional expertise and working experience in such areas as finance, law, risk control and financial investment. The principal duties of the committee are to review and oversee the preparation of the Company’s financial information and disclosure, supervise and assess the Company’s internal and external audits and its internal control, and recommend the appointment or replacement of external auditors. The committee is also responsible for facilitating communications between internal and external auditors, overseeing the internal whistleblowing mechanism of the Company, and exercising the functions and powers of the Board of Supervisors as specified in the Company Law and relevant regulatory rules. ## Meetings and Attendance During the Reporting Period, six meetings were held by the Audit Committee of the Board of the Company. Attendance records of individual members are as follows: | Name of member | Position | Number of meetings attended in person/Number of meetings required to attend | Number of meetings attended by proxies/Number of meetings required to attend | | :--- | :--- | :---: | :---: | | Lam Chi Kuen | Independent Director, Chairman of the Audit Committee of the eighth session of the Board | 5/6 | 1/6 | | Zhai Haitao | Independent Director, member of the Audit Committee of the eighth session of the Board | 4/6 | 2/6 | | Chen Jie | Independent Director, member of the Audit Committee of the eighth session of the Board | 6/6 | 0/6 | **Notes:** 1. Mr. Lu Feng became a member of the Audit Committee of the Board in January 2026. 2. The number of meetings attended in person includes meetings attended on-site and by way of telephone or video conference. Directors who were unable to attend any meeting of specialised Board committees authorised other Directors to attend and vote at the meeting on their behalf. --- The meetings convened are as follows: | Meetings convened | Description | | :--- | :--- | | **25 March 2025**
Fourth meeting of the Audit Committee of the eighth session of the Board | Ten proposals, including the "Proposal in relation to the Financial Report of the Company for the Year 2024", the "Proposal in relation to the 2024 Annual Report of the Company (A share/H share)" and the "Report of Ernst & Young on the Audit for the Year 2024", were considered and approved. | | **28 April 2025**
Fifth meeting of the Audit Committee of the eighth session of the Board | Four proposals, including the "Proposal in relation to the First Quarter Report of the Company for 2025", were considered and approved, and two reports, namely the "Report of Ernst & Young on the Results of Agreed-upon Procedures for the First Quarter of 2025 and the Interim Review Plan for 2025" and the "Audit Report on the Asset and Liability Management of the Company for the Year 2024", were debriefed. | | **26 May 2025**
Sixth meeting of the Audit Committee of the eighth session of the Board | One proposal, namely the "Proposal in relation to the Appointment of Auditors of the Company for the Year 2025", was considered and approved. | | **26 August 2025**
Seventh meeting of the Audit Committee of the eighth session of the Board | Three proposals, including the "Proposal in relation to the Financial Report of the Company for the First Half of 2025", were considered and approved, and one report, namely the "Report of Ernst & Young on the Results of the Interim Review for 2025 and the Audit Plan for the Internal Control for the Year 2025", was debriefed. | | **29 October 2025**
Eighth meeting of the Audit Committee of the eighth session of the Board | One proposal, namely the "Proposal in relation to the Third Quarter Report of the Company for 2025", was considered and approved, and one report, namely the "Report of Ernst & Young on the Results of Agreed-upon Procedures for the Third Quarter of 2025 and the Annual Review Plan for 2025", was debriefed. | | **17 December 2025**
Ninth meeting of the Audit Committee of the eighth session of the Board | Two proposals, including the "Proposal in relation to the Amendments to the 'Procedural Rules for the Audit Committee Meetings of the Board of the Company'", were considered and approved. | ## Performance of Duties by the Audit Committee In 2025, the Audit Committee of the Board of the Company performed its relevant duties and functions in strict compliance with the "Procedural Rules for the Audit Committee Meetings of the Board". During meetings of the Audit Committee of the Board, all members reviewed the proposals in relation to, among others, the audit of the Company, its financial reports, selection and appointment of external auditors, internal control and compliance, and actively participated in discussions at the meetings. **Reviewing and overseeing the Company's financial information and disclosure.** The Audit Committee of the Board, according to its duties, reviewed and approved the Company's financial reports for the year 2024, the first quarter of 2025, the first half of 2025 and the third quarter of 2025. The Audit Committee of the Board was of the view that the financial reports of the Company reflected the overall situation of the Company in a true, accurate and complete manner. By reviewing and monitoring the completeness of financial statements, annual report and accounts, interim report and quarterly reports of the Company, examining significant matters such as financial statements and reports, and focusing on changes in major accounting items, compliance with accounting standards, information on the difference between the financial statements prepared under ASBE and IFRSs, and the major accounting policies under new accounting standards, the Audit Committee of the Board guaranteed the accuracy, completeness and consistency of the financial information publicly disclosed by the Company. **Supervising and assessing the internal audits of the Company.** In 2025, the internal audit department of the Company regularly updated the Audit Committee of the Board on the progress of the Company's internal audits, the development of its audit system and significant audit matters. The Audit Committee of the Board reviewed the proposals of the Company in relation to, among others, the internal audit work report for 2024 and the internal audit work report for the first half of 2025, communicated any matters of concern in a timely and effective manner, and supervised the compliance and effectiveness of the internal audit function. The Audit Committee of the Board was of the view that the internal audit function of the Company was effective during the Reporting Period. --- Selecting and appointing external auditors and overseeing their performance of duties. In 2025, the Audit Committee of the Board carried out the selection and appointment of the auditors of the Company for the 2025 annual audit. The Company performed its review duty in a compliant manner, examined the relevant qualifications, professional capabilities and independence, etc. of external auditors, reviewed the "Proposal in relation to the Appointment of Auditors of the Company for the Year 2025", and agreed to submit such proposal to the Board of the Company for consideration. The Audit Committee of the Board highly valued communication with external auditors and supervised the performance of duties by the external auditors in a diligent and responsible way. Besides regular meetings, the Audit Committee of the Board convened communication meetings in advance with external auditors so as to discuss the annual audit plan of the Company, determine the service scope of the annual audit, listen to the report given by the auditors with respect to the results of the audit on and review of periodic financial reports of the Company, and gave opinions and advice on the agreed-upon procedures proposed annually and quarterly by the external auditors of the Company and the pre-approval of the service scope. Before external auditors commenced their on-site audit work and prior to the review of the annual report, the Audit Committee of the Board communicated with external auditors on relevant matters and listened to the report on the annual audit plan. Prior to the issuance of the audit opinion, the Audit Committee of the Board communicated with external auditors to ascertain whether any issues had arisen during the audit and to follow up on and keep abreast of the audit progress. Based on the duty performance of the auditors for the annual audit, the Audit Committee of the Board reported to the Board of the Company on its oversight of the auditors' performance for the year 2025. Supervising and assessing the effectiveness of internal control of the Company. The Audit Committee of the Board provided guidance to the Company on the management of internal control, devised the working plan for internal control assessment, reviewed the work report on assessment of internal control, and inspected the rectification of problems identified in the internal control pursuant to the "Standard Regulations on Corporate Internal Control" and other domestic and overseas regulatory requirements. The Audit Committee of the Board earnestly performed its duties and responsibilities and monitored the Company to carry out its work in compliance with laws and regulations pursuant to the relevant requirements of the NFRA and the securities exchanges of the jurisdictions where securities of the Company are listed. As required by its duties and responsibilities, the Audit Committee of the Board reviewed the annual work report on and working plan for internal control assessment, and the annual compliance report of the Company to ensure that its work was conducted strictly according to the relevant regulatory requirements in a reasonable and efficient manner. During the Reporting Period, the Audit Committee of the Board did not identify any risks at the Company and raised no objections to the matters within its oversight during the Reporting Period. ## NOMINATION AND REMUNERATION COMMITTEE Currently, the Nomination and Remuneration Committee of the eighth session of the Board comprises Ms. Chen Jie and Mr. Lam Chi Kuen, both being Independent Directors, and Ms. Hu Jin, a Non-executive Director, with Ms. Chen Jie acting as the Chairperson. The Nomination and Remuneration Committee of the Board is mainly responsible for reviewing the structure of the Board, its number of members and composition and drawing up plans for the appointment, succession and appraisal criteria of Directors and senior management. The committee is also responsible for formulating training and remuneration policies for the senior management of the Company. The Nomination and Remuneration Committee of the Board, as an advisor to the Board on the nomination of Directors, shall first discuss and agree on the list of candidates to be nominated as new Directors, following which such candidates are recommended to the Board. The Board shall then determine whether such candidates should be proposed for election at the shareholders' general meeting. The major criteria considered by the Nomination and Remuneration Committee of the Board and the Board are educational background, management and research experience in the insurance industry, and the candidates' commitment to the Company. As to the nomination of Independent Directors, the Nomination and Remuneration Committee and Remuneration Committee of the Board will give special consideration to the independence of the relevant candidates. The Nomination and Remuneration Committee of the Board determines, with delegated responsibility by the Board, the specific remuneration packages of all Executive Directors and senior management. The fixed salary of the Executive Directors and other members of senior management are determined in accordance with market levels and their respective positions, and the amount of their performance-related bonuses is determined according to the results of performance appraisals. Directors' fees are determined with reference to market levels and the actual circumstances of the Company. --- # Meetings and Attendance During the Reporting Period, six meetings were held by the Nomination and Remuneration Committee of the Board of the Company. Attendance records of individual members are as follows: | Name of member | Position | Number of meetings attended in person/Number of meetings required to attend | Number of meetings attended by proxies/Number of meetings required to attend | | :--- | :--- | :--- | :--- | | Chen Jie | Independent Director, Chairperson of the Nomination and Remuneration Committee of the eighth session of the Board | 6/6 | 0/6 | | Lam Chi Kuen | Independent Director, member of the Nomination and Remuneration Committee of the eighth session of the Board | 6/6 | 0/6 | Attendance record of the resigned Director at meetings is as follows: | Name of member | Number of meetings attended in person/Number of meetings required to attend | Number of meetings attended by proxies/Number of meetings required to attend | | :--- | :--- | :--- | | Wang Junhui | 5/6 | 1/6 | **Notes:** 1. Mr. Wang Junhui resigned as a Non-executive Director of the Company and a member of the Nomination and Remuneration Committee of the Board in January 2026. 2. Ms. Hu Jin became a member of the Nomination and Remuneration Committee of the Board in January 2026. 3. The number of meetings attended in person includes meetings attended on-site and by way of telephone or video conference. Directors who were unable to attend any meeting of specialised Board committees authorised other Directors to attend and vote at the meeting on their behalf. --- The meetings convened are as follows: | Meetings convened | Description | | :--- | :--- | | **17 February 2025**
Sixth meeting of the Nomination and Remuneration Committee of the eighth session of the Board | One proposal, namely the "Proposal in relation to the Nomination of Mr. Wu Jian as a Vice President of the Company", was considered and approved. | | **25 March 2025**
Seventh meeting of the Nomination and Remuneration Committee of the eighth session of the Board | Seven proposals, including the "Proposal in relation to the Remuneration of Directors and Supervisors of the Company", were considered and approved. | | **28 April 2025**
Eighth meeting of the Nomination and Remuneration Committee of the eighth session of the Board | One proposal, namely the "Proposal in relation to the 'Incentive and Restraint Mechanism' section of the 'Corporate Governance Report of the Company for the Year 2024'", was considered and approved. | | **24 September 2025**
Ninth meeting of the Nomination and Remuneration Committee of the eighth session of the Board | Two proposals, namely the "Proposal in relation to the Nomination of Mr. Lan Yonghong as an Assistant to the President of the Company" and the "Proposal in relation to the Nomination of Mr. Zhang Xinyu as an Assistant to the President of the Company", were considered and approved. | | **29 October 2025**
Tenth meeting of the Nomination and Remuneration Committee of the eighth session of the Board | One proposal, namely the "Proposal in relation to the Performance Target Contracts of Senior Management of the Company for the Year 2025", was considered and approved. | | **17 December 2025**
Eleventh meeting of the Nomination and Remuneration Committee of the eighth session of the Board | One proposal, namely the "Proposal in relation to the Results of Performance Appraisal of Senior Management of the Company for the Year 2024", was considered and approved. | ## Performance of Duties by the Nomination and Remuneration Committee In 2025, the Nomination and Remuneration Committee of the Board of the Company performed its relevant duties and functions in strict compliance with the "Procedural Rules for the Nomination and Remuneration Committee Meetings of the Board". All members of the Nomination and Remuneration Committee performed their obligations in a responsible manner and reviewed the proposals on the nomination of senior management of the Company, their business objectives and performance appraisal results, the remuneration plans of Directors, former Supervisors and senior management, and the reports on the duty performance of the Audit Committee of the Board and the Nomination and Remuneration Committee of the Board. During meetings of the Nomination and Remuneration Committee of the Board, all members actively participated in discussions and gave guiding opinions on the proposals considered and discussed at the meetings. Nomination and proposed appointment of senior management officers of the Company and the Board diversity policy. The Company firmly believes that the Board diversity may enhance the decision-making capability of the Board, and considers the Board diversity as a key factor for maintaining a sound corporate governance standard and achieving the sustainable development of the Company. In accordance with the "Procedural Rules for the Nomination and Remuneration Committee Meetings of the Board" and the Board diversity policy, the Nomination and Remuneration Committee seriously reviewed the structure of the Board, its number of members and composition (including taking into account diversity factors, such as gender, age, cultural and educational background, skills, expertise and experience). In 2025, in accordance with the "Procedural Rules for the Nomination and Remuneration Committee Meetings of the Board", the Nomination and Remuneration Committee of the Board reviewed the proposals on the nomination of vice presidents and the assistants to the president of the Company, and conducted a careful assessment on the qualifications, skills, expertise and experience of candidates to ensure that the candidates met the requirements set by the Company, and agreed to submit such proposals to the Board for consideration. --- **Proposing remuneration policy of Directors, former Supervisors and senior management of the Company.** Taking into account various factors such as business development management, strategic investment decisions, and corporate governance, the Nomination and Remuneration Committee of the Board reviewed the proposals on the remuneration of Directors, former Supervisors and senior management of the Company for 2024 and the recovery and deduction of performance-based remuneration for the year 2024, approved the terms of service contracts between the Company and Directors and pushed forward the signing of service contracts between the Company and newly appointed Directors, clearly defining the rights, obligations and entitlements of Directors; and conducted a careful appraisal of their performance of duties. **Carrying out the evaluation of the performance of duties by Directors, former Supervisors and senior management of the Company and their performance appraisal.** The Nomination and Remuneration Committee of the Board reviewed proposals on the results of evaluating the performance of duties by Directors of the Company for the year 2024, the results of performance appraisal of senior management of the Company for the year 2024 and the performance target contracts of senior management for the year 2025, and made recommendations to the Board in respect of matters such as the determination of performance targets, performance appraisal procedures and results. # RISK MANAGEMENT AND CONSUMER RIGHTS PROTECTION COMMITTEE Currently, the Risk Management and Consumer Rights Protection Committee of the eighth session of the Board comprises Mr. Lu Feng, an Independent Director, Mr. Ruan Qi, an Executive Director, Mr. Hu Rong, a Non-executive Director, and Ms. Chen Jie, an Independent Director, with Mr. Lu Feng acting as the Chairman. The Risk Management and Consumer Rights Protection Committee of the Board is mainly responsible for formulating the Company’s system of risk control benchmarks, reviewing the Company’s overall objective of risk management, risk appetite and risk tolerance, formulating risk management policies, assessing the effectiveness of the operation of the Company’s risk management system, establishing well-developed risk management and internal control systems, setting compliance management objectives, performing duties relevant to compliance management, reviewing assessment reports on the Company’s risk management and internal control and studying major investigation findings on risk management and internal control matters and the business management’s response to these findings as delegated by the Board or on its own initiative, studying major issues and key policies on consumer rights protection, directing and supervising the establishment and optimisation of the system for the management of consumer rights protection, assessing the risks of major matters concerning the business operations and management of the Company, consistently focusing on various risks and their management, dealing with major disagreements, major risk emergency events or crisis events in risk management, and supervising the senior management and the relevant departments to resolve any issues identified during the rectification process in a timely manner. ## Meetings and Attendance During the Reporting Period, six meetings were held by the Risk Management and Consumer Rights Protection Committee of the Board of the Company. Attendance records of individual members are as follows: | Name of member | Position | Number of meetings attended in person/Number of meetings required to attend | Number of meetings attended by proxies/Number of meetings required to attend | | :--- | :--- | :--- | :--- | | Lu Feng | Independent Director, Chairman of the Risk Management and Consumer Rights Protection Committee of the eighth session of the Board | 6/6 | 0/6 | | Ruan Qi | Executive Director, member of the Risk Management and Consumer Rights Protection Committee of the eighth session of the Board | 3/6 | 3/6 | | Hu Rong | Non-executive Director, member of the Risk Management and Consumer Rights Protection Committee of the eighth session of the Board | 3/6 | 3/6 | | Chen Jie | Independent Director, member of the Risk Management and Consumer Rights Protection Committee of the eighth session of the Board | 5/6 | 1/6 | --- Notes: 1. Ms. Hu Jin ceased to be a member of the Risk Management and Consumer Rights Protection Committee of the Board from January 2026. During her tenure as a member of the Risk Management and Consumer Rights Protection Committee of the Board in 2025, the Risk Management and Consumer Rights Protection Committee of the Board convened six meetings, four of which Ms. Hu Jin attended in person, and two of which Ms. Hu attended by proxies. 2. The number of meetings attended in person includes meetings attended on-site and by way of telephone or video conference. Directors who were unable to attend any meeting of specialised Board committees authorised other Directors to attend and vote at the meeting on their behalf. The meetings convened are as follows: | Meetings convened | Description | |-------------------|-------------| | **22 January 2025**
Fourth meeting of the Risk Management and Consumer Rights Protection Committee of the eighth session of the Board | Two proposals, including the “Proposal in relation to the Risk Compliance Analysis on the Asset Strategic Allocation Plan of the Company for the Years from 2025 to 2027”, were considered and approved. | | **25 March 2025**
Fifth meeting of the Risk Management and Consumer Rights Protection Committee of the eighth session of the Board | Twelve proposals, including the “Proposal in relation to the Assessment Report on the Effectiveness of the Fraud Risk Management System of the Company for the Year 2024”, were considered and approved, and two reports, including the “Report on the Self-assessment of Money Laundering Risk of the Company for the Year 2024”, were debriefed. | | **28 April 2025**
Sixth meeting of the Risk Management and Consumer Rights Protection Committee of the eighth session of the Board | One proposal, namely the “Proposal in relation to the Financial Budget of the Company for the Year 2025”, was considered and approved. | | **26 August 2025**
Seventh meeting of the Risk Management and Consumer Rights Protection Committee of the eighth session of the Board | Two proposals, including the “Proposal in relation to the ‘Report on the Enterprise-wide Risk Management of the Company for the Second Quarter of 2025’”, were considered and approved, and one report, namely the “Report on the Notification of the Regulator’s Assessment of the Consumer Rights Protection of the Company and the Rectification Measures Taken for the Year 2024”, was debriefed. | | **24 September 2025**
Eighth meeting of the Risk Management and Consumer Rights Protection Committee of the eighth session of the Board | One proposals, namely the “Proposal in relation to the Authorisation for the Adjustment to the Percentage of Equity Investments by the Company in the Open Market”, was considered and approved. | | **17 December 2025**
Ninth meeting of the Risk Management and Consumer Rights Protection Committee of the eighth session of the Board | Seven proposals, including the “Proposal in relation to the Authorisation of Investment in Single Asset Management Plan of the Company for the Year 2026”, were considered and approved, and one report, namely the “Audit Report on the Solvency Risk Management System of the Company for 2025”, was debriefed. | --- # Performance of Duties by the Risk Management and Consumer Rights Protection Committee **In 2025, the Risk Management and Consumer Rights Protection Committee of the Board of the Company performed its duties and functions in strict compliance with the “Procedural Rules for the Risk Management and Consumer Rights Protection Committee Meetings of the Board”.** All members performed their obligations in a responsible manner and reviewed the proposals in relation to the internal control system of the Company, its risk management and consumer rights protection. During meetings of the Risk Management and Consumer Rights Protection Committee of the Board, all members actively participated in discussions and gave guiding opinions on the proposals considered and discussed at the meetings. **Reviewing the risk analysis on major matters concerning the business operations and management of the Company.** In line with the regulatory requirements of the former China Banking and Insurance Regulatory Commission on the China Risk Oriented Solvency System (C-ROSS), the Risk Management and Consumer Rights Protection Committee of the Board assessed the risks of major matters concerning the business operations and management of the Company, consistently focused on the various risks faced by the Company and their management, and reviewed and approved the proposals in relation to the business plan of the Company for the years from 2025 to 2027, the risk compliance analysis on the asset strategic allocation plan of the Company for the years from 2025 to 2027 and the authorisation for investment for the year 2026, and provided guiding opinions on risk control for major matters concerning the business operations and management of the Company. **Reviewing the assessment reports on business risk and internal control of the Company.** The Risk Management and Consumer Rights Protection Committee of the Board closely monitored and controlled and effectively prevented internal and external risks of the Company, and assisted the Board in reviewing the assessment reports on business risk and internal control of the Company, according to the national and international regulatory requirements. In 2025, the Risk Management and Consumer Rights Protection Committee of the Board reviewed in advance the annual and interim reports on the enterprise-wide risk management of the Company, the annual report on anti-money laundering work, the annual report on reputational risk management, the annual report on operational risk management, the annual statement on risk appetite, the annual assessment report on effectiveness of the fraud risk management system, the annual assessment report on risk prevention and control in respect of criminal cases, the annual self-assessment report on money laundering risk, the annual report on the assessment and management of liquidity risk, the annual audit report on anti-money laundering and the annual audit report on the solvency risk management system, which offered professional support to the Board’s decision-making in a scientific manner. **Reviewing the reports in relation to consumer rights protection on a regular basis.** The Risk Management and Consumer Rights Protection Committee of the Board reviewed the report on the consumer rights protection of the Company for the year 2024, the work proposal for consumer rights protection for 2025, the internal appraisal results of consumer rights protection for the year 2024 and the detailed rules for assessment and appraisal indicators of consumer rights protection for the year 2025, the report on the notification of the regulator’s assessment of consumer rights protection and the rectification measures taken for the year 2024, and the special audit report on consumer rights protection for 2025. **Optimising the system of the Company in relation to internal control and risk and compliance management.** The Risk Management and Consumer Rights Protection Committee of the Board assisted the Board in optimising the system of the Company in relation to internal control and risk management, reviewed the proposals in relation to the formulation of the “Measures for the Administration of Concentration Risk of the Company”, the amendments to the “Measures for the Administration of Compliance Management of the Company” and the amendments to the “Measures for the Administration of Anti-insurance Fraud of the Company”. Further, the Company regularly notified the Risk Management and Consumer Rights Protection Committee of the Board of its integrated risk rating results given by the NFRA. # STRATEGY AND ASSETS AND LIABILITIES MANAGEMENT COMMITTEE **Currently, the Strategy and Assets and Liabilities Management Committee of the eighth session of the Board comprises Mr. Zhai Haitao, an Independent Director, Mr. Li Mingguang and Ms. Liu Hui, both being Executive Directors, Mr. Niu Kailong, a Non-executive Director, and Mr. Lu Feng, an Independent Director, with Mr. Zhai Haitao acting as the Chairman.** The Strategy and Assets and Liabilities Management Committee of the Board of the Company is mainly responsible for the drawing-up of long-term development strategies and medium- and long-term development outline of the Company, conducting studies and review on important matters concerning assets and liabilities management and the relevant policies and systems, the system for the application and management of insurance funds, major strategic investment decisions, major asset strategic allocation plan, and green finance and sustainable development strategies, and making recommendations to the Board in respect thereof. --- # Meetings and Attendance During the Reporting Period, eight meetings were held by the Strategy and Assets and Liabilities Management Committee of the Board of the Company. Attendance records of individual members are as follows: | Name of member | Position | Number of meetings attended in person/Number of meetings required to attend | Number of meetings attended by proxies/Number of meetings required to attend | | :--- | :--- | :--- | :--- | | Zhai Haitao | Independent Director, Chairman of the Strategy and Assets and Liabilities Management Committee of the eighth session of the Board | 7/8 | 1/8 | | Li Mingguang | Executive Director, member of the Strategy and Assets and Liabilities Management Committee of the eighth session of the Board | 6/8 | 2/8 | | Liu Hui | Executive Director, member of the Strategy and Assets and Liabilities Management Committee of the eighth session of the Board | 7/8 | 1/8 | | Niu Kailong | Non-executive Director, member of the Strategy and Assets and Liabilities Management Committee of the eighth session of the Board | 4/4 | 0/4 | | Lu Feng | Independent Director, member of the Strategy and Assets and Liabilities Management Committee of the eighth session of the Board | 8/8 | 0/8 | **Attendance record of the resigned Director at meetings is as follows:** | Name of member | Number of meetings attended in person/Number of meetings required to attend | Number of meetings attended by proxies/Number of meetings required to attend | | :--- | :--- | :--- | | Wang Junhui | 3/4 | 1/4 | **Notes:** 1. Mr. Wang Junhui ceased to be a member of the Strategy and Assets and Liabilities Management Committee of the Board in August 2025. 2. Mr. Niu Kailong became a member of the Strategy and Assets and Liabilities Management Committee of the Board in August 2025. 3. The number of meetings attended in person includes meetings attended on-site and by way of telephone or video conference. Directors who were unable to attend any meeting of specialised Board committees authorised other Directors to attend and vote at the meeting on their behalf. --- The meetings convened are as follows: | Meetings convened | Description | | :--- | :--- | | **22 January 2025**
Fourth meeting of the Strategy and Assets and Liabilities Management Committee of the eighth session of the Board | Two proposals, including the “Proposal in relation to the Asset Strategic Allocation Plan of the Company for the Years from 2025 to 2027”, were considered and approved. | | **25 March 2025**
Fifth meeting of the Strategy and Assets and Liabilities Management Committee of the eighth session of the Board | Six proposals, including the “Proposal in relation to the ESG and Social Responsibility Report of the Company for 2024”, were considered and approved. | | **28 April 2025**
Sixth meeting of the Strategy and Assets and Liabilities Management Committee of the eighth session of the Board | One proposal, namely the “Proposal in relation to the Financial Budget of the Company for the Year 2025”, was considered and approved, and one report, namely the “Report on the Situation Relevant to the Assets and Liabilities Management of the Company for the Year 2024”, was debriefed. | | **26 June 2025**
Seventh meeting of the Strategy and Assets and Liabilities Management Committee of the eighth session of the Board | Two proposals, including the “Proposal in relation to the Company’s Budget for Investment in Fixed Assets for the Year 2025”, were considered and approved. | | **26 August 2025**
Eighth meeting of the Strategy and Assets and Liabilities Management Committee of the eighth session of the Board | Two proposals, including the “Proposal in relation to the Amendments to the ‘Measures for the Administration of the Approval Authority of Fixed Assets of the Company’”, were considered and approved. | | **24 September 2025**
Ninth meeting of the Strategy and Assets and Liabilities Management Committee of the eighth session of the Board | One proposal, namely the “Proposal in relation to the Authorisation for the Adjustment to the Percentage of Equity Investments by the Company in the Open Market”, was considered and approved. | | **29 October 2025**
Tenth meeting of the Strategy and Assets and Liabilities Management Committee of the eighth session of the Board | One proposal, namely the “Proposal in relation to the Results of Performance Appraisal of the Company for the Year 2024”, was considered and approved. | | **17 December 2025**
Eleventh meeting of the Strategy and Assets and Liabilities Management Committee of the eighth session of the Board | Four proposals, including the “Proposal in relation to the Authorisation of Investment in Single Asset Management Plan of the Company for the Year 2026”, were considered and approved. | ## Performance of Duties by the Strategy and Assets and Liabilities Management Committee In 2025, the Strategy and Assets and Liabilities Management Committee of the Board of the Company performed its relevant duties and functions in strict compliance with the “Procedural Rules for the Strategy and Assets and Liabilities Management Committee Meetings of the Board”. All members carefully reviewed the proposals on the three-year business plan of the Company, annual major asset allocation plan and authorisation, major fund application, and sustainable development, and listened to the report on the situation relevant to the assets and liabilities management for the previous year. All members diligently performed their duties. During meetings of the Strategy and Assets and Liabilities Management Committee of the Board, all members actively participated in discussions and proactively gave professional advices on the proposals considered and discussed at the meetings. --- Reviewing the annual asset allocation plan and entrusted investments of the Company. The Strategy and Assets and Liabilities Management Committee of the Board reviewed the proposals on the asset allocation plans of the Company, including the asset strategic allocation plan of the Company for the years from 2025 to 2027, the asset allocation plan of the Company for the year 2025, the Company’s budget for investment in fixed assets for the year 2025, the asset allocation plan for technical and business buildings and related authorisation of the Company for the year 2025, the authorisation of investment in single asset management plan of the Company for the year 2026, the authorisation of investment in financial products of the Company for the year 2026, the overseas investment plan of the Company for the year 2026 and related authorisation of investment, the interim amendments to the management guidelines on the investment by CLI under the entrustment of the Company for the year 2025, the authorisation for the adjustment to the percentage of equity investments by the Company in the open market, and the renewal of the “Asset Management Agreement” between the Company and AMC. Discussing the Company’s development plans and major strategic projects. The Strategy and Assets and Liabilities Management Committee of the Board reviewed the proposals on the medium- and long-term development plan and sustainable development of the Company, including the business plan of the Company for the years from 2025 to 2027, the evaluation report on the outline of the “14th Five-Year” development plan of the Company for the year 2024, the ESG and Social Responsibility Report of the Company for 2024, and the report on green finance of the Company for 2024. Listening to the report concerning assets and liabilities management of the Company. The Strategy and Assets and Liabilities Management Committee of the Board listened to the report on the situation relevant to the assets and liabilities management of the Company for the year 2024, and followed up to understand the overall management of assets and liabilities of the Company. ## CONNECTED TRANSACTIONS CONTROL COMMITTEE Currently, the Connected Transactions Control Committee of the eighth session of the Board comprises Ms. Chen Jie, Mr. Lam Chi Kuen, Mr. Zhai Haitao and Mr. Lu Feng, all being Independent Directors, with Ms. Chen Jie acting as the Chairperson. The principal duties of the Connected Transactions Control Committee of the Board are to confirm connected parties of the Company, manage, examine and approve connected transactions to control risks relating to connected transactions, and focus on the compliance, fairness and necessity of connected transactions, which provide an important basis for the Board’s decision-making in connected transactions management. ### Meetings and Attendance During the Reporting Period, nine meetings were held by the Connected Transactions Control Committee of the Board of the Company. Attendance records of individual members are as follows: | Name of member | Position | Number of meetings attended in person/Number of meetings required to attend | Number of meetings attended by proxies/Number of meetings required to attend | | :--- | :--- | :--- | :--- | | Chen Jie | Independent Director, Chairperson of the Connected Transactions Control Committee of the eighth session of the Board | 8/9 | 1/9 | | Lam Chi Kuen | Independent Director, member of the Connected Transactions Control Committee of the eighth session of the Board | 8/9 | 1/9 | | Zhai Haitao | Independent Director, member of the Connected Transactions Control Committee of the eighth session of the Board | 8/9 | 1/9 | | Lu Feng | Independent Director, member of the Connected Transactions Control Committee of the eighth session of the Board | 9/9 | 0/9 | Note: The number of meetings attended in person includes meetings attended on-site and by way of telephone or video conference. Directors who were unable to attend any meeting of specialised Board committees authorised other Directors to attend and vote at the meeting on their behalf. --- The meetings convened are as follows: | Meetings convened | Description | |-------------------|-------------| | **22 January 2025**
Third meeting of the Connected Transactions Control Committee of the eighth session of the Board | One proposal, namely the "Proposal in relation to the Renewal of the Agreement for Package Transactions on Bonds Distribution between the Company and China Life Asset Management Company Limited", was considered and approved. | | **17 February 2025**
Fourth meeting of the Connected Transactions Control Committee of the eighth session of the Board | Two proposals, including the "Proposal in relation to the Connected Transaction regarding the Investment by the Company in Project Chuangchi", were considered and approved. | | **25 March 2025**
Fifth meeting of the Connected Transactions Control Committee of the eighth session of the Board | Two proposals, including the "Proposal in relation to the 'Report on the Overall Status of Connected Transactions of the Company for the Year 2024'", were considered and approved, and one report, namely the "Report on Confirming the List of Connected Parties of the Company as of 31 December 2024", was debriefed. | | **28 April 2025**
Sixth meeting of the Connected Transactions Control Committee of the eighth session of the Board | One proposal, namely the "Proposal in relation to the Investment in Yinfa Fund Project", was considered and approved. | | **26 June 2025**
Seventh meeting of the Connected Transactions Control Committee of the eighth session of the Board | One proposal, namely the "Proposal in relation to the Connected Transaction regarding the Investment by the Company in Tianwan Fund Project", was considered and approved. | | **26 August 2025**
Eighth meeting of the Connected Transactions Control Committee of the eighth session of the Board | One proposal, namely the "Proposal in relation to the Purchase of the Company's Daily Financial Products by Connected Parties ", was considered and approved. | | **29 October 2025**
Ninth meeting of the Connected Transactions Control Committee of the eighth session of the Board | Three proposals, including the "Proposal in relation to the Execution of the 'Supplementary Agreement for Deposit Contract for RMB' between the Company and China Guangfa Bank Co. Ltd.", were considered and approved. | | **6 November 2025**
Tenth meeting of the Connected Transactions Control Committee of the eighth session of the Board | Two proposals, including the "Proposal in relation to the Execution of the 'Entrusted Investment and Management Agreement for Alternative Investments with Insurance Funds' between the Company and China Life Investment Management Company Limited", were considered and approved. | | **17 December 2025**
Eleventh meeting of the Connected Transactions Control Committee of the eighth session of the Board | Three proposals, including the "Proposal in relation to the Renewal of the 'Asset Management Agreement' between the Company and China Life Asset Management Company Limited", were considered and approved. | --- # Performance of Duties by the Connected Transactions Control Committee In 2025, the Connected Transactions Control Committee of the Board of the Company performed its duties and functions in strict compliance with the "Procedural Rules for the Connected Transactions Control Committee Meetings of the Board". During meetings of the Connected Transactions Control Committee of the Board, all members reviewed the proposals in relation to the connected transactions of the Company, fully understood the necessity, feasibility and relevant risks of connected transactions, actively participated in discussions and gave opinions. **Confirming connected parties of the Company.** The Connected Transactions Control Committee of the Board reviewed the "Report on Confirming the List of Connected Parties of the Company as of 31 December 2024" and reported to the Board in respect thereof. **Approving connected transactions.** The Connected Transactions Control Committee of the Board reviewed the proposals on major connected transactions, such as Project Chuangchi, Yinfa Fund Project, Tianwan Fund Project, CLI – Yuanzhi Fund Equity Investment Plan, the post-investment of Project Guoyue, and the matters associated with the second follow-on offering of Qihang Fund of the Company, fully studied and discussed the necessity, feasibility and major risks of the connected transactions, and made recommendations to the Board in respect thereof. **Approving framework agreements for daily connected transactions.** The Connected Transactions Control Committee of the Board reviewed the proposal on the execution of the "Supplementary Agreement for Deposit Contract for RMB" between the Company and CGB, the proposal on the execution of the framework agreement for daily connected transactions between the Company and China Life AMP, the proposal on the execution of the "Entrusted Investment and Management Agreement for Alternative Investments with Insurance Funds" between the Company and CLI, the proposal on the execution of the framework agreement for daily connected transactions between China Life AMP and CLI, the proposal on the renewal of the "Asset Management Agreement" between the Company and AMC, and the proposal on the renewal of the "Cooperation Framework Agreement for Investment Management with Insurance Funds" between the Company and China Life Capital, and fully reviewed the necessity, compliance and fairness of the daily connected transactions of the Company, which offered professional support to the Board's decision-making in a scientific manner. **Reviewing the implementation of the system for connected transactions management.** The Connected Transactions Control Committee of the Board reviewed the report on the overall status of connected transactions of the Company for the year 2024, and the proposal on the connected transactions of supplying commercial insurance or other daily financial products by the Company to its Directors, Supervisors and senior management and its connected parties. # INDEPENDENCE OF THE COMPANY FROM ITS CONTROLLING SHAREHOLDER **Employees:** The Company is independent in the aspects of employment, human resources and remuneration management. **Assets:** The Company owns all assets relating to the operation of its principal business. At present, the Company does not provide any guarantee for its shareholders. The Company's assets are independent, complete, and independent of the shareholders of the Company and other connected parties. **Finance:** The Company has established a separate financial department, and developed an independent financial accounting system and financial management system; further, the Company makes financial decisions on its own; it employs separate financial personnel, opens separate accounts with banks and does not share bank accounts with CLIC; the Company, as a separate taxpayer, pays taxes individually according to law. **Organisation:** The Company has established a well-developed organisational system, under which internal bodies such as the Board of Directors operate separately. There is no subordinate relationship between such internal bodies and the functional departments of the Company's controlling shareholder. **Business operations:** The Company independently develops personal insurance businesses, including life insurance, health insurance and accident insurance businesses; reinsurance relating to the above insurance businesses; funds application business permitted by applicable PRC laws and regulations or approved by the State Council; as well as all types of personal insurance services, consulting business and agency business; sale of securities investment funds; and other businesses approved by the insurance administrative and regulatory authorities of the PRC. The Company currently possesses the "Insurance Permit" (institution number: 000005) issued by an insurance administrative and regulatory authority. The Company is independently engaged in the businesses as prescribed in its business scope according to law, has separate sales and agency channels and is licensed to use licensed trademarks without consideration. The completeness and independence of the Company's business operations will not be adversely affected by its relationship with connected parties. --- # PERFORMANCE APPRAISAL AND INCENTIVES FOR SENIOR MANAGEMENT The Company implements a term-of-service and target-related responsibility system for senior management. Performance target contracts are entered into between the Chairman of the Board and the President, and between the President and other senior management of the Company. The performance target contract system is an important tool in disassembling the strategic goals of the Company in a scientific manner, which is conducive towards the breakdown of targets and transmission of responsibility, enhancing the implementation capability of the Company and ensuring the successful completion of its annual business targets. The performance appraisal criteria listed in the individual performance target contracts of senior management are partially linked to the business targets of the Company and partially formulated with reference to the duties and functions of their respective positions. The remuneration for senior management mainly comprises position compensation, performance rewards, welfare benefits and medium- and long-term incentives. A mechanism for the recovery and deduction of performance-based remuneration is also established to balance the relationships between the current and long-term needs as well as the revenue and risk by making full use of remuneration tools. # SHAREHOLDERS’ INTERESTS To safeguard shareholders’ interests, in addition to the right to participate in the Company’s affairs by attending shareholders’ general meetings, shareholders have the right to convene extraordinary general meetings under certain circumstances. If the number of Directors is less than the number stipulated in the Company Law or two-thirds of the number specified by the Articles of Association, or the uncovered losses of the Company amount to one-third of the total amount of its share capital, or shareholders individually or jointly holding more than 10% of the Company’s voting shares make a requisition, or if the Board deems necessary or a majority of all Independent Directors approves or the Audit Committee of the Board so requests, the Board shall convene an extraordinary general meeting within two months upon the occurrence of such circumstances. Where shareholders individually or jointly holding more than 10% of issued and outstanding voting shares of the Company propose to convene an extraordinary general meeting, they shall make such proposal to the Board in writing. The Board shall give a written response on whether such proposal is consented to within ten days from the date of receipt of such proposal. Where the Board does not agree to convene an extraordinary general meeting, or fails to give a response within ten days from the date of receipt of such proposal, shareholders who individually or jointly hold more than 10% of voting shares shall have the right to propose to the Audit Committee of the Board to convene an extraordinary general meeting in writing. If the Audit Committee of the Board agrees to convene an extraordinary general meeting, it shall give a notice on convening the extraordinary general meeting within five days from the date of receipt of the proposal. For any change to the original proposals stated in the notice, it shall be deemed that the Audit Committee of the Board fails to issue notice of an extraordinary general meeting within the prescribed period, it shall be deemed that the Audit Committee of the Board fails to convene and preside over the extraordinary general meeting, shareholders individually or jointly holding more than 10% of voting shares for over ninety consecutive days may convene and preside over such meetings by themselves. In accordance with the Articles of Association, when the Company convenes the shareholders’ general meeting, shareholders individually or jointly holding more than 1% of the shares of the Company shall have the right to propose motions to the Company in writing. The Company should include such matters that fall into the scope of the functions and powers of the shareholders’ general meeting in the agenda of the meeting. Shareholders individually or jointly holding more than 1% of the shares of the Company may propose provisional motions in writing to the convenor ten days prior to the convocation of a shareholders’ general meeting. The provisional motions shall fall into the scope of the functions and powers of the shareholders’ general meeting and specify explicit topics and specific resolutions. --- Shareholders may put forward enquiries to the Board through the Board Secretary or the Company Secretary, or put forward proposals at shareholders’ general meetings through their proxies. The Company has made available its contact details in its correspondence with shareholders to enable such enquiries or proposals to be properly directed. # CORPORATE CULTURE The Company firmly upholds the corporate value of “success for you, success by you” and the business philosophy of “One China Life, safeguarding you for life”. Rooted in a financial culture with Chinese characteristics, it incorporates such culture across corporate governance and business operations, and continuously converts cultural soft power into a robust foundation for driving high-quality development and fortifying risk defense. In 2025, with the implementation of the “Project Plan for Building Financial Culture with Chinese Characteristics” as its main guideline, the Company systematically advanced innovation in cultural theory, practice transformation, and communication and guidance, continually enhancing endogenous development momentum and cultural identity. The Company launched and upgraded corporate culture system, and systematically distilled and interpreted the core cultural genes underpinning its enduring success, so as to establish clear guidelines for cultural inheritance and innovation. Adhering to a research-first approach, the Company produced an objective and comprehensive cultural diagnostic report to support precise policy measures. With a focus on “cultural translation”, it realised the critical shift from value advocacy to concrete codes of conduct, guiding all employees to calibrate behaviours and align consensus. The Company formed the inaugural “Financial Culture Lecturers Group”, continuously collected and promoted exemplary cases, thereby enhancing the external influence and reputation of its cultural brand and fostering a positive cultural atmosphere characterised by internal-external synergy and upward momentum. # INFORMATION DISCLOSURE AND INVESTOR RELATIONS The Company has established a well-developed, effective and practical information disclosure management system in strict compliance with the regulatory laws and regulations, relevant rules and self-regulatory requirements of its listed jurisdictions and the insurance industry, constantly enhanced the quality of information disclosure on the basis of strict compliance with laws and regulations, and continued to improve the effectiveness of information disclosure and transparency of information. Focusing on investor concerns, the Company has continued to deeply engage in making disclosure of information that have significant impacts on investors’ value judgments and investment decisions, enriched the contents of information for voluntary disclosure, and provided the capital market and investors with simple and clear, more targeted and effective information, for the purpose of facilitating investors, especially medium and small investors, to better understand the Company’s strategies and business highlights, and ensuring that investors obtain true, accurate and complete information in a compliant and effective manner. The Company has also regularly organised training courses and promotional activities relating to the relevant rules of information disclosure and corporate governance. It has properly arranged information disclosure on the basis that the differences between the laws and regulations of its listed jurisdictions in the PRC and overseas, and the differences between the regulatory requirements of its listed jurisdictions and the insurance industry, are well defined. The Company has strictly managed its inside information and carried out the registration and filing procedures on persons who have knowledge of inside information in compliance with law, strengthened the confidentiality of inside information, and safeguarded the legitimate rights and interests of investors, with a view to maintaining the fairness, impartiality and openness of information disclosure of the Company. In 2025, the Company was awarded Grade A in the assessment by the SSE of information disclosure of listed companies for the year of 2024-2025. --- The Company has attached great importance to its contact and communication with domestic and overseas investors, and developed investor relations in a proactive way with its stringent attitude and innovative thinking. It has kept abreast of the pace of technological development, consistently made innovation in its communications with and services to investors, and offered various channels to facilitate such investors in keeping abreast of any major business development of the Company in a timely manner. The Company has set up the "Investor Relations" section on its official website at www.e-chinalife.com and operated the "China Life Investor Relations" WeChat public account and mini program, to facilitate investors in accessing announcements, operating results materials and other information for public disclosure as published by the Company on the stock exchanges of its listed jurisdictions in the PRC and overseas. In addition, the Company has responded to relevant inquiries from investors in a timely manner via the investor relations hotline at 86-10-63631241 and the investor relations email address at ir@e-chinalife.com. In 2025, the Company held four results briefings and three shareholders' general meetings, to facilitate convenient and open interaction with all shareholders through online live broadcasts or offline meetings, with the Chairman, President, Independent Directors, and senior management members of the Company participating in these activities multiple times. The senior management of the Company also communicated offline with nearly 100 domestic and overseas institutional investors through non-deal roadshows for annual and interim results. Further, the Company constantly enhanced the efficiency of communication between the Company and the capital market through a variety of communication channels and means, including holding online and offline conferences with investors and analysts, attending investors' meetings, timely updating information on the diversified digital platform, and responding to inquiries from investors and analysts. The Company's investor relations team followed up on shareholder interactions through meetings with investors and analysts. The Company also focused on the protection of medium and small investors, actively responded to any inquiries from them, and kept in close contact with investors by various means such as email, phone and internet. On 26 March 2025, the "Measures for Market Value Management of China Life Insurance Company Limited" was considered and approved at the thirteenth meeting of the eighth session of the Board of Directors of the Company to further enhance efforts related to market value management. The Company reviews its policy for communication with shareholders once a year and considers that such policy remains effective based on the feedbacks received from investors and the capital market on investor relations. # CHANGES OF THE ARTICLES OF ASSOCIATION During the Reporting Period, in order to enhance the corporate governance system and comply with laws, regulations, and the standards of external regulators, and having taken into account its own governance practices, the Company has made amendments to the Articles of Association in accordance with the Company Law, the "Guidelines on the Articles of Association of Listed Companies" issued by the CSRC, and other relevant laws, regulations, and regulatory requirements. Please refer to the related content published by the Company on 24 December 2025 on the HKEXnews website of Hong Kong Exchanges and Clearing Limited for the amended Articles of Association. # TRAINING OF COMPANY SECRETARY Mr. Heng Victor Ja Wei, the Company Secretary, took no less than 15 hours of relevant professional training in 2025, satisfying the requirements under the Listing Rules. # INTERNAL CONTROL AND RISK MANAGEMENT ## Internal Control The Company has consistently proceeded with tasks in compliance with the regulatory requirements of relevant regulatory authorities, such as the SSE and the HKSE, with respect to corporate internal control. The Company has been devoting significant effort to the promotion of internal control and the construction of internal control-related systems. In accordance with the requirements of the "Standard Regulations on Corporate Internal Control", the "Implementation Guidelines for Corporate Internal Control", the "Rules Governing the Listing of Securities on The Stock Exchange of Hong Kong Limited", and the "Basic Standards of Internal Control for Insurance Companies" issued by the NFRA, the Company has carried out a lot of work on its internal control system construction, rules implementation and risk management by centering on its corporate governance structure. The Company has also formulated and issued the "Internal Control Implementation Manual of China Life Insurance Company Limited (2025 Edition)" to strengthen the implementation of internal control standards and internal control assessments, and actively promoted the culture and philosophy of internal control, thereby continuously enhancing the internal control of the Company. --- Pursuant to the relevant requirements of the SSE, the Company is required to release a report on the internal control assessment simultaneously with the publication of its 2025 annual report. The Company has completed the internal control self-assessment as required by the SSE for the year ended 31 December 2025. Such assessment is conducted on an annual basis and in two stages, namely, interim assessment and supplementary test. The Company has confirmed after the assessment that the relevant internal controls were effective. The Company has also received from its independent auditors an unqualified opinion on the effectiveness of its internal controls in relation to financial reporting as at 31 December 2025. The Company’s assessment report and the report of its independent auditors will be included as an attachment to its annual report submitted to the SSE. It is the responsibility of the Board of the Company to establish and effectively implement well-established internal control systems, assess their effectiveness and disclose the report on the internal control assessment. The Board of the Company is responsible for leading the implementation of internal control measures of the Company, and the Audit Committee is responsible for supervising and assessing the internal control. The Company has established the Risk Management Department in its headquarters and branches, which conducts tests on the management level, assesses the effectiveness of the establishment and implementation of internal control systems in accordance with the regulatory requirements of the jurisdictions where the Company is listed, and reports to the Board, the Audit Committee and the management. In compliance with regulatory requirements and having considered the characteristics of its business and management requirements, the Company has established and implemented a series of internal control measures and procedures with respect to currency and funds, insurance business, external investments, physical assets, information technology, financial reporting and information disclosure to ensure the safety and integrity of its assets. By strictly complying with relevant PRC laws and regulations as well as the internal rules and regulations of the Company, the quality of accounting information has been improved. A relatively well-developed internal control system has been established in terms of team-building, sales and operations, and system management for the sales channels, such as individual insurance, bancassurance, group insurance and health insurance. This internal control system regulates the relevant authorisations and operational workflows, and effectively adopts the measures to prevent and manage risks relating to the operation of exclusive agents. The Company has promulgated clear regulations for the workflows and authorisations relating to the verification of insurance policies, insurance claims and insurance preservation. The Company has also formulated business operation standards and service quality standards, developed systems of business, document and file management, and further regulated the management of business approval authority to strengthen its control over business risk and improve the quality of its services. In accordance with relevant laws and regulations such as the “Accounting Law of the People’s Republic of China” and the “Enterprise Accounting Standards — Basic Standards” and specific standards and taking into account the needs of the Company for its business development, operation and management, the Company has formulated and issued the “Accounting System of China Life Insurance Company Limited”. The accounting units of the Company at all levels have implemented this in strict compliance with the requirements of the accounting system and various basic systems to regulate work relating to financial accounting and preparation of financial reports. The accounting units of the Company at all levels have assigned positions in a reasonable manner, clearly defined duties and responsibilities of such positions and their scope of authority on management, and strictly prohibited employees from serving incompatible positions concurrently, thus exercising control over financial risks in an efficient manner. The Company has created a rigorous information disclosure system with well-developed workflows, including the provisions governing the basic responsibilities of periodic report disclosures, the major errors in periodic report disclosures and the responsibility attribution as set forth in the “Rules for the Administration of Information Disclosures of China Life Insurance Company Limited”. As at the end of the Reporting Period, there were no major errors in periodic report disclosures of the Company. The “Measures for the Administration of Registration of Persons Who Have Knowledge of Inside Information of China Life Insurance Company Limited” has been introduced to enhance the confidentiality of inside information of the Company and to register and submit information concerning persons who have knowledge of inside information. The relevant requirements under the “System of Internal Reporting of Material Information of China Life Insurance Company Limited” have been incorporated into the indicator system under the internal control report of the Company. Persons responsible for reporting material information obtain and identify potential material information at the level of operation and management by making use of various information technologies, and submit and report such information to the President and the Board of the Company as early as possible. The Board then makes the final decision on whether to release the material information, and discloses the same to such extent as it considers reasonable and practicable. --- The Company has established a well-developed system relating to investment decisions in accordance with the relevant laws and regulations and based on the actual situation of investment management. The system defines the approval and decision-making authority, authorisation mechanism and specific decision-making procedures for investment management. All major investment decisions shall be approved and implemented in strict compliance with the internal decision-making process of the Company and the requirements of its investment management system. The Investment Decisions Committee is a permanent body of the Company for investment decisions, which is responsible for reviewing major investments and providing support to any investment decisions made by the management. The Company has established a comprehensive information technology system to cover all aspects of IT work and formed a closed-loop control mechanism focusing on centralised review and publication, periodic inspection and continuous improvement. By conducting measures such as the inspection and evaluation of system implementation on a regular basis, the Company has facilitated the effective implementation of the system and enhanced the standardisation and normalisation of various IT work. Further, the Company has constantly promoted the construction of the systems for information safety and risk control, and formulated and implemented a series of effective information safety control measures at various stages of the life cycle of the IT system, thereby effectively ensuring the safe and steady operation of the Company. In 2025, the Company conducted several internal and external safety and risk assessments to promote construction by inspection, with a view to consistently enhancing its capability in management and control of information safety risks. The Risk Management Department, the Audit Department and the Legal and Compliance Department of the Company are responsible for the supervision and inspection of the Company's internal control measures. The Company identifies issues in the areas of system design, control implementation and risk management in a timely manner through the adoption of various measures such as walk-through tests, control tests and risk analysis. It also eliminates loopholes, guards against risks and reduces losses by adopting various measures to improve systems, enhance legal compliance and pursue accountability. In 2025, the Company actively adapted to the stringent financial regulatory environment both domestically and internationally and strictly complied with the regulatory requirements to constantly improve the organisational structure of internal audit, and further strengthened the mechanism for internal audit management, which effectively performed the supervisory role of audit. The Company carried out the economic responsibility audit on its key responsible persons at all levels, the senior management audit on part of senior management of its headquarters and deputy heads of its branches at the provincial level, organised and performed a series of special audits closely related to the Company’s business objectives, and conducted a variety of special audits on anti-money laundering, connected transactions, assets and liabilities management, solvency risk management system, application of funds, protection of consumers' rights and interests, and risk management of financial derivative transactions pursuant to regulatory requirements. Meanwhile, the Company has put more efforts on the application of audit results, consistently strengthened the supervision and direction of rectification measures for any issues identified in audits, handover of the issues concerned and the responsibility attribution, proceeded with the integration of rectification measures, further improved the closed-loop management of internal audits, and facilitated its standardised management and compliant operations. The Company has continued to deeply engage in building a law-based company, leveraging high-quality and efficient compliance management to promote operations, guard against risks and create value. The Company has also actively fostered the financial culture with Chinese Characteristics, firmly established the philosophy of compliant operations, strengthened and enhanced its compliance management system, improved the organisational structure for compliance management, reinforced the management of policies and systems, and optimised the compliance operating mechanism, with a view to effectively identifying, guarding against and mitigating compliance risks, and enhancing its capability of compliance management. In September 2025, the Company successfully passed the second supervisory audit for certification under the national standard GB/T 35770-2022 and the international standard ISO 37301: 2021. --- # Risk Management ## Risk Management System The Company has established an organisational system for comprehensive risk management in which the risk management department, as the primary responsible party, is to enlist the close cooperation of relevant functional departments, under the direct leadership of the management, and the Board assumed the ultimate responsibility. Specifically, the system is composed of a 5-tier structure, covering the corporate governance level, the headquarters level, the provincial branches level, the municipal branches level, and the county sub-branches level. With the reliance on the 5-tier risk management and control structure, the Company has put in place three lines of defense that focus on risk management: the first line of defense consists of branches and sub-branches at all levels and various functional departments that identify, assess, address, monitor and report risks at the front end of business; the second line of defense is composed of the Risk Management and Consumer Rights Protection Committee of the Board, as well as the Risk Management Committee and the Risk Management Department of the Company that take the lead in formulating the system, standards and limits for a variety of risks and make recommendations to address such risks; the third line of defense comprises the Audit Committee of the Board, as well as the internal audit department, the Office of the Discipline Inspection Committee and other departments of the Company that supervise the risk management workflows established by the Company and the procedures and actions for control of various risks. The three lines of defense have been coordinated with each other in a proactive manner to organise and commence any work in relation to risk management. By establishing the organisational structure of risk control, the Company has gradually established a criss-cross network of risk control systems, with the risk management departments at all levels as leading bodies, the relevant functional departments as main bodies, the vertical decision-making control system and horizontal interactive collaboration mechanism as supporting systems and the comprehensive risk management as focus, thus laying a strong foundation for the Company to achieve a comprehensive risk management system with full coverage, all-employee participation and effective workflows. ## Work in relation to Risk Management Pursuant to the requirements of the NFRA on the C-ROSS, the Company pushed forward the solvency risk management system construction, and built a "1+7+N" comprehensive risk management system with the "Comprehensive Risk Management Rules" as the general principles, seven types of risks (including insurance risk, market risk, credit risk, operational risk, strategic risk, reputational risk and liquidity risk) as the key focuses, and having reliance on a series of implementing rules for business such as the "Measures for the Administration of Risk Appetite System". The Company consistently reinforced the mechanism for formation, transmission and application of the risk appetite system, creating a system for the normal management of risk appetite with the statement on risk appetite as the carrier, and the risk tolerance and limit indicators as the focus. Through the combination of risk appetite with various lines of operation and management, the Company maintained a good interaction between risk management and business development. The Company conducts a self-assessment on solvency risk management capability every year so as to fully assess all work in relation to risk management from the soundness of the system and the effectiveness of its implementation. The Company conducted specific rectification against its own shortcomings and weaknesses, which enhanced its risk management standard in all aspects. In the SARMRA under the C-ROSS (Phase II) Regulation conducted by the NFRA, the Company's capability of solvency risk management ranked among the top of life insurance companies. The Company followed the requirements under anti-money laundering laws and regulations, kept on improving the system for money-laundering risk management and performed the anti-money laundering obligations under the law, with a view to enhancing both the quality and efficiency of its anti-money laundering work. In 2025, the Company updated its internal control management system of anti-money laundering in all aspects in accordance with the requirements of the newly revised "Anti-Money Laundering Law". Meanwhile, pursuant to external regulatory requirements, the Company carried out self-inspections and rectifications in key risk areas, which effectively improved its precautionary capabilities in these areas. In 2025, the Company made continuous efforts to advance the informatisation of risk management and actively applied advanced technologies such as big data and artificial intelligence, to enhance the intelligence of its money-laundering risk management. Its digitalised and intelligent management application for anti-money laundering won the third prize in the management application category at the Second China Life Science and Technology Progress Awards. With significant advancements in areas such as intelligent pre-warning systems for sales risks and the integrated risk management platform, the informatisation and intelligence level of risk management were substantially elevated, which provided robust support for the high-quality development of the Company. ## Risk Identification and Control The major risks of the Company in the course of business operation and management include insurance risk, market risk, credit risk, operational risk, strategic risk, reputational risk, liquidity risk, information safety risk, ESG risk and insurance fraud risk. --- # Insurance Risk Insurance risk refers to the risk that exposes insurance companies to unexpected losses due to the adverse deviation of the actual situation from the projections of assumptions such as loss ratio, expense rate and lapse rate. The Company assessed and monitored insurance risks through sensitivity analysis and other actuarial appraisal methods, with a focus on the impact of mortality rate, morbidity rate, lapse rate, expense rate and other relevant assumptions on the Company’s operating results. The Company managed insurance risks through the following mechanisms and processes: 1. establishing an organisational structure and a system for insurance risk management, so that insurance risk management can be performed within a scientific, comprehensive and effective management system; 2. devising a system for risk limit indicators and carrying out normal monitoring analysis, so as to contain risks within a controllable range; 3. implementing an effective product development and management system to strictly control product pricing risks, and strengthening empirical analysis to offer support to pricing assumptions and assessing assumptions, in order to prevent and control insurance risks from the front end of products; 4. effectively guarding against adverse selection risks and insurance frauds through the establishment and implementation of a well-developed system for verification of insurance policies and claims, as well as the practical operation regulations; 5. transferring and mitigating insurance risks through a scientific and reasonable reinsurance arrangement; and 6. strengthening expenses management and enhancing efficiency in resource utilisation. In 2025, the Company managed insurance risks in a regulated and orderly manner, with sufficient and reasonable provisions of minimum capital for insurance risks. The Company will continuously keep a watch on the development trend of insurance risks and further enhance its capability of managing insurance risks. # Market Risk Market risk refers to the risk that exposes the Company to unexpected losses due to adverse movement in (among others) interest rate, equity prices, real estate prices and exchange rates. In order to address the market risks, the Company continued to pay attention to the risk exposures of interest rates, equity prices, real estate prices and exchange rates, monitored value at risk/mark to market (VaR/MTM), yield volatility, duration and other key market risk indicators on a regular basis, set up a 2-tier risk limit indicator and corresponding threshold values, carried out sensitivity analyses and stress tests to measure the risk losses to the Company under stress scenarios, gave pre-warning of market risks and formulated contingency plans for emergencies. Currently, the proportion of each investment asset is in line with the requirements of the NFRA and the internal management provisions of the Company. According to the results of the risk indicator monitoring and stress tests, the market risk of the Company was within a normal controllable range. The Company primarily adopted the following risk control measures in 2025: 1. stepping up efforts on the study of macro economy, currency and financial policies to assess domestic and international economic and market trends in a timely manner; 2. reviewing the risks of major assets categories and the characteristics of their returns on a regular basis, so as to constantly optimise the model of asset allocation; 3. constantly tracking and assessing open market equity exposure and making reasonable allocations; 4. enhancing asset-liability interaction and effectively managing the gap arising from the duration mismatch of assets and liabilities; 5. facilitating the advancement of systems to improve risk monitoring and pre-warning functions; and 6. consistently reinforcing efforts to identify and monitor investment concentration risk and diversifying risks in a reasonable manner. # Credit Risk Credit risk refers to the risk that exposes the Company to unexpected losses due to non-performance or delay in the performance of contractual obligations by counterparties, or adverse changes in their credit standings. The credit risks that the Company is exposed to mainly relate to investment deposits, bond investments, non-standard financial product investments and reinsurance arrangements, etc. ## Credit Risk of Investment Business To address the credit risks of investment business, the Company developed and continuously improved the organisational structure of credit risk management, and constantly optimised the process for credit risk management. Meanwhile, the Company established and made amendments to the management system and strengthened the implementation of such a system pursuant to the regulatory requirements and management practices, strengthened the research on risks, and kept on improving risk analysis, assessment, monitoring, pre-warning and emergency response standards. By relying on information technology, the Company consistently enhanced the standard of quantitative analysis on credit risks and diversified the methods used for risk management and control. The Company primarily adopted the following measures in 2025: 1. further improving the centralised credit rating process and system functions to enhance the credit risk management standard; 2. optimising the credit risk limit management system in multiple dimensions to improve the mechanism for prevention of credit risks prior to investment; 3. strengthening the monitoring of credit risk indicators for the purposes of indicating risk exposure and any change of risk distribution in an effective manner and closely tracking down negative information; and 4. deepening efforts on the research of key industries and key regions, and the credit risk outlook to enhance the capability of the Company in risk management and control during and after investment. --- ## Reinsurance Credit Risk Reinsurance credit risk refers to the credit risk that may possibly be faced by the Company in connection with the obligations to be undertaken by reinsurers due to their failure to perform reinsurance contracts. To address the reinsurance credit risks, the Company adopted the following measures: 1. properly setting self-retained risk limits through an effective reinsurance management system, and using reinsurance as an effective tool to transfer risks to reinsurers with a high level of solvency; 2. reviewing the relevant information of a reinsurer in the reinsurance registration system in strict compliance with the regulatory requirements prior to the execution of a reinsurance contract to ensure that the reinsurer in cooperation with the Company complies with the regulatory requirements; and 3. conducting credit assessments on reinsurers through internal rating to select reinsurers that have higher credit standing to mitigate credit risks. ## Operational Risk Operational risk refers to the risk of losses arising from the issues found in internal procedures, employees and IT systems, as well as external events. The Company consistently implemented regulatory requirements and its operational risk management strategies, optimised the operational risk management system, and regulated the operational risk management processes, so as to enhance the effectiveness of operational risk management on an ongoing basis. The Company established an operational risk management structure grounded in close cooperation among three lines of defense, built a core suite of management tools comprising the self-assessment of operational risk, loss database for operational risks and key risk indicators, and further reinforced the management requirements for branches, in order to facilitate the deeper and vertical coverage of the operational risk management network and achieve the integration of operational risk management and control with its business development. The operational risk control measures adopted by the Company mainly included the following: 1. developing an operational risk management process and method compatible with the nature, scale and risk characteristics of the Company’s business, including the identification, assessment, monitoring, control and reporting mechanisms; 2. establishing a loss database for operational risks to carry out the loss data collection and analysis of operational risks on a regular basis; 3. establishing a key risk indicator library to conduct regular monitoring of the key risk indicators and taking relevant control measures against them; 4. conducting self-assessments on operational risks and their control measures on a regular basis and identifying any areas in the management and control of operational risks that were vulnerable, with a view to constantly increasing the capability of the Company in operational risk management; and 5. fostering a culture of operational risk management by organising and conducting training courses on operational risk management. In 2025, the operational risk management system of the Company operated in a sound and stable manner, with satisfactory management performance, and losses from risks were controllable. As the management foundation of the Company was consistently solidified, the quality and efficiency of its risk management were further enhanced. ## Strategic Risk Strategic risk refers to the risk of mismatch between strategies, market conditions and capabilities of the Company arising from ineffective formulation or implementation of strategies or changes in operational environment. The Company set up a relatively well-developed system for strategic risk management, and established an organisational system for strategic risk management with the ultimate responsibility assumed by the Board, under the direct leadership of the management and with the division of labour and collaboration among the relevant functional departments. In 2025, the Company enhanced its strategic study concerning macro economy, regulatory policies and industry developments, among others. In response to changes in the external development and environment, it continuously optimised its development strategies by strengthening the management of both business and investment strategies. The Company systematically planned the future-oriented tasks for comprehensively deepening reforms, accelerated reforms in key areas, cultivated new growth drivers, and improved core competitiveness to ensure alignment between its strategies and capabilities. Meanwhile, the Company further optimised the work mechanisms and processes for strategic study, formulation, implementation and assessment. It strengthened daily monitoring and analysis of the system for strategic risk indicators, and created a closed-loop strategic risk management system through diverse initiatives, thereby ensuring effective implementation of strategic risk management. In 2025, the Company continued to enhance the robustness of its strategic risk management system and the effectiveness of its implementation. With good alignment between its strategy, the market environment, and the Company’s capabilities, the achievements in strategic risk management were significant, thus contributing to improvements in the scale, value, growth, quality, structure, efficiency and safety of its business and operations. --- # Reputational Risk Reputational risk refers to the risk of negative comments on the Company from stakeholders, the public and the media as a result of the behaviours of the Company's divisions at all levels, practitioners or external events, thereby causing losses, damaging brand value, being detrimental to the normal operation of the Company, and even affecting market and social stability. Reputational risk may exist in any aspect of the Company's operation and management. The Company highly values its reputation and has incorporated reputational risk management into the corporate governance and comprehensive risk management system to prevent reputational risk. In 2025, the Company made further improvement to its system for reputational risk management and reinforced accountability for primary responsibilities across all parties, so as to enhance the standard of reputational risk management on an ongoing basis. The Company consistently proceeded with all tasks across the entire process, such as the identification, evaluation and disposal of reputational risks, so as to prudently and properly address and dispose of any reputational incidents and effectively protect the brand's reputation. It constantly optimised disposal mechanisms, innovated and diversified management tools and measures, explored approaches for engagement within the public-opinion arena, and established a multi-stakeholder collaborative framework, thereby effectively improving the quality and efficiency of incident disposal. Maintaining a focus on source control of reputational risk, the Company conducted ongoing reputational risk investigations and rectifications, and, for key issues and high-risk areas, formulated dedicated work plans and targeted investigation tasks to further enhance governance at the source. Multi-dimensional training and exercises were conducted to reinforce awareness of reputational risks among all employees and foster a strong culture of reputational risk management. # Liquidity Risk Liquidity risk refers to the risk that the Company does not have access to sufficient funds in time or at reasonable costs to meet its liabilities or other payment obligations as they become due. The Company established a system for liquidity risk management to define the organisational structure and responsibilities of liquidity risk management. Further, the Company developed the processes covering the identification, evaluation, monitoring, response and disposal, reporting, and rectification of liquidity risk, and organised regular emergency exercises on liquidity risks. Overall, the liquidity risk of the Company was insignificant. The Company will constantly step up its effort on liquidity risk management pursuant to the regulatory requirements and its own provisions to ensure the performance of its obligation to give insurance benefits as scheduled. # Information Safety Risk Information safety risk refers to the operational, legal and reputational risks caused by natural factors, human factors, technological loopholes or management defects in the process of applying information technology in the Company. The Company attached great importance to information safety risk management. Firstly, the Company set up organisational support for information safety. It established an organisational system for internet security across the Company. An Internet Security and Informationisation Commission and an Information Safety Committee were established at the headquarters level for organising the information safety risk management of the Company. A leading group and working group of information safety were established at all levels of divisions for the specific implementation of information safety. Secondly, the Company developed and strictly implemented various systems and mechanisms to ensure the standardisation of information management. Thirdly, the Company optimised the safety management requirements for the full life cycle of its IT system. By conducting safety tests and quality checks on the IT system before and after it was put online, the Company consistently enhanced the safety of such system. The Company also formulated contingency plans of the IT system for regular exercises to enhance its emergency response capability. With the help from the enterprise general control center, the Company developed a joint prevention and joint control mechanism for the entire network, thus achieving the centralised analysis and coordinated disposal of various safety risks. In addition, the Company constantly stepped up efforts on, among others, awareness training, promotion and education, and phishing simulation to raise the information safety awareness of employees, which fostered a corporate culture of "everyone places emphasis on safety". In 2025, there was no circumstance where the Company's operation was affected due to the breakdown of computers or security breach. --- In 2025, the Company fully implemented the legal provisions of national laws such as the "Data Security Law", the "Personal Information Protection Law", and the "Measures for the Administration of Data Security of Banking and Insurance Institutions" to strictly protect critical data and personal information, so as to safeguard the legitimate rights and interests of customers. Firstly, the Company refined its governance structure by establishing and improving its data security governance system, optimising data management policies and standards, clarifying roles and responsibilities for data security management across all organisational levels, and promoting the implementation of a data security accountability system. Secondly, it strengthened data security management for the full life cycle. By optimising standards for data classification and categorisation management and strategies for data security protection, conducting pre-assessment, in-process control and post-event monitoring of data security risks associated with data processing activities, the Company effectively implemented tiered security protection measures throughout the data life cycle, including data collection, transmission and storage. Thirdly, it enhanced risk disposal capabilities. The Company continuously improved data security risk monitoring and early-warning mechanisms, refined data security emergency response plans and conducted regular drills, thereby consistently improving emergency response capabilities. The Company facilitated data development and utilisation while maximising data value, all under the assurance of data security. ## ESG Risk The Company conducts an ESG materiality assessment annually, taking into account changes in the external economic, social and macro environment as well as its own development strategy, to comprehensively identify potential risks and opportunities in the ESG domain. The assessment results are reviewed and confirmed by the Board, after which the key issues are incorporated into the overall strategy planning of the Company, with ongoing oversight of their management and performance. In 2025, the Company further strengthened its ESG risk management, through which five key risk areas, namely information safety, climate change, corruption, human capital and customer relationship management, and talent attraction and retention, were identified. The Company also formulated specialised management strategies for these risks, implemented dynamic tracking and risk early-warning mechanisms, thus ensuring timely responses to changing risk trends and effectively preventing and mitigating potential risks. In 2025, the Company conducted its first climate risk stress test, adopting NGFS climate scenarios to perform a comprehensive analysis of physical risks and transition risks across operations and investments. The results indicated that climate risks had a relatively limited impact on the Company. The Company adopted targeted measures to effectively address climate risks. For details, please refer to the section headed "Upholding Climate Commitments to Support Steady Growth" in the Environmental, Social and Governance (ESG) and Social Responsibility Report for 2025. ## Insurance Fraud Risk The Company promoted the insurance fraud risk management on an ongoing basis, played an active role in increasing the awareness of insurance fraud risk prevention, and proceeded with all tasks against insurance frauds in an effective manner. The Company has established an organisational system for insurance fraud risk management with the ultimate responsibility assumed by the Board, under the direct leadership of fraud risk managers and with the close cooperation among the functional departments. With its implementation of comprehensive risk management, the Company identified control points in a variety of business activities for insurance fraud risks. The Company also proceeded with all tasks against insurance frauds in active cooperation with regulatory authorities and industry associations, and attached great importance to fostering anti-insurance fraud culture through education on anti-insurance fraud alert and promotion. As a result, the capability of insurance fraud risk prevention and control of the Company was effectively improved. For other analysis on the insurance risk, market risk, credit risk and liquidity risk of the Company, please refer to the "Risk Management" section in the Notes to the Consolidated Financial Statements of this annual report. It should be stated that the risk management and internal control of the Company are designed with the objectives to reasonably ensure the legal compliance of business operation and management, safety of assets, truthfulness and completeness of financial reports and relevant information, improvement of operating efficiency and effect, and accomplishment of development strategy. Given the inherent limitations on risk management and internal control, the Company can only provide reasonable assurance with respect to the accomplishment of the above objectives. --- # OTHER INFORMATION ## BASIC INFORMATION OF THE COMPANY | Item | Details | | :--- | :--- | | **Registered name in Chinese** | 中國人壽保險股份有限公司（簡稱「中國人壽」） | | **Registered name in English** | China Life Insurance Company Limited (“China Life”) | | **Legal representative** | Li Mingguang | | **Registered office address/ Current office address** | 16 Financial Street, Xicheng District, Beijing, P.R. China (On 21 October 2010, the registered address of the Company was changed from No.16 Chaowai Avenue, Chaoyang District, Beijing, P.R. China to the current address) | | **Postal code** | 100033 | | **Telephone** | 86-10-63633333 | | **Investor relations hotline** | 86-10-63631241 | | **Customer service hotline** | 95519 | | **Fax** | 86-10-66575722 | | **Website** | www.e-chinalife.com | | **Email** | ir@e-chinalife.com | | **Hong Kong office address** | 16/F, Tower A, China Life Centre, One Harbour Gate, 18 Hung Luen Road, Hung Hom, Kowloon, Hong Kong | | **Telephone** | 852-29192628 | --- # CONTACT INFORMATION | | Board Secretary | Securities Representative | | :--- | :--- | :--- | | **Name** | Liu Hui | Li Yinghui | | **Office address** | 16 Financial Street, Xicheng District, Beijing, P.R. China | 16 Financial Street, Xicheng District, Beijing, P.R. China | | **Telephone** | 86-10-63631241 | 86-10-63631191 | | **Fax** | 86-10-66575112 | 86-10-66575112 | | **Email** | ir@e-chinalife.com | liyh@e-chinalife.com* | \* Ms. Li Yinghui, Securities Representative of the Company, is also the main contact person of the external Company Secretary engaged by the Company # INFORMATION DISCLOSURE AND PLACE FOR OBTAINING THE REPORT | | | | :--- | :--- | | **Media and websites for the Company's A Share disclosure** | Shanghai Securities News (www.cnstock.com)
Securities Times (www.stcn.com)
Securities Daily (www.zqrb.cn) | | **CSRC's designated website for the Company's annual report disclosure** | www.sse.com.cn | | **The Company's H Share disclosure websites** | HKEXnews website of Hong Kong Exchanges and Clearing Limited at www.hkexnews.hk
The Company's website at www.e-chinalife.com | | **The Company's annual report may be obtained at** | 16 Financial Street, Xicheng District, Beijing, P.R. China | # STOCK INFORMATION | Stock type | Exchanges on which the stocks are listed | Stock short name | Stock code | | :--- | :--- | :--- | :--- | | **A Share** | Shanghai Stock Exchange | China Life | 601628 | | **H Share** | The Stock Exchange of Hong Kong Limited | China Life | 2628 | # OTHER RELEVANT INFORMATION - **H Share registrar and transfer office:** Computershare Hong Kong Investors Services Limited; Address: Shops 1712-1716, 17th Floor, Hopewell Centre, 183 Queen's Road East, Wanchai, Hong Kong - **Domestic legal adviser:** King & Wood Mallesons - **International legal adviser:** Latham & Watkins LLP ## Auditors of the Company | | Domestic auditor | Overseas auditor | | :--- | :--- | :--- | | | Ernst & Young Hua Ming LLP | Ernst & Young | | **Address** | Rooms 01-12, Level 17, Ernst & Young Tower, Oriental Plaza, No.1 East Changan Avenue, Dongcheng District, Beijing, P.R. China | 27/F, One Taikoo Place, 979 King's Road, Quarry Bay, Hong Kong | | **Name of the Signing/Certified Auditors** | Gu Hong, Xia Xinran | Hoffman Cheong (Certified Auditor) | --- # DEFINITIONS AND MATERIAL RISK ALERT In this report, unless the context otherwise requires, the following expressions have the following meanings: | Expression | Meaning | | :--- | :--- | | **China Life, the Company⁷** | China Life Insurance Company Limited and its subsidiaries ⁷ Except for “the Company” referred to in the Consolidated Financial Statements. | | **CLIC** | China Life Insurance (Group) Company, the controlling shareholder of the Company | | **AMC** | China Life Asset Management Company Limited, a non-wholly owned subsidiary of the Company | | **Pension Company** | China Life Pension Company Limited, a non-wholly owned subsidiary of the Company | | **China Life AMP** | China Life AMP Asset Management Company Limited, an indirect non-wholly owned subsidiary of the Company | | **CGB** | China Guangfa Bank Co., Ltd., an associate of the Company | | **CLP&C** | China Life Property and Casualty Insurance Company Limited, a non-wholly owned subsidiary of CLIC | | **CLI** | China Life Investment Management Company Limited, a wholly-owned subsidiary of CLIC | | **China Life Capital** | China Life Capital Investment Company Limited, an indirect wholly-owned subsidiary of CLIC | | **Ministry of Finance** | Ministry of Finance of the People’s Republic of China | | **NFRA** | National Financial Regulatory Administration | | **CSRC** | China Securities Regulatory Commission | | **HKSE** | The Stock Exchange of Hong Kong Limited | | **SSE** | Shanghai Stock Exchange | | **Company Law** | Company Law of the People’s Republic of China | | **Insurance Law** | Insurance Law of the People’s Republic of China | | **Securities Law** | Securities Law of the People’s Republic of China | | **Articles of Association** | Articles of Association of China Life Insurance Company Limited | | **C-ROSS (Phase II) Regulation** | Solvency Regulatory Rules II for Insurance Companies | | **SARMRA** | Solvency Aligned Risk Management Requirements and Assessment | | **China or PRC** | For the purpose of this report, “China” or “PRC” refers to the People’s Republic of China, excluding the Hong Kong Special Administrative Region of the People’s Republic of China, the Macau Special Administrative Region of the People’s Republic of China and Taiwan region of the People’s Republic of China | | **ESG** | Environmental, Social and Governance | | **RMB** | Renminbi Yuan | ## Material Risk Alert: The risks faced by the Company primarily include risks relating to macro trends, insurance risk, market risk, credit risk, operational risk, strategic risk, reputational risk, liquidity risk, information safety risk, ESG risk and insurance fraud risk, etc. The Company has adopted various measures to manage and control different risks effectively. For details, please refer to the “Future Prospect” in the section headed “Management Discussion and Analysis” and the “Internal Control and Risk Management” in the section headed “Corporate Governance” of this report. --- # FINANCIAL REPORT # Independent Auditor's Report **Ernst & Young** 27/F, One Taikoo Place 979 King’s Road Quarry Bay, Hong Kong **安永會計師事務所** 香港鰂魚涌英皇道979號 太古坊一座27樓 **Tel電話:** +852 2846 9888 **Fax傳真:** +852 2868 4432 **ey.com** **To the shareholders of China Life Insurance Company Limited** (Incorporated in the People’s Republic of China with limited liability) ## OPINION We have audited the consolidated financial statements of China Life Insurance Company Limited (the “Company”) and its subsidiaries (the “Group”) set out on pages 102 to 220, which comprise the consolidated statement of financial position as at 31 December 2025, and the consolidated statement of comprehensive income, the consolidated statement of changes in equity and the consolidated statement of cash flows for the year then ended, and notes to the consolidated financial statements, including material accounting policy information. In our opinion, the consolidated financial statements give a true and fair view of the consolidated financial position of the Group as at 31 December 2025, and of its consolidated financial performance and its consolidated cash flows for the year then ended in accordance with IFRS Accounting Standards as issued by the International Accounting Standards Board and have been properly prepared in compliance with the disclosure requirements of the Hong Kong Companies Ordinance. --- # Independent Auditor’s Report (continued) ## BASIS FOR OPINION We conducted our audit in accordance with International Standards on Auditing (“ISAs”) as issued by the International Auditing and Assurance Standards Board. Our responsibilities under those standards are further described in the *Auditor’s responsibilities for the audit of the consolidated financial statements* section of our report. We are independent of the Group in accordance with the HKICPA’s *Code of Ethics for Professional Accountants* (the “Code”), as applicable to audits of financial statements of public interest entities. We have also fulfilled our other ethical responsibilities in accordance with the Code. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion. ## KEY AUDIT MATTERS Key audit matters are those matters that, in our professional judgement, were of most significance in our audit of the consolidated financial statements of the current period. These matters were addressed in the context of our audit of the consolidated financial statements as a whole, and in forming our opinion thereon, and we do not provide a separate opinion on these matters. For each matter below, our description of how our audit addressed the matter is provided in that context. We have fulfilled the responsibilities described in the *Auditor’s responsibilities for the audit of the consolidated financial statements* section of our report, including in relation to these matters. Accordingly, our audit included the performance of procedures designed to respond to our assessment of the risks of material misstatement of the consolidated financial statements. The results of our audit procedures, including the procedures performed to address the matters below, provide the basis for our audit opinion on the accompanying consolidated financial statements. ### Key audit matter: Valuation of insurance contract liabilities As at 31 December 2025, the Group’s insurance contract liabilities amounted to **RMB6,376,114 million**, representing **91.31%** of total liabilities. Since the measurement of insurance contract liabilities involves significant accounting estimates and judgments by management, which may have a substantial impact on the insurance contract liabilities, we have identified it as a key audit matter: The valuation of insurance contract liabilities involves significant judgement and estimates over the eligibility for the measurement approach, the determination of coverage unit and the uncertain future cash flows. Complex actuarial models and actuarial assumptions with highly judgemental nature are used to support the valuation of insurance contract liabilities. Key assumptions include mortality, morbidity, lapse rates, discount rates, expenses, policy dividends and risk adjustment for non-financial risk, etc. Refer to Notes 2.8, 4.1, 5.1 and 14 to the consolidated financial statements. ### How our audit addressed the key audit matter With the support of our internal experts, we performed the following audit procedures: - Evaluated the appropriateness of the accounting policies related to the measurement of insurance contract liabilities; - Evaluated and tested the design and operating effectiveness of key controls over the valuation of insurance contract liabilities; - Evaluated and tested the design and operating effectiveness of the related IT systems and controls over the valuation of insurance contract liabilities; - Evaluated the reasonableness of key judgements and assumptions, including comparing the key judgements and assumptions with the company’s historical data and applicable industry experiences; - Evaluated the appropriateness of the valuation approaches of insurance contract liabilities. Performed independent recalculation on insurance contract liabilities of selected typical insurance products or groups of insurance contracts; - Tested the completeness and accuracy of the underlying data used in the valuation of insurance contract liabilities; - Evaluated the overall reasonableness of the insurance contract liabilities by performing analytical review and assessing the impact of changes in assumptions. --- # Independent Auditor's Report (continued) ## KEY AUDIT MATTERS (continued) ### Key audit matter **Fair value of Level 3 financial assets** At 31 December 2025, the financial assets which was measured at fair value and categorized as Level 3 amounted RMB601,161 million, accounting for 7.92% of the Group’s total assets. **We identified valuation of Level 3 financial assets as a key audit matter**, as it involved significant management estimates and judgements in the assessment of valuation methodologies and significant unobservable inputs, and could be significantly impacted by use of different valuation methodologies and changes in significant unobservable inputs. Refer to Notes 2.4, 2.5, 4.2 and 5.4 to the consolidated financial statements. ### How our audit addressed the key audit matter With the support of our internal experts, we performed the following audit procedures: - Evaluated and tested the design and operating effectiveness of key controls over the valuation of Level 3 financial assets; - Evaluated the appropriateness of the valuation methodologies adopted by the Group, including comparing them to industry practice and acceptable valuation methods; - Evaluated the reasonableness of the key parameters used in the fair value measurement of Level 3 financial assets, including comparing significant unobservable inputs with third-party or market data; - Performed independent valuation for Level 3 financial assets on a sample basis and compared our results to the management record. ## OTHER INFORMATION INCLUDED IN THE ANNUAL REPORT The directors of the Company are responsible for the other information. The other information comprises the information included in the Annual Report other than the consolidated financial statements and our auditor’s report thereon. Our opinion on the consolidated financial statements does not cover the other information and we do not express any form of assurance conclusion thereon. In connection with our audit of the consolidated financial statements, our responsibility is to read the other information and, in doing so, consider whether the other information is materially inconsistent with the consolidated financial statements or our knowledge obtained in the audit or otherwise appears to be materially misstated. If, based on the work we have performed, we conclude that there is a material misstatement of this other information, we are required to report that fact. We have nothing to report in this regard. ## RESPONSIBILITIES OF THE DIRECTORS FOR THE CONSOLIDATED FINANCIAL STATEMENTS The directors of the Company are responsible for the preparation of the consolidated financial statements that give a true and fair view in accordance with IFRS Accounting Standards as issued by IASB and the disclosure requirements of the Hong Kong Companies Ordinance, and for such internal control as the directors determine is necessary to enable the preparation of consolidated financial statements that are free from material misstatement, whether due to fraud or error. In preparing the consolidated financial statements, the directors of the Company are responsible for assessing the Group’s ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless the directors either intend to liquidate the Group or to cease operations, or have no realistic alternative but to do so. The directors of the Company are assisted by the Audit Committee in discharging their responsibilities for overseeing the Group’s financial reporting process. --- # Independent Auditor’s Report (continued) ## AUDITOR’S RESPONSIBILITIES FOR THE AUDIT OF THE CONSOLIDATED FINANCIAL STATEMENTS Our objectives are to obtain reasonable assurance about whether the consolidated financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditor’s report that includes our opinion. Our report is made solely to you, as a body, and for no other purpose. We do not assume responsibility towards or accept liability to any other person for the contents of this report. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with ISAs will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these consolidated financial statements. As part of an audit in accordance with ISAs, we exercise professional judgement and maintain professional scepticism throughout the audit. We also: - **Identify and assess the risks of material misstatement** of the consolidated financial statements, whether due to fraud or error, design and perform audit procedures responsive to those risks, and obtain audit evidence that is sufficient and appropriate to provide a basis for our opinion. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control. - **Obtain an understanding of internal control** relevant to the audit in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Group’s internal control. - **Evaluate the appropriateness of accounting policies** used and the reasonableness of accounting estimates and related disclosures made by the directors. - **Conclude on the appropriateness of the directors’ use of the going concern basis** of accounting and, based on the audit evidence obtained, whether a material uncertainty exists related to events or conditions that may cast significant doubt on the Group’s ability to continue as a going concern. If we conclude that a material uncertainty exists, we are required to draw attention in our auditor’s report to the related disclosures in the consolidated financial statements or, if such disclosures are inadequate, to modify our opinion. Our conclusions are based on the audit evidence obtained up to the date of our auditor’s report. However, future events or conditions may cause the Group to cease to continue as a going concern. - **Evaluate the overall presentation, structure and content** of the consolidated financial statements, including the disclosures, and whether the consolidated financial statements represent the underlying transactions and events in a manner that achieves fair presentation. - **Plan and perform the group audit** to obtain sufficient appropriate audit evidence regarding the financial information of the entities or business units within the Group as a basis for forming an opinion on the consolidated financial statements. We are responsible for the direction, supervision and review of the audit work performed for purposes of the group audit. We remain solely responsible for our audit opinion. --- # Independent Auditor's Report (continued) ## AUDITOR’S RESPONSIBILITIES FOR THE AUDIT OF THE CONSOLIDATED FINANCIAL STATEMENTS (continued) We communicate with the Audit Committee regarding, among other matters, the planned scope and timing of the audit and significant audit findings, including any significant deficiencies in internal control that we identify during our audit. We also provide the Audit Committee with a statement that we have complied with relevant ethical requirements regarding independence, and to communicate with them all relationships and other matters that may reasonably be thought to bear on our independence, and where applicable, actions taken to eliminate threats or safeguards applied. From the matters communicated with the Audit Committee, we determine those matters that were of most significance in the audit of the consolidated financial statements of the current period and are therefore the key audit matters. We describe these matters in our auditor’s report unless law or regulation precludes public disclosure about the matter or when, in extremely rare circumstances, we determine that a matter should not be communicated in our report because the adverse consequences of doing so would reasonably be expected to outweigh the public interest benefits of such communication. The engagement partner on the audit resulting in this independent auditor’s report is Cheong Ming Yik (practising certificate number: P04626). **Ernst & Young** Certified Public Accountants Hong Kong 25 March 2026 --- # Consolidated Statement of Financial Position ## As at 31 December 2025 | ASSETS | Notes | As at 31 December 2025 (RMB million) | As at 31 December 2024 (RMB million) | | :--- | :---: | :---: | :---: | | Property, plant and equipment | 7 | 53,006 | 54,030 | | Right-of-use assets | 8 | 1,778 | 1,557 | | Investment properties | 9 | 11,702 | 12,319 | | Investments in associates and joint ventures | 10 | 307,788 | 302,077 | | Term deposits | 11.1 | 418,688 | 438,455 | | Statutory deposits – restricted | 11.2 | 6,620 | 6,591 | | Investment in debt instruments at amortised cost | 11.3 | 173,992 | 196,754 | | Investment in debt instruments at fair value through other comprehensive income | 11.4 | 3,926,042 | 3,458,895 | | Investment in equity instruments at fair value through other comprehensive income | 11.5 | 317,876 | 171,817 | | Financial assets at fair value through profit or loss | 11.6 | 2,067,288 | 1,908,098 | | Reinsurance contract assets | 14.3 | 30,014 | 30,738 | | Other assets | 13 | 47,941 | 31,712 | | Deferred tax assets | 27 | 34,431 | 40,026 | | Financial assets purchased under agreements to resell | 11.7 | 50,879 | 30,560 | | Accrued investment income | | 586 | 412 | | Cash and cash equivalents | | 142,373 | 85,505 | | **Total assets** | | **7,591,004** | **6,769,546** | The notes on pages 109 to 220 form an integral part of these consolidated financial statements. --- # Consolidated Statement of Financial Position (continued) As at 31 December 2025 | | Notes | As at 31 December 2025 | As at 31 December 2024 | | :--- | :---: | :---: | :---: | | | | **RMB million** | **RMB million** | | **LIABILITIES AND EQUITY** | | | | | **Liabilities** | | | | | Insurance contract liabilities | 14.2 | 6,376,114 | 5,825,026 | | Reinsurance contract liabilities | 14.3 | 312 | 160 | | Interest-bearing loans and other borrowings | 15 | 56 | 12,758 | | Bonds payable | 16 | 35,195 | 35,194 | | Other liabilities | 17 | 107,056 | 140,931 | | Deferred tax liabilities | | 1,480 | 147 | | Current tax liabilities | | 298 | 237 | | Premiums received in advance | | 48,227 | 28,760 | | Financial assets sold under agreements to repurchase | 18 | 331,863 | 151,564 | | Financial liabilities at fair value through profit or loss | | 82,010 | 53,521 | | **Total liabilities** | | **6,982,611** | **6,248,298** | | **Equity** | | | | | Share capital | 32 | 28,265 | 28,265 | | Reserves | 33 | 81,337 | 119,033 | | Retained earnings | | 485,603 | 362,377 | | **Attributable to equity holders of the Company** | | **595,205** | **509,675** | | Non-controlling interests | | 13,188 | 11,573 | | **Total equity** | | **608,393** | **521,248** | | **Total liabilities and equity** | | **7,591,004** | **6,769,546** | Approved and authorised for issue by the Board of Directors on 25 March 2026. **Cai Xiliang** Director **Li Mingguang** Director The notes on pages 109 to 220 form an integral part of these consolidated financial statements. --- # Consolidated Statement of Comprehensive Income For the year ended 31 December 2025 | | Notes | 2025 RMB million | 2024 RMB million | | :--- | :---: | :---: | :---: | | Insurance revenue | 20 | 214,136 | 208,161 | | Interest income | 21 | 128,286 | 120,958 | | Investment income | 22 | 255,411 | 176,461 | | Investment income from associates and joint ventures | 10 | 6,353 | 12,077 | | Other income | | 11,879 | 10,970 | | **Total revenues** | | **616,065** | **528,627** | | Insurance service expenses | 23 | (148,736) | (180,544) | | Allocation of reinsurance premiums paid | | (5,750) | (5,071) | | Less: Amounts recovered from reinsurers | | 5,248 | 5,449 | | Insurance finance income/(expenses) from insurance contracts issued | 24 | (258,858) | (209,952) | | Less: Reinsurance finance income/(expenses) from reinsurance contracts held | | 655 | 671 | | Finance costs | | (4,158) | (4,200) | | Expected credit losses | 25 | (151) | 207 | | Other impairment losses | | (3,275) | (1,611) | | Other expenses | | (19,411) | (18,363) | | **Profit before income tax** | 26 | **181,629** | **115,213** | | Income tax | 27 | (25,077) | (6,273) | | **Net profit** | | **156,552** | **108,940** | | **Attributable to:** | | | | | — Equity holders of the Company | | 154,078 | 106,935 | | — Non-controlling interests | | 2,474 | 2,005 | | **Basic and diluted earnings per share** | 28 | **RMB5.45** | **RMB3.78** | The notes on pages 109 to 220 form an integral part of these consolidated financial statements. --- # Consolidated Statement of Comprehensive Income (continued) For the year ended 31 December 2025 | Description | 2025 (RMB million) | 2024 (RMB million) | | :--- | :---: | :---: | | **Other comprehensive income** | **(49,553)** | **(56,687)** | | **Other comprehensive income attributable to equity holders of the Company (net of tax)** | **(49,472)** | **(56,770)** | | **Other comprehensive income that may be reclassified to profit or loss in subsequent periods:** | | | | Changes in fair value of investment in debt instruments at fair value through other comprehensive income | (118,174) | 219,720 | | Allowance for credit losses on investment in debt instruments at fair value through other comprehensive income | 68 | (378) | | Share of other comprehensive income of associates and joint ventures under the equity method | (2,488) | 3,287 | | Exchange differences on translating foreign operations | 383 | (66) | | Financial changes in insurance contracts | 70,517 | (288,811) | | Financial changes in reinsurance contracts | (443) | 2,667 | | **Other comprehensive income that may not be reclassified to profit or loss in subsequent periods:** | | | | Changes in fair value of investment in equity instruments at fair value through other comprehensive income | (321) | 6,266 | | Share of other comprehensive income of associates and joint ventures under the equity method | 909 | 554 | | Financial changes in insurance contracts | 77 | (9) | | **Non-controlling interests** | **(81)** | **83** | | **Total comprehensive income for the year, net of tax** | **106,999** | **52,253** | | **Attributable to:** | | | | – Equity holders of the Company | 104,606 | 50,165 | | – Non-controlling interests | 2,393 | 2,088 | The notes on pages 109 to 220 form an integral part of these consolidated financial statements. --- # Consolidated Statement of Changes in Equity For the year ended 31 December 2025 | | Attributable to equity holders of the Company: Share capital (Note 32) | Attributable to equity holders of the Company: Reserves (Note 33) | Attributable to equity holders of the Company: Retained earnings | Non-controlling interests | Total | | :--- | :---: | :---: | :---: | :---: | :---: | | **RMB million** | | | | | | | **As at 1 January 2024** | 28,265 | 165,695 | 283,133 | 9,941 | 487,034 | | Net profit | – | – | 106,935 | 2,005 | 108,940 | | Other comprehensive income | – | (56,770) | – | 83 | (56,687) | | **Total comprehensive income** | – | (56,770) | 106,935 | 2,088 | 52,253 | | **Transactions with shareholders** | | | | | | | Appropriation to reserves (Note 33) | – | 11,889 | (11,889) | – | – | | Dividends declared | – | – | (17,807) | – | (17,807) | | Dividends to non-controlling interests | – | – | – | (463) | (463) | | Reserves to retained earnings (Note 33) | – | (2,005) | 2,005 | – | – | | Others | – | 224 | – | 7 | 231 | | **Total transactions with shareholders** | – | 10,108 | (27,691) | (456) | (18,039) | | **As at 31 December 2024** | 28,265 | 119,033 | 362,377 | 11,573 | 521,248 | | **As at 1 January 2025** | 28,265 | 119,033 | 362,377 | 11,573 | 521,248 | | Net profit | – | – | 154,078 | 2,474 | 156,552 | | Other comprehensive income | – | (49,472) | – | (81) | (49,553) | | **Total comprehensive income** | – | (49,472) | 154,078 | 2,393 | 106,999 | | **Transactions with shareholders** | | | | | | | Appropriation to reserves (Note 33) | – | 15,300 | (15,300) | – | – | | Dividends declared (Note 30) | – | – | (19,446) | – | (19,446) | | Dividends to non-controlling interests | – | – | – | (684) | (684) | | Reserves to retained earnings (Note 33) | – | (3,894) | 3,894 | – | – | | Others | – | 370 | – | (94) | 276 | | **Total transactions with shareholders** | – | 11,776 | (30,852) | (778) | (19,854) | | **As at 31 December 2025** | 28,265 | 81,337 | 485,603 | 13,188 | 608,393 | The notes on pages 109 to 220 form an integral part of these consolidated financial statements. --- # Consolidated Statement of Cash Flows For the year ended 31 December 2025 | Item | 2025 (RMB million) | 2024 (RMB million) | | :--- | :--- | :--- | | **CASH FLOWS FROM OPERATING ACTIVITIES** | | | | Profit before income tax | 181,629 | 115,213 | | Adjustments for: | | | | - Investment income | (255,411) | (176,461) | | - Interest income | (128,286) | (120,958) | | - Expected credit losses | 151 | (207) | | - Other impairment losses | 3,275 | 1,611 | | - Insurance contracts and reinsurance contracts held | 644,623 | 580,024 | | - Depreciation and amortisation | 4,892 | 5,029 | | - Foreign exchange gains/(losses) | 340 | 25 | | - Investment income from associates and joint ventures | (6,353) | (12,077) | | - Receivables and payables | 17,136 | (11,751) | | - Income tax paid | (2,071) | (1,653) | | **Net cash inflow/(outflow) from operating activities** | **459,925** | **378,795** | | | | | | **CASH FLOWS FROM INVESTING ACTIVITIES** | | | | Disposals and maturities | 2,544,416 | 2,029,653 | | Purchases | (3,214,071) | (2,503,459) | | Investments in associates and joint ventures | (26,375) | (37,955) | | Decrease/(increase) in term deposits, net | (25,398) | (24,551) | | Decrease/(increase) in financial assets purchased under agreements to resell, net | (22,068) | (8,417) | | Interest received | 157,688 | 151,721 | | Dividends received | 38,440 | 38,388 | | **Net cash inflow/(outflow) from investing activities** | **(547,368)** | **(354,620)** | The notes on pages 109 to 220 form an integral part of these consolidated financial statements. --- # Consolidated Statement of Cash Flows (continued) For the year ended 31 December 2025 ## CASH FLOWS FROM FINANCING ACTIVITIES | | 2025 | 2024 | | :--- | :---: | :---: | | | **RMB million** | **RMB million** | | Increase/(decrease) in financial assets sold under agreements to repurchase, net | 180,633 | (65,875) | | Cash received from borrowings | 56 | 65 | | Interest paid | (6,480) | (8,650) | | Repayment of borrowings and bonds | (12,868) | (35,138) | | Dividends paid to equity holders of the Company | (19,446) | (17,807) | | Dividends paid to non-controlling interests | (676) | (458) | | Proceeds from issue of bonds | – | 35,000 | | Payment of lease liabilities | (988) | (1,074) | | Capital injected into subsidiaries by non-controlling interests, net | 4,110 | 7,178 | | **Net cash inflow/(outflow) from financing activities** | **144,341** | **(86,759)** | | **Foreign exchange gains/(losses) on cash and cash equivalents** | **(30)** | **28** | | **Net increase/(decrease) in cash and cash equivalents** | **56,868** | **(62,556)** | | **Cash and cash equivalents** | | | | Beginning of the period | 85,505 | 148,061 | | **End of the period** | **142,373** | **85,505** | | **Analysis of balances of cash and cash equivalents** | | | | Cash at banks and in hand | 142,346 | 85,118 | | Short-term bank deposits | 27 | 387 | The notes on pages 109 to 220 form an integral part of these consolidated financial statements. --- # Notes to the Consolidated Financial Statements For the year ended 31 December 2025 # 1 ORGANISATION AND PRINCIPAL ACTIVITIES China Life Insurance Company Limited (the "Company") was established in the People's Republic of China ("China" or the "PRC") on 30 June 2003 as a joint stock company with limited liability as part of a group restructuring of China Life Insurance (Group) Company ("CLIC", formerly China Life Insurance Company) and its subsidiaries. The Company and its subsidiaries are hereinafter collectively referred to as the "Group". The Group's principal activities are the underwriting of life, health, accident and other types of personal insurance business; reinsurance for personal insurance business; fund management business permitted by national laws and regulations or approved by the State Council of the People's Republic of China, etc. The Company is a joint stock company incorporated in the PRC with limited liability. The address of its registered office is 16 Financial Street, Xicheng District, Beijing, the PRC. The Company is listed on the Stock Exchange of Hong Kong Limited, and the Shanghai Stock Exchange. These consolidated financial statements are presented in millions of Renminbi ("RMB million") unless otherwise stated. These consolidated financial statements have been approved and authorised for issue by the Board of Directors on 25 March 2026. # 2 SUMMARY OF MATERIAL ACCOUNTING POLICIES The principal accounting policies applied in the preparation of these consolidated financial statements are set out below. ## 2.1 Basis of preparation The Group has prepared these consolidated financial statements in accordance with IFRS® Accounting Standards, amendments to IFRS Accounting Standards and interpretations issued by the International Accounting Standards Board ("IASB"). These consolidated financial statements also comply with the applicable disclosure provisions of the Rules Governing the Listing of Securities on The Stock Exchange of Hong Kong Limited (the "Listing Rules") and the applicable disclosure requirements of the Hong Kong Companies Ordinance. The Group has prepared the consolidated financial statements under the historical cost convention, except for financial assets and liabilities measured at fair value, assets or liabilities held for insurance contracts and reinsurance contracts, certain property, plant and equipment at deemed cost as part of the restructuring process. The preparation of financial statements in compliance with IFRS Accounting Standards requires the use of certain material estimates. It also requires management to exercise its judgement in the process of applying the Group's accounting policies. The areas involving a higher degree of judgement or complexity, or areas where assumptions and estimates are significant to the consolidated financial statements are disclosed in Note 4. ### 2.1.1 New accounting standards and amendments adopted by the Group for the first time for the financial year beginning on 1 January 2025 | Standards/Amendments | Content | Effective for annual periods beginning on or after | | :--- | :--- | :--- | | Amendments to IAS 21 | Lack of Exchangeability | 1 January 2025 | The above amendments to the standards did not have any significant impact on the consolidated financial statements of the Group for the year ended 31 December 2025. --- # Notes to the Consolidated Financial Statements (continued) For the year ended 31 December 2025 ## 2 SUMMARY OF MATERIAL ACCOUNTING POLICIES (continued) ### 2.1 Basis of preparation (continued) #### 2.1.2 New accounting standards and amendments that are issued but not yet effective and have not been early adopted by the Group for the financial year beginning on 1 January 2025 | Standards/Amendments | Content | Effective for annual periods beginning on or after | | :--- | :--- | :--- | | IFRS 18 (i) | Presentation and Disclosure in Financial Statements | 1 January 2027 | | IFRS 19 and its amendments | Subsidiaries without Public Accountability: Disclosures | 1 January 2027 | | Amendments to IFRS 9 and IFRS 7 | Amendments to the Classification and Measurement of Financial Instruments | 1 January 2026 | | Amendments to IFRS 10 and IAS 28 | Sale or Contribution of Assets between an Investor and its Associate or Joint Venture | No mandatory effective date yet determined but available for adoption | | Amendments to IAS 21 | Translation to a Hyperinflationary Presentation Currency | 1 January 2027 | | Annual Improvements to IFRS Accounting Standards—Volume 11 | Amendments to IFRS 1, IFRS 7, IFRS 9, IFRS 10 and IAS7. | 1 January 2026 | **(i)** IFRS 18 replaces IAS 1 Presentation of Financial Statements. While a number of sections have been brought forward from IAS 1 with limited changes, IFRS 18 introduces new requirements for presentation within the statement of profit or loss, including specified totals and subtotals. Entities are required to classify all income and expenses within the statement of profit or loss into one of the five categories: operating, investing, financing, income taxes and discontinued operations and to present two new defined subtotals. IFRS 18 and the consequential amendments to other IFRS Accounting Standards are effective for annual periods beginning on or after 1 January 2027 with earlier application permitted. Retrospective application is required. The Group is assessing the impact of IFRS 18 on the presentation and disclosure of the Group’s consolidated financial statements. The Group has not early adopted any standard, interpretation or amendment that has been issued but is not yet effective. Besides the above (i), other standards, interpretations or amendments that are not yet effective are not expected to have a material impact on the consolidated financial statements of the Group. --- # Notes to the Consolidated Financial Statements (continued) For the year ended 31 December 2025 ## 2 SUMMARY OF MATERIAL ACCOUNTING POLICIES (continued) ### 2.2 Consolidation The consolidated financial statements include the financial statements of the Company and its subsidiaries for the year ended 31 December 2025. Subsidiaries are those entities which are controlled by the Group (including the structured entities controlled by the Group). Control is achieved when the Group is exposed, or has rights, to variable returns from its involvement with the investee and has the ability to affect those returns through its power over the investee. Specifically, the Group controls an investee if and only if the Group has: - power over the investee (i.e., existing rights that give it the current ability to direct the relevant activities of the investee); - exposure, or rights, to variable returns from its involvement with the investee; and - the ability to use its power over the investee to affect its returns. When the Group has less than a majority of the voting or similar rights of an investee, the Group considers all relevant facts and circumstances in assessing whether it has power over an investee, including: - the contractual arrangement with the other vote holders of the investee; - rights arising from other contractual arrangements; and - the Group’s voting rights and potential voting rights. The Group re-assesses whether or not it controls an investee if facts and circumstances indicate that there are changes to one or more of the three elements of control. Consolidation of a subsidiary begins when the Group obtains control over the subsidiary and ceases when the Group loses control of the subsidiary. Profit or loss and each component of other comprehensive income are attributed to the equity holders of the Company and to the non-controlling interests, even if this results in the non-controlling interests having a deficit balance. When necessary, adjustments are made to the financial statements of subsidiaries to bring their accounting policies in line with the Group’s accounting policies. All intra-group assets and liabilities, equity, income, expenses and cash flows relating to transactions between members of the Group are eliminated in full upon consolidation. A change in the ownership interest of a subsidiary, without a loss of control, is accounted for as an equity transaction. If the Group loses control over a subsidiary, it: - derecognises the assets (including goodwill) and liabilities of the subsidiary; - derecognises the carrying amount of any non-controlling interests; - derecognises the cumulative translation differences recorded in equity; - recognises the fair value of the consideration received; - recognises the fair value of any investment retained; - recognises any surplus or deficit in profit or loss; and - reclassifies the Group’s share of components previously recognised in other comprehensive income to profit or loss or retained earnings, as appropriate, as if the Group had directly disposed of the related assets or liabilities. --- # Notes to the Consolidated Financial Statements (continued) For the year ended 31 December 2025 ## 2 SUMMARY OF MATERIAL ACCOUNTING POLICIES (continued) ### 2.2 Consolidation (continued) The consolidated financial statements incorporate the financial statements of the combining entities or businesses in business combination under common control as if they had been combined from the date when the combining entities or businesses first came under the control of the ultimate holding company. The net assets of the combining entities or businesses are consolidated using the carrying amount from the ultimate holding company’s perspective. No amount is recognised for goodwill or excess of the Group’s interest in the book value of the net assets over cost at the time of the common control combination, to the extent of the continuation of the ultimate holding company’s interest. The consolidated statement of comprehensive income includes the results of each of the combining entities or businesses from the earliest date presented or since the date when the combining entities or businesses first came under common control, where this is a shorter period, regardless of the date of the common control combination. The comparative financial data have been restated to reflect the business combinations under common control occurred during this year. Transaction costs, including professional fees, registration fees, costs of furnishing information to shareholders, costs or losses incurred in combining operations of the previously separate businesses and other costs incurred in relation to the common control combination that is to be accounted for by using the merger accounting method are recognised as expenses in the period in which they are incurred. The acquisition method of accounting is used to account for the acquisition of subsidiaries by the Group, other than common control combinations. The consideration transferred for the acquisition of a subsidiary is the fair value of the assets transferred, the liabilities incurred and the equity interest issued by the Group. The consideration transferred includes the fair value of any asset or liability resulting from a contingent consideration arrangement. Acquisition-related costs are expensed as incurred. Identifiable assets acquired, and liabilities and contingent liabilities assumed in a business combination are measured initially at their fair value at the acquisition date. On an acquisition-by-acquisition basis, the Group recognises any non-controlling interest in the acquiree either at fair value or at the non-controlling interest’s proportionate share of the acquiree’s net assets. The excess of the aggregate of the consideration transferred, the fair value of any non-controlling interest in the acquiree, and the fair value of any previous equity interest in the acquiree at the acquisition date over the fair value of the net identifiable assets acquired and liabilities assumed is recorded as goodwill. If this is less than the fair value of the net assets of the subsidiary acquired in the case of a bargain purchase, the Group re-assesses whether it has correctly identified all of the assets acquired and all of the liabilities assumed, and reviews the procedures used to measure the amounts to be recognised at the acquisition date. If the re-assessment still results in an excess of the fair value of net assets acquired over the aggregate consideration transferred, then the gain is recognised in profit or loss. Goodwill is tested annually for impairment and carried at cost less accumulated impairment losses. If there is any indication that goodwill is impaired, recoverable amount is estimated and the difference between carrying amount and recoverable amount is recognised as an impairment charge. Impairment losses on goodwill are not reversed in subsequent periods. Gains or losses on the disposal of an entity take into consideration the carrying amount of goodwill relating to the entity sold. The investments in subsidiaries are accounted for only in the Company’s statement of financial position at cost less impairment. Cost is adjusted to reflect changes in consideration arising from contingent consideration amendments. Cost also includes direct attributable costs of investment. The results of subsidiaries are accounted for by the Company on the basis of dividends received and receivable. #### Transactions with non-controlling interests The Group treats transactions with non-controlling interests that do not result in loss of controls as equity transactions. For shares purchased from non-controlling interests, the difference between any consideration paid and the relevant share acquired of the carrying value of net assets of the subsidiary is recorded in equity. Gains or losses on disposal of shares to non-controlling interests are also recorded in equity. --- # Notes to the Consolidated Financial Statements (continued) For the year ended 31 December 2025 ## 2 SUMMARY OF MATERIAL ACCOUNTING POLICIES (continued) ### 2.2 Consolidation (continued) **Transactions with non-controlling interests (continued)** When the Group ceases to have control or significant influence, any retained interest in the entity is re-measured to its fair value, with the change in carrying amount recognised in profit or loss. The fair value is the initial carrying amount for the purposes of subsequently accounting for the retained interest as an associate, joint venture or financial asset. In addition, any amounts previously recognised in other comprehensive income in respect of that entity are accounted for as if the Group had directly disposed of the related assets or liabilities. This may mean that amounts previously recognised in other comprehensive income are reclassified to profit or loss. If the ownership interest in an associate is reduced but significant influence is retained, only a proportionate share of the amounts previously recognised in other comprehensive income is reclassified to profit or loss as appropriate. ### 2.3 Associates and joint ventures **Associates** are entities over which the Group has significant influence, generally accompanying a shareholding of between 20% and 50% of the voting rights of the investee. Significant influence is the power to participate in the financial and operating policy decisions of the investee, but is not control or joint control over those policies. **Joint ventures** are the type of joint arrangements whereby the parties that have joint control of the arrangement have rights to the net assets of the joint venture. Joint control is the contractually agreed sharing of control of an arrangement, which exists only when decisions about the relevant activities require the unanimous consent of the parties sharing control. Investments in associates and joint ventures are accounted for using the equity method of accounting and are initially recognised at cost. The Group’s share of post-acquisition profit or loss of its associates and joint ventures is recognised in net profit, and its share of post-acquisition movements in other comprehensive income is recognised in the consolidated statement of comprehensive income. The cumulative post-acquisition movements are adjusted against the carrying amount of the investment. When the Group’s share of losses in an associate or joint venture equals or exceeds its interest in the associate or joint venture, including any other unsecured receivables, the Group does not recognise further losses unless it has obligations to make payments on behalf of the associate or joint venture. Unrealised gains on transactions between the Group and its associates or joint ventures are eliminated to the extent of the Group’s interests in the associates or joint ventures. Unrealised losses are also eliminated unless the transaction provides evidence of an impairment of the asset transferred. Associates and joint ventures’ accounting policies have been changed where necessary to ensure consistency with the policies adopted by the Group. The Group adjusts the financial statements of its associates and joint ventures for insurance companies that have not adopted IFRS 9 and IFRS 17 in accordance with the Group’s accounting policies and recognises investment income and other comprehensive income, etc. accordingly. Goodwill represents the excess of the cost of an acquisition over the fair value of the Group’s share of the net identifiable assets of acquired associates or joint ventures at the date of acquisition. Goodwill on acquisitions of associates and joint ventures is included in investments in associates and joint ventures and is tested for impairment as part of the overall balance. Impairment losses on goodwill are not reversed. Gains or losses on the disposal of an entity take into consideration the carrying amount of goodwill relating to the entity sold. The Group determines at each reporting date whether there is any objective evidence that the investments in associates and joint ventures are impaired. If this is the case, an impairment loss is recognised for the amount by which the investment’s carrying amount exceeds its recoverable amount. The recoverable amount is the higher of the investment’s fair value less costs of disposal and value in use. The impairment of investments in the associates and joint ventures is reviewed for possible reversal at each reporting date. --- # Notes to the Consolidated Financial Statements (continued) For the year ended 31 December 2025 ## 2 SUMMARY OF MATERIAL ACCOUNTING POLICIES (continued) ### 2.4 Financial instruments A financial instrument is any contract that gives rise to a financial asset of one entity and a financial liability or equity instrument of another entity. A financial asset or a financial liability is recognised when the Group becomes a party to the contractual provisions of the instrument. Purchase and sale of investments are recognised on the trade date, when the Group commits to purchase or sell assets. At initial recognition, financial assets or financial liabilities not at fair value through profit or loss are measured at fair value plus or minus transaction costs (such as related charges and commissions) that are directly attributable to the acquisition or issue of such financial assets or financial liabilities. For financial assets and financial liabilities at fair value through profit or loss, transaction costs are recognised in profit or loss. #### 2.4.1 Financial assets **Classification and measurement** Based on the Group’s business model for managing the financial assets and the contractual cash flow characteristics of the financial assets, financial assets are classified as: financial assets at amortised cost, financial assets at fair value through other comprehensive income, and financial assets at fair value through profit or loss. When, and only when, the Group changes the business model for managing financial assets, the Group shall reclassify all affected financial assets. **Debt instruments** Debt instruments are those financial instruments that meet the definition of a financial liability from the issuer’s perspective. Classification and subsequent measurement of debt instruments depend on: (a) the Group’s business model for managing assets; and (b) cash flow characteristics of financial assets (whether the cash flows are solely payments of principal and interest on the principal amount outstanding). Based on these factors, the Group classifies its debt instruments into the following three measurement categories: **i. Financial assets at amortised cost** The financial asset is held within a business model whose objective is to collect the contractual cash flows, and the contractual cash flow characteristics are consistent with a basic lending arrangement, which gives rise on specified dates to the contractual cash flows that are solely payments of principal and interest on the principal amount outstanding, and the financial assets are not designated as at fair value through profit or loss, so they are measured at amortised cost. The interest income of such financial assets is recognised using the effective interest rate method. Impairment losses and foreign exchange gains or losses are recognised in profit or loss. The gains or losses arising from derecognition are recognised directly in profit or loss. The financial assets held by the Group mainly include cash and cash equivalents, investment in debt instruments at amortised cost, financial assets purchased under agreements to resell, term deposits, other receivables, etc. **ii. Investments in debt instruments at fair value through other comprehensive income** The financial asset is held within a business model whose objectives are both collecting the contractual cash flows and selling such financial assets, and the contractual cash flow characteristics are consistent with a basic lending arrangement. In addition, the financial assets are not designated as at fair value through profit or loss. Such financial assets are measured at fair value through other comprehensive income, and interest income is recognised using the effective interest rate method. Impairment losses and foreign exchange gains or losses are recognised in profit or loss for the current period. When such financial assets are derecognised, the cumulative changes in fair value recognised in other comprehensive income are carried forward to profit or loss for the current period. --- # Notes to the Consolidated Financial Statements (continued) For the year ended 31 December 2025 ## 2 SUMMARY OF MATERIAL ACCOUNTING POLICIES (continued) ### 2.4 Financial instruments (continued) #### 2.4.1 Financial assets (continued) ##### Classification and measurement (continued) ###### Debt instruments (continued) **iii. Financial assets at fair value through profit or loss** Debt instruments held by the Group that are not measured at amortised cost or fair value through other comprehensive income are classified as financial assets at fair value through profit or loss. These financial assets are subsequently measured at fair value. Net gains or losses, including any interest or dividend income, are recognised in profit or loss within investment income. The interest income of debt instruments under this type of financial asset is calculated based on the coupon rate. ###### Equity instruments Equity instruments are financial instruments that meet the definition of equity instruments when analysed from the issuer’s perspective. All equity instruments held by the Group are subsequently measured at fair value, and gains or losses are recognised in profit or loss. However, on initial recognition of an equity investment that is not held for trading, the Group may irrevocably elect to present subsequent changes in the instrument’s fair value in other comprehensive income, and no provision for impairment is required. Dividend income is recognised in profit or loss for the period (except for those clearly represent a recovery of part of the cost of the investments). Other net gains and losses (including exchange gains and losses) are recognised in other comprehensive income, and may not be subsequently transferred to profit or loss. Changes in the fair value of equity instruments measured at fair value through profit and loss, including any dividend income and foreign exchange gains and losses, are recognised in profit or loss within investment income. Dividend incomes on these equity instruments, which are generally determined at the amounts to be distributed by the investees, are recognised when the Group’s right to receive the payment is established. Equity instruments classified as financial assets at fair value through profit or loss. After the initial confirmation, gains or losses arising from changes in the fair value of such financial assets (including dividend income earned and exchange gains or losses) are recognised in profit or loss for the period and shown in investment income. Dividend income from equity instruments is generally determined by the amount distributed by the investee and is recognised when the Group’s right to receive dividends is established. ##### Impairment Expected credit losses (“ECL”) refer to the weighted average of credit losses with the respective risks of a default occurring as the weights. Credit loss refers to the difference between all contractual cash flows discounted at the original effective interest rate or credit-adjusted effective interest rate for credit-impaired financial assets and receivable under the contract and all cash flows expected to be received, which is the present value of all cash shortfalls. The Group recognises credit losses the basis of the ECL for cash and cash equivalents, term deposits, statutory deposits, financial assets purchased under agreements to resell, investment in debt instrument at amortised cost, investment in debt instrument at fair value through other comprehensive income, as well as other receivables etc. Giving consideration to reasonable and supportable information on past events, current conditions and forecasts of future economic conditions weighted by the probability of default, the Group recognises the ECL as the probability-weighted amount of the present value of the difference between the cash flows receivable from the contract and the cash flows expected to be collected. At each reporting date, the ECL of financial instruments at different stages is measured respectively. 12-month ECL is recognised for financial instruments in Stage 1 which do not have a significant increase in credit risk since initial recognition; lifetime ECL is recognised for financial instruments in Stage 2 which have had a significant increase in credit risk since initial recognition but are not deemed to be credit-impaired; and lifetime ECL is recognised for financial instruments in Stage 3 that has been credit-impaired. --- # Notes to the Consolidated Financial Statements (continued) For the year ended 31 December 2025 ## 2 SUMMARY OF MATERIAL ACCOUNTING POLICIES (continued) ### 2.4 Financial instruments (continued) #### 2.4.1 Financial assets (continued) **Impairment (continued)** For the financial instruments in Stage 1 and Stage 2, the Group calculates the interest income by applying the effective interest rate to the gross carrying amount (before net of expected credit losses). For the financial instruments in Stage 3, the interest income is calculated by applying the effective interest rate to the amortised cost (net of expected credit losses). The Group recognises the impairment gain or loss into profit or loss for the period. For debt instruments classified as fair value through other comprehensive income, the Group recognises the loss allowance in profit or loss, meanwhile adjusts other comprehensive income, which does not decrease the carrying amount of the financial assets. **Derecognition** A financial asset is derecognised when one of the following criteria is met: (i) the contractual rights to receive the cash flows from the financial asset has expired; (ii) the financial asset has been transferred and the Group transfers substantially all the risks and rewards of ownership of the financial asset to the transferee; or (iii) the financial asset has been transferred and the Group has not retained control of the financial asset, although the Group neither transfers nor retains substantially all the risks and rewards of ownership of the financial asset. When an investment in equity instruments measured at fair value through other comprehensive income is derecognised, the cumulative gain or loss previously recognised in other comprehensive income should be transferred out and recognised in retained earnings. For other financial assets, when they are derecognised, their cumulative gains or losses previously recognised in other comprehensive income should be transferred out and recognised in profit or loss. #### 2.4.2 Financial liabilities Financial liabilities are classified into financial liabilities at amortised cost and financial liabilities at fair value through profit or loss at initial recognition. Financial liabilities at amortised cost consist primarily of interest-bearing loans and other borrowings, financial assets sold under agreements to repurchase, bonds payable and liabilities arising from certain investment contracts without a discretionary participation feature (presented in other liabilities). Such financial liabilities are initially recognised at fair value, net of transaction costs incurred, and using the effective interest rate method for subsequent measurement. Financial liabilities at fair value through profit or loss mainly include liabilities arising from certain investment contracts without discretionary participation features (pension annuity products that do not transfer insurance risk), which are designated on initial recognition for subsequent measurement at fair value, with all realized or unrealized gains and losses recognised in profit or loss. The Group retains substantially all the risk and rewards of ownership of securities sold under agreements to repurchase which generally mature within 180 days from the transaction date. Therefore, securities sold under agreements to repurchase are classified as secured borrowings. The Group may be required to provide additional collateral based on the fair value of the underlying securities. Securities sold under agreements to repurchase are recorded at amortised cost, i.e., their cost plus accrued interest at the end of the reporting period. The underlying asset of securities sold under agreements to repurchase continue to be carried on the consolidated statement of financial position. Bonds payable are initially recognised at fair value and subsequently measured at amortised cost using the effective interest rate method. Amortised cost is calculated by taking into account any discount or premium at acquisition and transaction costs. A financial liability is derecognised or partly derecognised when the underlying present obligation is discharged or partly discharged. The difference between the carrying amount of the derecognised part of the financial liability and the consideration paid is recognised in profit or loss for the current period. --- # Notes to the Consolidated Financial Statements (continued) For the year ended 31 December 2025 ## 2 SUMMARY OF MATERIAL ACCOUNTING POLICIES (continued) ### 2.5 Fair value measurement Fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. The fair value measurement of assets and liabilities is based on the presumption that the transaction to sell the asset or transfer the liability takes place either: - in the principal market for the asset or liability; or - in the absence of a principal market, in the most advantageous market for the asset or liability. The principal or the most advantageous market is accessible by the Group at the measurement date. The fair value of an asset or a liability is measured using the assumptions that market participants would use when pricing the asset or liability, assuming that market participants act in their economic best interest. A fair value measurement of a non-financial asset takes into account a market participant’s ability to generate economic benefits by using the asset in its highest and best use or by selling it to another market participant that would use the asset in its highest and best use. The Group uses valuation techniques that are appropriate in the circumstances and for which sufficient data is available to measure fair value, maximising the use of relevant observable inputs and minimising the use of unobservable inputs. The assets and liabilities for which fair value is measured or disclosed in the consolidated financial statements are categorised within the fair value hierarchy, described in Notes 5.4, 9 and 11.3 based on the lowest level input that is significant to the fair value measurement as a whole. For assets and liabilities recognised in the financial statements and measured at fair value on a recurring basis, the Group determines whether transfers have occurred between each level in the hierarchy by re-assessing categorisation at the end of each reporting period. ### 2.6 Cash and cash equivalents Cash amounts represent cash on hand and demand deposits. Cash equivalents are short-term, highly liquid investments with original maturities of 90 days or less, whose carrying value approximates fair value. ### 2.7 Financial assets purchased under agreements to resell The Group purchases securities under agreements to resell substantially identical securities. These agreements are classified as secured loans and are recorded at amortised cost, i.e., their costs plus accrued interests at the end of the reporting period, which approximates fair value. The amounts advanced under these agreements are reflected as assets in the consolidated statement of financial position. The Group does not take physical possession of financial assets purchased under agreements to resell. Sale or transfer of the securities is not permitted by the respective clearing house on which they are registered while the lent capital is outstanding. In the event of default by the counterparty, the Group has the right to the underlying securities held by the clearing house. ### 2.8 Insurance Contracts #### 2.8.1 Definition The contracts issued by the Group are classified into insurance contracts and investment contracts. An insurance contract is a contract under which the issuer of the contract accepts significant insurance risk from the policyholder by agreeing to compensate the policyholder if a specified insured event adversely affects the policyholder. The Group assesses the extent to which insurance risk is transferred within a contract, conducting a test for the presence of significant insurance risk, thereby determining whether the contract should be classified as an insurance contract. Insurance contracts are those contracts that transfer significant insurance risk. --- # Notes to the Consolidated Financial Statements (continued) For the year ended 31 December 2025 ## 2 SUMMARY OF MATERIAL ACCOUNTING POLICIES (continued) ### 2.8 Insurance Contracts (continued) #### 2.8.1 Definition (continued) When the Group performs tests on significant insurance risk, it determines that a contract transfers significant insurance risk if the following conditions are met: (a) at least in one scenario that has commercial substance, an insured event specified by the contract could cause the Group to pay significant additional amounts, even if the insured event is extremely unlikely, or even if the expected present value of the contingent cash flows is a small proportion of the expected present value of the remaining cash flows from the insurance contract. Absence of discernible effect on the economics indicates lack of commercial substance. The additional amounts refer to the present value of amounts payable if an insured event occurs that exceed those that would be payable if no insured event had occurred (including claims handling and assessment costs); (b) at least in one scenario that has commercial substance, an insured event specified by the contract could cause the Group to incur a loss on a present value basis. However, even if a reinsurance contract does not expose the issuer to the possibility of a significant loss, that contract is deemed to transfer significant insurance risk if it transfers to the reinsurer substantially all the insurance risk relating to the reinsured portions of the underlying insurance contracts. Investment contracts issued by the Group have the legal form of insurance contracts but do not transfer significant insurance risks. The Group accounts for the investment contract with discretionary participation features applying the accounting treatments for insurance contracts. An investment contract with discretionary participation features is a financial instrument that provides a particular investor with the contractual right to receive guaranteed and additional amounts. The additional amounts are subject to the returns on a specified pool of items at the discretion of the issuer, and are expected to be a significant portion of the total contractual benefits. For liabilities arising from investment contracts without discretionary participation features, the Group accounts for these contracts according to note 2.4.2. An insurance contract is an insurance contract with direct participation features if all the following conditions are met at the inception of the contracts: (a) the contractual terms specify that the policyholder participates in a share of a clearly identified pool of underlying items; (b) an amount equal to a substantial share of the fair value returns on the underlying items is expected to be paid to the policyholder; and (c) a substantial proportion of any change in the amounts to be paid to the policyholder is expected to vary with the change in fair value of the underlying items. Reinsurance contract is an insurance contract issued by the reinsurer to compensate the cedent for claims arising from one or more insurance contracts issued by the cedent. The Group adopts different models for different types of insurance contracts. Insurance contracts with direct participation features are measured using the variable fee approach. The Group simplifies the measurement using the premium allocation approach for insurance contracts and reinsurance contracts with coverage of one year or less or contract groups where there is no significant difference between the results of measuring liabilities for remaining coverage using the premium allocation approach and the results of measuring such liabilities using general measurement model. Other types of insurance and reinsurance contracts are measured using the general measurement model. The Group assesses the classification of contracts using its expectations at inception of the contracts and does not reassess the conditions afterwards, unless the contracts are modified. --- # Notes to the Consolidated Financial Statements (continued) For the year ended 31 December 2025 ## 2 SUMMARY OF MATERIAL ACCOUNTING POLICIES (continued) ### 2.8 Insurance Contracts (continued) #### 2.8.2 Combination The Group treats a series of insurance contracts with the same counterparty or related counterparties which may achieve an overall commercial effect, as a whole in order to report the substance of such contracts. #### 2.8.3 Separation An insurance contract may contain one or more components, the Group separates the following components: - (a) embedded derivatives meeting the separation conditions of accounting policies for financial instruments under IFRS 9 – Financial Instruments; - (b) distinct investment components, but the investment components that meet the definition of investment contracts with discretionary participation features are still accounted for applying the accounting policies for insurance contracts; - (c) promises to transfer distinct goods or services other than insurance contract services. **Investment component** is the amount that an insurance contract requires to repay to policyholders regardless of whether an insured event occurs. After the Group identifies and separates the non-insurance components that meet the above conditions for separation, the Group applies the accounting policies related to insurance contracts to the remaining portion. #### 2.8.4 Classification The Group identifies portfolios of insurance contracts as contracts subject to similar risks and are managed together. A group of insurance contracts consists of one or more insurance contracts issued within a period of no longer than one year and with similar levels of profitability. The Group divides a portfolio of insurance contracts into a minimum of the following groups: - (a) a group of contracts that is onerous at initial recognition; - (b) a group of contracts that at initial recognition has no significant possibility of becoming onerous subsequently; - (c) a group of the remaining contracts in the portfolio. Portfolios of reinsurance contracts held are assessed for aggregation separately from portfolios of insurance contracts issued. The Group divides the same portfolio of reinsurance contracts held into at least the following groups of contracts: - (a) a group of contracts for which there is a net gain at initial recognition; - (b) a group of contracts for which, at initial recognition, there is no significant possibility of a net gain arising subsequently; - (c) a group of the remaining contracts in the portfolio. The Group classifies reinsurance contracts held within a period of no longer than one year into the same group of reinsurance contracts held. These groups represent the level of aggregation at which insurance contracts are initially recognised and measured. The Group does not reassess the composition of the groups subsequently. --- # Notes to the Consolidated Financial Statements (continued) For the year ended 31 December 2025 ## 2 SUMMARY OF MATERIAL ACCOUNTING POLICIES (continued) ### 2.8 Insurance Contracts (continued) #### 2.8.5 Recognition The Group recognises a group of insurance contracts it issues from the earliest of the following: 1. **(a)** the beginning of the coverage period of the group of contracts, the coverage period refers to the period during which the Group provides insurance contract services; 2. **(b)** the date when the first payment from a policyholder becomes due, or the date when the first payment is received by the Group if there is no contractual due date; 3. **(c)** when it becomes onerous. Reinsurance contracts held are recognised from the earliest of the following: 1. **(a)** the beginning of the coverage period of the group of reinsurance contracts held; and 2. **(b)** the date the Group recognises an onerous group of underlying insurance contracts. For the reinsurance contracts held that provide proportionate coverage, they are recognised from the earlier of the following: 1. **(a)** the later of the beginning of the coverage period or that any underlying insurance contract is initially recognised; 2. **(b)** the date the Group recognises an onerous group of underlying insurance contracts. #### 2.8.6 Measurement of insurance contracts **(i) General provisions (general measurement model)** **Initial measurement** On initial recognition, the Group shall measure a group of insurance contracts at the total of the fulfilment cash flows and the contractual service margin. Fulfilment cash flows comprise the following: 1. **(a)** estimates of future cash flows directly related to the insurance contract; 2. **(b)** an adjustment to reflect the time value of money and the financial risks; and 3. **(c)** a risk adjustment for non-financial risk. The fulfilment cash flows do not reflect the non-performance risk of the Group. The Group defines insurance acquisition cash flows as cash flows arising from the costs of selling, underwriting and starting a group of insurance contracts that are directly attributable to the portfolio of insurance contracts to which the group belongs. The Group may estimate the future cash flows at a higher level of aggregation and then allocate the resulting fulfilment cash flows to individual groups of contracts. --- # Notes to the Consolidated Financial Statements (continued) For the year ended 31 December 2025 ## 2 SUMMARY OF MATERIAL ACCOUNTING POLICIES (continued) ### 2.8 Insurance Contracts (continued) #### 2.8.6 Measurement of insurance contracts (continued) ##### (i) General provisions (general measurement model) (continued) **Initial measurement (continued)** The estimates of future cash flows: (a) estimates of future cash flows are unbiased probability-weighted averages; (b) reflect the perspective of the Group, provided that the estimates of any relevant market variables are consistent with observable market prices for those variables; (c) reflect conditions existing at the reporting date; and (d) are estimated separately from adjustment for the time value of money and financial risk, unless the most appropriate measurement technique combines these estimates. The Group includes in the measurement of a group of insurance contracts all the future cash flows within the boundary of each contract in the group and does not measure future cash flows outside the boundary of the contract group. Cash flows are within the boundary of an insurance contract if the Group has the right to require policyholders to pay premiums or has a substantive obligation to provide policyholders with insurance contract services. A substantive obligation to provide insurance contract services ends when: (a) the Group has the practical ability to reassess the risks of the particular policyholder and, as a result, can set a price or level of benefits that fully reflects those risks; or (b) the Group has the practical ability to reassess the risks of the portfolio of insurance contracts that contains the contract and, as a result, can set a price or level of benefits that fully reflects the risk of that portfolio; and the pricing of the premiums up to the date when the risks are reassessed does not take into account the risks that relate to periods after the reassessment date. The Group uses appropriate discount rate to adjust the estimates of future cash flows to reflect the time value of money and the financial risks related to those cash flows, to the extent that the financial risks are not included in the estimates of cash flows. The discount rates applied to scope out of the future cash flows shall: (a) reflect the time value of money, the characteristics of the cash flows and the liquidity characteristics of the insurance contracts; and (b) be consistent with observable current market prices for financial instruments with cash flows whose characteristics are consistent with those of the insurance contracts, excluding the effect of factors that influence such observable market prices but do not affect the future cash flows of the insurance contracts. The risk adjustment for non-financial risk is applied to the present value of the estimated future cash flows, to reflect the compensation that the Group requires for bearing the uncertainty about the amount and timing of the cash flows that arises from non-financial risk. The contractual service margin is a component of the liability for the group of insurance contracts that represents the unearned profit the Group will recognise as it provides insurance contract services in the future. --- # Notes to the Consolidated Financial Statements (continued) For the year ended 31 December 2025 ## 2 SUMMARY OF MATERIAL ACCOUNTING POLICIES (continued) ### 2.8 Insurance Contracts (continued) #### 2.8.6 Measurement of insurance contracts (continued) **(i) General provisions (general measurement model) (continued)** **Initial measurement (continued)** On initial recognition, the contractual service margin is an amount arising from: (a) the fulfilment cash flows; (b) the derecognition at the date of initial recognition of any asset for insurance acquisition cash flows and any other asset or liability previously recognised for cash flows related to the group of contracts; (c) any cash flows arising from the contracts in the group at that date. If the total amount represents net cash inflows, the Group recognises it as contract service margin. If the total amount represents net cash outflows, the Group recognises a loss. **Subsequent measurement** The insurance contract liabilities are subsequently measured by the Group at the reporting date at the total of the liabilities for remaining coverage and the liabilities for incurred claims. The liability for remaining coverage includes the fulfilment cash flows related to unexpired coverage period allocated to the group at the reporting date and the contractual service margin of the group at that date. The liability for incurred claims includes the fulfilment cash flows related to claims and other related expenses incurred allocated to the group at the reporting date. For insurance contracts without direct participation features, the carrying amount of the contractual service margin of a group of insurance contracts at the reporting date is adjusted by the Group to reflect the effect of the following changes at the group of contracts level: (a) the effect of any new contracts added to the group; (b) interest accreted on the carrying amount of the contractual service margin for contracts measured using the general measurement model. Interest accreted on the contractual service margin is measured at the locked-in discount rates. The locked-in discount rates are determined at the date of initial recognition of a group of contracts, applied to nominal cash flows that do not vary based on the returns on any underlying items; (c) changes relating to future service; except for - when the changes result in a decrease in the carrying amount of the contractual service margin, and the changes exceed the carrying amount of the contractual service margin. The contractual service margin is reduced to zero, and the excess is recognised in insurance service expenses and a loss component is recognised within the liabilities for remaining coverage; - the above changes adjust the loss component within the liabilities for remaining coverage with correspondence to insurance service expenses. When the changes exceed the amount of loss component, the loss component should be reduced to zero. The remaining should be reinstating the contractual service margin. (d) the effect of any currency exchange differences on the contractual service margin; and (e) the amount recognised as insurance revenue because of the services provided in the period. The Group rationally determines the coverage units of the groups of contracts in each period of the coverage period based on the pattern of provision of insurance contract services, and recognises insurance revenue accordingly over the current and future periods by amortising the carrying amount of the contractual service margin as adjusted for (a) to (d) above. --- # Notes to the Consolidated Financial Statements (continued) For the year ended 31 December 2025 ## 2 SUMMARY OF MATERIAL ACCOUNTING POLICIES (continued) ### 2.8 Insurance Contracts (continued) #### 2.8.6 Measurement of insurance contracts (continued) ##### (i) General provisions (general measurement model) (continued) **Subsequent measurement (continued)** Changes in fulfilment cash flows that related to future services mainly comprise: (a) experience adjustments arising from premiums received in the period that related to future services and related cash flows, measured at the discount rates determined on initial recognition; (b) changes in estimates of the present value of future cash flows in the liabilities for remaining coverage, measured at the discount rates determined on initial recognition, except for those that relate to the effects of the time value of money, financial risk and changes therein; (c) differences between the amount of investment components that were expected to be payable in the period and the amount of investment components that actually became payable; (d) differences between the amount of policy loans that were expected to be receivable in the period and the amount of policy loans that actually became receivable; (e) changes in risk adjustment for non-financial risk that relate to future service. For the treatment results of accounting estimates made in interim financial statements, the Group has elected to adjust them in subsequent interim periods or in the annual reporting period. ##### (ii) Measurement of groups of insurance contracts with direct participation features (variable fee approach) The measurement of variable fee approach is consistent with the general measurement model except for the accounting policies listed below. The Group applies the variable fee approach to measure the insurance contracts with direct participation features. The Group estimates the fulfilment cash flows of the groups of insurance contracts with direct participation features at the difference between the fair value of the underlying items and the variable fee. The variable fee reflects the consideration received by the Group for providing investment-related services by managing the underlying items on behalf of the policyholder, and is equal to the Group’s share of the fair value of the underlying items less the fulfilment cash flows that do not vary based on the return on the underlying items. For groups of insurance contracts measured using the variable fee approach, the carrying amount of the contractual service margin of a group of contracts at each reporting date equals the carrying amount at the start of the reporting period adjusted for: (a) the effect of any new contracts added to the group; (b) the change in the amount of the Group’s share of the fair value of the underlying items, except to the extent that: - the decrease in the amount of the Group’s share of the fair value of the underlying items exceeds the carrying amount of the contractual service margin, giving rise to a loss; - the increase in the amount of the Group’s share of the fair value of the underlying items reverses the loss component of the liabilities for remaining coverage. --- # Notes to the Consolidated Financial Statements (continued) For the year ended 31 December 2025 ## 2 SUMMARY OF MATERIAL ACCOUNTING POLICIES (continued) ### 2.8 Insurance Contracts (continued) #### 2.8.6 Measurement of insurance contracts (continued) **(ii) Measurement of groups of insurance contracts with direct participation features (variable fee approach) (continued)** (c) the changes in fulfilment cash flows relating to future service and do not vary based on the returns of the fair value of underlying items, except to the extent that: - such increases in the fulfilment cash flows exceed the carrying amount of the contractual service margin, giving rise to a loss; - such decreases in the fulfilment cash flows are allocated to the loss component of the liabilities for remaining coverage. (d) the effect of any currency exchange differences on the contractual service margin; and (e) the amount recognised as insurance revenue because of the services provided in the period. The Group identifies the coverage units of the groups of contracts for the coverage period in accordance with the insurance contract service provided, and recognised in the insurance revenue of the current period and subsequent periods accordingly by allocating the carrying amount of the contractual service margin as adjusted for (a) to (d) above. #### (iii) Measurements for onerous insurance contracts If a group of insurance contracts is onerous at the date of initial recognition, or if additional loss caused by contracts added to the group of onerous contracts, the Group recognises a loss as insurance service expenses in profit or loss for the net outflow for the group of onerous contracts, resulting in the carrying amount of the liabilities for remaining coverage for the group being equal to the fulfilment cash flows and the contractual service margin of the group being zero. A group of insurance contracts becomes onerous (or more onerous) on subsequent measurement if it meets one of the following conditions, the Group recognises a loss as insurance service expenses in profit or loss and increases loss component of the liabilities for remaining coverage: (a) the amount of unfavorable changes relating to future service in the fulfilment cash flows changes in estimates of future cash flows and the risk adjustment for non-financial risk exceed the carrying amount of the contractual service margin; (b) for a group of insurance contracts with direct participation features, the decrease in the amount of the Group’s share of the fair value of the underlying items exceed the carrying amount of the contractual service margin. After a loss is recognised, the Group allocates the subsequent changes in fulfilment cash flows of the liabilities for remaining coverage specified as follows on a systematic basis between the loss component and the liabilities for remaining coverage excluding the loss component: (a) estimates of the present value of future cash flows for claims and expenses released from the liabilities for remaining coverage because of incurred insurance service expenses; (b) changes in the risk adjustment for non-financial risk recognised in profit or loss because of the release from risk; and (c) insurance finance income or expenses. Any amounts allocated to the loss component of the liabilities for remaining coverage are not recognised as insurance revenue. --- # Notes to the Consolidated Financial Statements (continued) ## 2 SUMMARY OF MATERIAL ACCOUNTING POLICIES (continued) ### 2.8 Insurance Contracts (continued) #### 2.8.6 Measurement of insurance contracts (continued) ##### (iii) Measurements for onerous insurance contracts (continued) After the Group has recognised a loss on an onerous group of insurance contracts, the subsequent measurements are: (a) for any subsequent increases relating to future service in fulfilment cash flows allocated to the group arising from changes in estimates of future cash flows and the risk adjustment for non-financial risk, and any subsequent decreases in the amount of the Group's share of the fair value of the underlying items, the Group recognises a loss as insurance service expenses in profit or loss and increases the liabilities for remaining coverage; (b) for any subsequent decreases relating to future service in fulfilment cash flows allocated to the group arising from changes in estimates of future cash flows and the risk adjustment for non-financial risk, and any subsequent increases in the amount of the Group's share of the fair value of the underlying items, the Group reverses the insurance service expenses in profit or loss and decreases the loss component of the liabilities for remaining coverage until that component is reduced to zero, the Group adjusts the contractual service margin only for the excess of the decrease over the amount allocated to the loss component. ##### (iv) Simplified approach for measurement of groups of insurance contracts (premium allocation approach) The Group uses the premium allocation approach for measuring the group of insurance contracts with a coverage period of each contract in the group is one year or less, or the Group reasonably expects that the measurement of the liabilities for remaining coverage for the group using the premium allocation approach that would not differ materially from the one that would be produced using general measurement model. **Initial measurement** On initial recognition, the Group measures the liabilities for remaining coverage based on the premiums received minus the insurance acquisition cash flows, minus (or add) the amount of the assets for insurance acquisition cash flows and other related assets or liabilities that is derecognised at the initial recognition. **Subsequent measurement** The carrying amount of insurance contracts liabilities issued at the reporting date is the sum of the liabilities for remaining coverage and the liabilities for incurred claims. At the reporting date, the carrying amount of the liabilities for remaining coverage is the carrying amount at the start of the reporting period plus the premiums received in the period, minus insurance acquisition cash flows, plus any amounts relating to the amortisation of insurance acquisition cash flows recognised as insurance service expenses in the reporting period, plus any adjustment to a financing component, minus the amount recognised as insurance revenue for services provided in that period, and minus any investment component paid or transferred to the liabilities for incurred claims. If, at any time during the coverage period, relevant facts and circumstances indicate that a group of insurance contracts is onerous, the Group will recognise a loss in profit or loss and increase the liabilities for remaining coverage. The Group recognises the liabilities for incurred claims of the insurance contracts as the amount of fulfilment cash flow related to the incurred compensation. --- # Notes to the Consolidated Financial Statements (continued) ## For the year ended 31 December 2025 # 2 SUMMARY OF MATERIAL ACCOUNTING POLICIES (continued) ## 2.8 Insurance Contracts (continued) ### 2.8.7 Measurement of groups of reinsurance contracts held #### (i) Groups of reinsurance contracts not measured using the premium allocation approach On initial recognition, the Group measures a group of reinsurance contracts held at the total of the fulfilment cash flows and the contractual service margin. The contractual service margin represents the net cost or net gain the Group will recognise as it receives insurance contract services from the reinsurer. The fulfilment cash flows for the group of reinsurance contracts held include estimates of future cash flows, an adjustment to reflect the time value of money and the financial risks and a risk adjustment for non-financial risk, which relate directly to fulfil insurance contracts. The Group determines the risk adjustment for non-financial risk so that it represents the amount of risk being transferred by the holder of the group of reinsurance contracts to the issuer of those contracts. The cash flows are within the contract boundary if they arise from substantive rights and obligations of the Group that exist during the reporting period in which the Group is obligated to pay premiums to the reinsurer or in which the Group has a substantive right to receive services from the reinsurer. On initial recognition for a group of reinsurance contracts held, the Group calculates the sum of: a) the fulfilment cash flows; b) the amount derecognised at that date of any asset or liability previously recognised for cash flows related to the group of reinsurance contracts held; c) any cash flows arising from the reinsurance contracts held in the group at that date; d) loss-recovery component of assets for remaining coverage of reinsurance contracts held. The Group recognises any net cost or net gain of the above total amounts as a contractual service margin. The assets for reinsurance contracts held is subsequently measured by the Group at each reporting date at the total of the asset for remaining coverage and the asset for incurred claims. The asset for remaining coverage includes the fulfilment cash flows related to unexpired coverage period allocated to the group of reinsurance contracts held at the reporting date and the contractual service margin of the group at that date. The asset for incurred claims includes the fulfilment cash flows related to recovery of claims and other related expenses incurred allocated to the group of reinsurance contracts held at the reporting date. If the reinsurance contract held is entered into before or at the same time as the onerous underlying insurance contracts are recognised, when the Group recognises a loss on initial recognition of an onerous group of underlying insurance contracts or on addition of onerous underlying insurance contracts to a group, the Group recognises a loss-recovery component of the asset for remaining coverage for such groups of reinsurance contracts held by multiplying: a) the loss recognised on the underlying insurance contracts; and b) the percentage of claims on the underlying insurance contracts the Group expects to recover from the group of reinsurance contracts held. The Group recognises the amount calculated above as an adjustment to contractual service margin and simultaneously as recoveries of insurance service expenses from reinsurers in profit or loss of the period. --- # Notes to the Consolidated Financial Statements (continued) For the year ended 31 December 2025 ## 2 SUMMARY OF MATERIAL ACCOUNTING POLICIES (continued) ### 2.8 Insurance Contracts (continued) #### 2.8.7 Measurement of groups of reinsurance contracts held (continued) **(i) Groups of reinsurance contracts not measured using the premium allocation approach (continued)** When the Group measures the groups of reinsurance contracts held, it adjusts the loss-recovery component to reflect changes in the loss components of the onerous underlying insurance contracts, with the carrying amount of the loss-recovery component not exceeding the portion of the carrying amount of the loss components of the onerous underlying insurance contracts that the Group expects to recover from the group of reinsurance contracts held. The Group measures the contractual service margin at each reporting date for a group of reinsurance contracts held as the carrying amount determined at the start of the reporting period, adjusted for: (a) the effect of contracts added to the group of contracts in the period on the contractual service margin; (b) interest accreted on the carrying amount of the contractual service margin, measured at the discount rates determined at the date of initial recognition of a group of contracts, to nominal cash flows that do not vary based on the returns on any underlying items; (c) the loss-recovery component of the asset for remaining coverage recognised on initial recognition of an onerous group of underlying insurance contracts or on addition of onerous underlying insurance contracts to a group, and reversals of a loss recovery component of the asset for remaining coverage to the extent those reversals are not changes in the fulfilment cash flows of the group of reinsurance contracts held; (d) the changes in the fulfilment cash flows relating to future service, other than the change resulting from a change in fulfilment cash flows allocated to a group of underlying insurance contracts that does not adjust the contractual service margin for the group of underlying insurance contracts, or the change resulting from recognition or reversal of losses from onerous groups of underlying contracts measured applying the premium allocation approach; (e) the effect of any currency exchange differences in the period arising on the contractual service margin; (f) the amortisation of the contractual service margin in the period. The Group rationally determines the coverage units of the group of reinsurance contracts held in each period of the coverage period based on the pattern of receipt of insurance contract services, and recognises profit or loss accordingly over the current and future periods by amortising the carrying amount of the contractual service margin as adjusted for (a) to (e) above. **(ii) Groups of reinsurance contracts measured using the premium allocation approach** The Group applies the same principles to measure the groups of insurance contracts issued and the groups of reinsurance contracts held using the premium allocation approach. When a group of reinsurance contracts held is measured using the premium allocation approach, for the amount recognised and reversed by the loss-recovery component of asset for remaining coverage recovered from reinsurers, the Group adjusts the carrying amount of asset for remaining coverage recovered from reinsurers in the group of reinsurance contracts while recognising the amounts recovered from reinsurers. --- # Notes to the Consolidated Financial Statements (continued) For the year ended 31 December 2025 ## 2 SUMMARY OF MATERIAL ACCOUNTING POLICIES (continued) ### 2.8 Insurance Contracts (continued) #### 2.8.8 Investment contracts with discretionary participation features In addition to the requirements for insurance contracts set out above, the recognition and measurement for investment contract with discretionary participation features are modified as follows: (a) the date of initial recognition is the date the Group becomes party to the contract; (b) the contract boundary is modified so that cash flows are within the contract boundary if they result from a substantive obligation of the Group to deliver cash at a present or future date. The Group has no substantive obligation to deliver cash if the Group has the practical ability to set a price for the promise to deliver the cash that fully reflects the amount of cash promised and related risks; (c) the allocation of the contractual service margin is modified so that the Group recognises the contractual service margin over the duration of the group of contracts in a systematic way that reflects the transfer of investment services under the contract. #### 2.8.9 Modification and derecognition If the terms of an insurance contract are modified, the Group derecognises the original contract and recognises the modified contract as a new contract, if any of the conditions below are satisfied: (a) if the modified terms had been included at contract inception: - the modified contract would have been excluded from the scope of the accounting policies related to insurance contracts; - the Group would have separated different components from the host insurance contract, resulting in a different insurance contract to which the accounting policies related to insurance contracts would have applied; - the modified contract would have had a substantially different contract boundary; or - the modified contract would have been included in a different group of contracts. (b) the original contract met the definition of an insurance contract with direct participation features, but the modified contract no longer meets that definition, or vice versa; or (c) the Group applied the premium allocation approach to the original contract, but the modifications mean that the contract no longer meets the eligibility criteria for that approach. If a contract modification meets none of the conditions above, the Group treats changes in cash flows caused by the modification as changes in estimates of fulfilment cash flows. The Group derecognises an insurance contract when it is extinguished, i.e. when the obligation specified in the insurance contract expires or is discharged or cancelled. #### 2.8.10 Presentation **(i) Insurance revenue** The Group recognises the reduction in the liabilities for remaining coverage because of services provided in the period as insurance revenue. The amount of insurance revenue recognised in the reporting period depicts the transfer of promised services at an amount that reflects the portion of consideration that the Group expects to be entitled to in exchange for those services. --- # Notes to the Consolidated Financial Statements (continued) For the year ended 31 December 2025 ## 2 SUMMARY OF MATERIAL ACCOUNTING POLICIES (continued) ### 2.8 Insurance Contracts (continued) **2.8.10 Presentation (continued)** **(i) Insurance revenue (continued)** For contracts not measured using the premium allocation approach, insurance revenue includes the following: (a) Amounts related to the changes in the liabilities for remaining coverage; - **insurance service expenses** incurred in the period measured at the amounts expected at the beginning of the period, excluding: a) amounts allocated to the loss component; b) repayments of investment components; c) amounts that relate to transaction-based taxes collected on behalf of third parties; and d) insurance acquisition cash flows. - **the changes in the risk adjustment for non-financial risk**, excluding: a) changes included in insurance finance income or expenses; b) changes that relate to future service that adjust the contractual service margin; and c) amounts allocated to the loss component. - **amounts of the contractual service margin amortised**; and - **other**. (b) The Group determines insurance service expenses related to insurance acquisition cash flows in a systematic way on the basis of the passage of time. The Group recognises the same amount as insurance revenue to reflect the portion of the premiums that relate to recovering those cash flows. For groups of insurance contracts measured using the premium allocation approach, the Group recognises insurance revenue based on the passage of time over the coverage period of a group of contracts. **(ii) Insurance service expenses** The Group recognises the increase in the liabilities for incurred claims because of claims and expenses incurred in the period and any subsequent changes in fulfilment cash flows relating to incurred claims and incurred expenses as insurance service expenses. --- # Notes to the Consolidated Financial Statements (continued) For the year ended 31 December 2025 ## 2 SUMMARY OF MATERIAL ACCOUNTING POLICIES (continued) ### 2.8 Insurance Contracts (continued) #### 2.8.10 Presentation (continued) **(ii) Insurance service expenses (continued)** Insurance service expenses include the following: (a) claims and other related expenses incurred in the period, excluding investment components; (b) amortisation of insurance acquisition cash flows; (c) changes that relate to past service – changes in the fulfilment cash flow relating to the liabilities for incurred claims; and (d) changes that relate to future service – changes in the fulfilment cash flow that result in onerous contract losses or reversals of those losses. For contracts not measured using the premium allocation approach, amortisation of insurance acquisition cash flows is reflected in insurance service expenses in the same amount as insurance acquisition cash flows recovery reflected within insurance revenue. For contracts measured using the premium allocation approach, amortisation of insurance acquisition cash flows is based on the passage of time. **(iii) Allocation of reinsurance premiums paid** The Group recognises the reduction in the asset for remaining coverage because of insurance contract services received from the reinsurer in the period as allocation of reinsurance premiums paid. The Group treats amounts from the reinsurer that it expects to receive that are not contingent on claims of the underlying contracts as the reduction to the allocation of reinsurance premiums paid. Allocation of reinsurance premiums paid excludes any investment components of the reinsurance contracts held. **(iv) Amounts recovered from reinsurers** The increase in the carrying amount of the incurred claims for reinsurance contracts held incurred due to the incurred claims and other directly attributable expenses in the current period, as well as the subsequent changes in the related fulfilment cash flows, are recognised as the amounts recovered from reinsurers. The Group does not include the investment component of the reinsurance contracts held when recognizing the amounts recovered from reinsurers. **(v) Financial changes in insurance contracts** Insurance finance income or expenses comprises the change in the carrying amount of the group of insurance contract liabilities and reinsurance contract assets arising from: (a) the effect of the time value of money and changes in the time value of money; (b) the effect of financial risk and changes in financial risk. The Group disaggregates the financial changes in insurance contracts into insurance finance income or expenses from insurance contracts issued, reinsurance finance income or expenses from reinsurance contracts held and other comprehensive income. For the contracts not measured using the variable fee approach, the changes in carrying amount of insurance contract liabilities arising from the financial risk changing, such as discount rate, are recognised in other comprehensive income; For the contracts measured using the variable fee approach, insurance finance income or expenses equal to the amounts that can eliminate accounting mismatches arising from profit or loss from underlying items, and the remainders are recognised in other comprehensive income. --- # Notes to the Consolidated Financial Statements (continued) For the year ended 31 December 2025 ## 3 SUMMARY OF OTHER ACCOUNTING POLICIES ### 3.1 Segment reporting The Group’s operating segments are presented in a manner consistent with the internal management reporting provided to the operating decision maker – president office for deciding how to allocate resources and for assessing performance. Operating segment refers to the segment within the Group that satisfies the following conditions: i) the segment generates income and incurs costs from daily operating activities; ii) management evaluates the operating results of the segment to make resource allocation decision and to evaluate the business performance; and iii) the Group can obtain relevant financial information of the segment, including financial condition, operating results, cash flows and other financial performance indicators. ### 3.2 Foreign currency translation The Company’s functional currency is RMB. Each entity in the Group determines its own functional currency and items included in the financial statements of each entity are measured using that functional currency. The reporting currency of the consolidated financial statements of the Group is RMB. Transactions in foreign currencies are translated at the exchange rates ruling at the transaction dates. Monetary assets and liabilities denominated in foreign currencies are translated at the exchange rates ruling at the end of the reporting period. Exchange differences arising in these cases are recognised in net profit. ### 3.3 Derivative instruments Derivatives are initially recognised at fair value on the date on which a derivative contract is entered into and are subsequently re-measured at their fair value. Except for those related to hedge accounting, the resulting gain or loss of derivative financial instruments is recognised in net profit. All derivatives are carried as financial assets when fair value is positive and as financial liabilities when fair value is negative. ### 3.4 Property, plant and equipment Property, plant and equipment, are stated at historical costs less accumulated depreciation and any accumulated impairment losses, except for those acquired prior to 30 June 2003, which are stated at deemed cost less accumulated depreciation and any accumulated impairment losses. #### Depreciation The historical costs of property, plant and equipment comprise its purchase price, including import duties and non-refundable purchase taxes, and any directly attributable costs of bringing the asset to its working condition and location for its intended use. Expenditure incurred after terms of property, plant and equipment have been put into operation, such as repairs and maintenance, is normally charged to the statement of comprehensive income in the period in which it is incurred. In situations where the recognition criteria are satisfied, the expenditure for a major inspection is capitalised in the carrying amount of the assets as a replacement. Where significant parts of property, plant and equipment are required to be replaced at intervals, the Group recognises such parts as individual assets with specific useful lives and depreciates them accordingly. Depreciation is computed on a straight-line basis to write down the cost of each asset to its residual value over its estimated useful lives as follows: | | Estimated useful lives | | :--- | :--- | | Buildings | 15 to 35 years | | Office equipment, furniture and fixtures | 3 to 11 years | | Motor vehicles | 4 to 8 years | | Leasehold improvements | Over the shorter of the remaining term of the lease and the useful lives | The residual values, depreciation method and useful lives are reviewed periodically to ensure that the method and period of depreciation are consistent with the expected pattern of economic benefits from items of property, plant and equipment. --- # Notes to the Consolidated Financial Statements (continued) For the year ended 31 December 2025 # 3 SUMMARY OF OTHER ACCOUNTING POLICIES (continued) ## 3.4 Property, plant and equipment (continued) ### *Depreciation (continued)* Assets under construction mainly represent buildings under construction, which are stated at cost less any impairment losses and are not depreciated, except for those acquired prior to 30 June 2003, which are stated at deemed cost less any accumulated impairment losses. Cost comprises the direct costs of construction and capitalised borrowing costs on related borrowed funds during the period of construction. Assets under construction are reclassified to the appropriate category of property, plant and equipment, investment properties or other assets when completed and ready for use. ### *Impairment and gains or losses on disposals* Property, plant and equipment are reviewed for impairment losses whenever events or changes in circumstances indicate that the carrying amount may not be recoverable. An impairment loss is recognised in net profit for the amount by which the carrying amount of the asset exceeds its recoverable amount, which is the higher of an asset’s net selling price and value in use. The gain or loss on disposal of an item of property, plant and equipment is the difference between the net sales proceeds and the carrying amount of the relevant asset, and is recognised in net profit. ## 3.5 Leases At inception of a contract, the Group assesses whether the contract is, or contains, a lease. A contract is, or contains, a lease if the contract conveys the right to control the use of an identified asset for a period of time in exchange for consideration. To assess whether a contract conveys the right to control the use of an identified asset for a period of time, the Group assesses whether, throughout the period of use, the lessee has the right to obtain substantially all of the economic benefits from use of the identified asset and the right to direct the use of the identified asset. ### *As a lessee* **Initial measurement** At the commencement date of the lease, the Group recognises right-of-use assets representing the right to use the leased assets, including buildings. The Group measures the lease liability at the present value of the lease payments that are not paid at that date, except for short-term leases and leases of low-value assets. For short-term leases with a lease term of not more than 12 months and low-value asset leases with a lower value when the individual asset is new, the Group chooses not to recognise the right of use assets and lease liabilities and recognises the relevant rental expenses in profit or loss or the cost of the relevant asset on a straight-line basis over each period of the lease term. In calculating the present value of the lease payments, the lease payments are discounted using the interest rate implicit in the lease. If that rate cannot be readily determined, the Group uses its own incremental borrowing rate. The lease term is the non-cancellable period of a lease when the Group has the right to use lease assets. When the Group has an option to extend a lease and is reasonably certain to exercise that option to extend a lease, the lease term also comprises the periods covered by the option to extend the lease. When the Group has an option to terminate the lease and is reasonably certain not to exercise that option, the lease term also comprises the periods covered by the option to terminate the lease. The Group reassesses whether it is reasonably certain to exercise an extension option, to exercise a purchase option or not to exercise a termination option, upon the occurrence of either a significant event or a significant change in circumstances that are within the control of the Group and affects whether the Group is reasonably certain to exercise the commensurate options. --- # 3 SUMMARY OF OTHER ACCOUNTING POLICIES (continued) ## 3.5 Leases (continued) ### As a lessee (continued) **Subsequent measurement** The Group applies the straight-line method in depreciating the right-of-use assets. If it is reasonably certain that ownership of a leased asset transfers to the Group at the end of the lease term, the leased asset is depreciated under the remaining useful life of the asset. If it cannot be reasonably determined that ownership of a leased asset transfers to the Group at the end of the lease term, the Group depreciates the right-of-use asset from the commencement date to the earlier of the end of the lease term or the end of the useful life of the right-of-use asset. The Group uses a constant periodic rate of interest to calculate interest on the lease liability in each period during the lease term and recognises the interest in profit or loss. Variable lease payments not included in the measurement of the lease liability are recognised in profit or loss in the period in which the event or condition that triggers the payment occurs. After the commencement date of a lease, when there is a change in substance fixed payments, a change in the amounts expected to be payable under a residual value guarantee, a change in future lease payments resulting from a change in an index or a rate used to determine those payments, a change in the assessment or actual exercise situation of a purchase option, an extension option or a termination option, the Group uses the changed present value of lease payments to remeasure the lease liability and adjust the carrying amount of right-of-use asset accordingly. If the carrying amount of the right-of-use asset is reduced to zero and there is a further reduction in the measurement of the lease liability, the Group recognises any remaining amount of the remeasurement in profit or loss. ### As a lessor At the commencement date of the lease, leases in which the Group does not transfer substantially all the risks and rewards incidental to ownership of an asset are classified as operating leases. Rental income arising is accounted for on a straight-line basis over the lease terms and is included in revenue in the statement of profit or loss. ## 3.6 Investment properties Investment properties are interests in land use rights and buildings that are held to earn rental income and/or for capital appreciation, rather than for the supply of services or for administrative purposes. Investment properties are measured initially at cost, including transaction costs. Subsequent to initial recognition, investment properties are stated at cost less accumulated depreciation and any impairment loss. Depreciation is computed on the straight-line basis over the estimated useful lives. The estimated useful lives of investment properties are **15 to 35 years**. Overseas investment properties, that are held by the Group in the form of property ownership, equity investment, or other forms, have expected useful lives **not longer than 50 years**, determined based on the usage in their locations. The useful lives and depreciation method are reviewed periodically to ensure that the method and period of depreciation are consistent with the expected pattern of economic benefits from the individual investment properties. An investment property is derecognised when either it has been disposed of or when the investment property is permanently withdrawn from use and no future economic benefit is expected from its disposal. Any gains or losses on the retirement or disposal of an investment property are recognised in the statement of comprehensive income in the year of retirement or disposal. A transfer to, or from, an investment property is made when, and only when, there is evidence of a change in use. --- # Notes to the Consolidated Financial Statements (continued) For the year ended 31 December 2025 ## 3 SUMMARY OF OTHER ACCOUNTING POLICIES (continued) ### 3.7 Employee benefits **Pension benefits** Full-time employees of the Group are covered by various government-sponsored pension plans, under which the employees are entitled to a monthly pension based on certain formulae. These government agencies are responsible for the pension liability to these employees upon retirement. The Group contributes on a monthly basis to these pension plans. All contributions made under the government-sponsored pension plans described above are fully attributable to employees at the time of the payment and the Group is unable to forfeit any amounts contributed by it to such plans. In addition to the government-sponsored pension plans, the Group established an employee annuity fund plan pursuant to the relevant laws and regulations in the PRC, whereby the Group is required to contribute to the plan at fixed rates of the employees' salary costs. Contributions made by the Group under the annuity fund plan that is forfeited in respect of those employees who resign from their positions prior to the full vesting of the contributions will be recorded in the public account of the annuity fund and shall not be used to offset any contributions to be made by the Group in the future. All funds in the public account will be attributed to the employees whose accounts are in normal status after the approval procedures are completed as required. Under these plans, the Group has no legal or constructive obligation for retirement benefit beyond the contributions made. **Housing benefits** All full-time employees of the Group are entitled to participate in various government-sponsored housing funds. The Group contributes on a monthly basis to these funds based on certain percentages of the salaries of the employees. The Group's liability in respect of these funds is limited to the contributions payable in each year. **Stock appreciation rights** Compensation under the stock appreciation rights is measured based on the fair value of the liabilities incurred and is expensed over the vesting period. Valuation techniques including option pricing models are used to estimate fair value of relevant liabilities. The liability is re-measured at each reporting period to its fair value until settlement. Fair value changes in the vesting period are included in administrative expenses and changes after the vesting period are included in net fair value gains through profit or loss in net profit. The related liability is included in other liabilities. ### 3.8 Premiums received in advance The advance premiums received by the Group are mainly premiums received for insurance contracts that have not yet met the criteria for initial recognition. ### 3.9 Share capital Ordinary shares are classified as equity. Incremental costs directly attributable to the issue of equity instruments are shown in equity as a deduction, from the proceeds. ### 3.10 Current and deferred income taxation Income tax expense for the period comprises current and deferred tax. Income tax is recognised in net profit, except to the extent that it relates to items recognised directly in other comprehensive income where the income tax is recognised in other comprehensive income. Current income tax assets and liabilities for the current period are calculated on the basis of the tax laws enacted or substantively enacted at the end of each reporting period in the jurisdictions where the Company and its subsidiaries operate and generate taxable income. Management periodically evaluates positions taken with respect to situations in which applicable tax regulations are subject to interpretation. Deferred income tax is recognised, using the liability method, on temporary differences arising between the tax bases of assets and liabilities and their carrying amounts in the consolidated financial statements. Substantively enacted tax rates are used in the determination of deferred income tax. Deferred income tax is provided on temporary differences arising on investments in subsidiaries, associates and joint ventures except where the timing of the reversal of the temporary difference can be controlled and it is probable that the temporary difference will not be reversed in the foreseeable future. --- # Notes to the Consolidated Financial Statements (continued) For the year ended 31 December 2025 ## 3 SUMMARY OF OTHER ACCOUNTING POLICIES (continued) ### 3.10 Current and deferred income taxation (continued) The carrying amount of deferred tax assets is reviewed at the end of each reporting period and reduced to the extent that it is no longer probable that sufficient taxable profit will be available to allow all or part of the deferred tax asset to be utilised. Conversely, previously unrecognised deferred tax assets are reassessed by the end of each reporting period and are recognised to the extent that it is probable that sufficient taxable profit will be available to allow all or part of the deferred tax asset to be utilised. Deferred tax assets and deferred tax liabilities are measured at the tax rates that are expected to apply to the period when the asset is realised or the liability is settled, based on tax rates (and tax laws) that have been enacted or substantively enacted at the end of the reporting period. Deferred tax assets and deferred tax liabilities are offset if and only if the Group has a legally enforceable right to set off current tax assets and current tax liabilities and the deferred tax assets and deferred tax liabilities relate to income tax levied by the same taxation authority on either the same taxable entity or different taxable entities which intend either to settle current tax liabilities and assets on a net basis, or to realise the assets and settle the liabilities simultaneously, in each future period in which significant amounts of deferred tax liabilities or assets are expected to be settled or recovered. ### 3.11 Provisions and contingencies Provisions are recognised when the Group has a present legal or constructive obligation as a result of past events; it is probable that an outflow of resources will be required to settle the obligation; and the amount has been reliably estimated. Provisions are not recognised for future operating losses. A contingent liability is a possible obligation that arises from past events and whose existence will only be confirmed by the occurrence or non-occurrence of one or more uncertain future events not wholly within the control of the Group. It can also be a present obligation arising from past events that is not recognised because it is not probable that outflow of economic resources will be required, or the amount of obligation cannot be measured reliably. A contingent liability is not recognised in the consolidated statement of financial position but is disclosed in the notes to the consolidated financial statements. When a change in the probability of an outflow occurs so that such outflow is probable and can be reliably measured, it will then be recognised as a provision. ### 3.12 Dividend distribution Dividend distribution to the Company’s equity holders is recognised as a liability in the Group’s consolidated financial statements in the year in which the dividends are approved by the equity holders of the Company. ## 4 CRITICAL ACCOUNTING ESTIMATES AND JUDGEMENTS The Group makes estimates and assumptions that affect the reported amounts of income, expenses, assets and liabilities. Estimates and judgements are continually evaluated and based on historical experience and other factors, including expectations of future events that are believed to be reasonable under the circumstances. The Group exercises significant judgement in making appropriate assumptions. It is possible that actual results may be different from the estimates and judgements referred to below. The actual result may have significant differences in accordance with changes in accounting estimates and professional judgement. ### 4.1 Insurance contracts #### 4.1.1 Portfolios of contracts The Group identifies portfolios of insurance contracts as contracts subject to similar risks and are managed together. The Group makes judgments about whether it has similar risk factors and management methods. --- # Notes to the Consolidated Financial Statements (continued) For the year ended 31 December 2025 # 4 CRITICAL ACCOUNTING ESTIMATES AND JUDGEMENTS (continued) ## 4.1 Insurance contracts (continued) ### 4.1.2 Investment components The Group has established rules to unbundle non-distinct investment components. Generally, for relevant contracts, the Group determines the non-distinct investment components based on cash surrender values and similar contractual terms. ### 4.1.3 Determination of coverage unit The Group’s unit of coverage is determined by considering the benefits provided by each contract and its expected duration of insurance coverage. For policies that include investment return services or investment-related services, the amount corresponding to the investment return service or investment-related service is the investment component or one of the amounts that the policyholder is entitled to recover. ### 4.1.4 Estimates of future benefit payments and premiums arising from insurance contracts not using the premium allocation approach Fulfilment cash flows are determined on the basis of the Group’s estimates of future benefits, premiums and related expenses, taking into account the risk adjustment for non-financial risk. The discount rate, mortality rate, morbidity rate, lapse rate, expense assumption and policy dividend assumption used for the estimation of future cash flows are determined according to the latest empirical analysis, current conditions and forecasts of the future. The judgments and estimates used in the valuation process will affect the amount recognised in the consolidated financial statements for insurance contracts and reinsurance contracts held. The description of the above assumptions is detailed in Note 14.1. ## 4.2 Financial instruments The critical estimates and judgements are those associated with investment classification, the recognition of impairment and the measurement of fair value. ### 4.2.1 Classification of financial assets Significant judgements made by the Group in the classification of financial assets include business model and analysis on contractual cash flow characteristics. The Group’s assessment of the business model is performed on a financial asset portfolio basis, and determined on the basis of scenarios which are reasonably expected to occur, taking into account: how cash flows were realised in the past, how the performance are evaluated and reported to the entity’s key management personnel; the risks that affect the performance and the way in which those risks are assessed and managed; and how managers of the business are compensated, etc. When assessing whether contractual cash flow characteristics of financial assets are consistent with basic lending arrangement, key judgements made by the Group include: the possibility of changes in timing or amount of the principal during the duration due to reasons such as early repayment; whether interest only includes considerations for time value of money, credit risks, other basic lending risks, costs and profits. For example, whether the prepayment amount only reflects the principal outstanding and the interest on the principal outstanding, as well as the reasonable compensation for the early termination of the contract. ### 4.2.2 Measurement of ECL The Group calculates ECL through default risk exposure and ECL rate, and determines the ECL rate based on default probability and default loss rate. In determining the ECL rate, the Group uses data such as internal historical credit loss experience, and adjusts historical data based on current conditions and forward-looking information. --- # Notes to the Consolidated Financial Statements (continued) For the year ended 31 December 2025 ## 4 CRITICAL ACCOUNTING ESTIMATES AND JUDGEMENTS (continued) ### 4.2 Financial instruments (continued) #### 4.2.3 Fair value of financial instruments Fair value, in the absence of an active market, is estimated by using valuation techniques, applying currently applicable and sufficiently available data, and the valuation techniques supported by other information, mainly include market approach and income approach, reference to the recent arm’s length transactions, current market value of another instrument which is substantially the same, and by using the discounted cash flow analysis and option pricing models. When using valuation techniques to determine the fair value of financial instruments, the Group would choose the input value in consistent with market participants, considering the transactions of related assets and liabilities. All related observable market parameters are considered in priority, including interest rate, foreign exchange rate, commodity prices and share prices or index. When related observable parameters are unavailable or inaccessible, the Group uses unobservable parameters and makes estimates for credit risk, market volatility and liquidity adjustments. For the description of valuation techniques, please refer to Note 5.4. Using different valuation techniques and parameter assumptions may lead to significant differences of fair value estimations. ### 4.3 Impairment of investments in subsidiaries, associates and joint ventures The Group assesses whether there are any indicators of impairment for investments in subsidiaries, associates and joint ventures at the end of each reporting period. Investments in subsidiaries, associates and joint ventures are tested for impairment when there are indicators that the carrying amounts may not be recoverable. An impairment exists when the carrying value of investments in subsidiaries, associates and joint ventures exceeds its recoverable amount, which is the higher of its fair value less costs of disposal and its value in use. The calculation of the fair value less costs of disposal is based on available data from binding sales transactions in an arm’s length transaction of similar assets or observable market prices less incremental costs for disposing of investments in subsidiaries, associates and joint ventures. When value in use calculations are undertaken, the Group must estimate the expected future cash flows from investments in subsidiaries, associates and joint ventures and choose a suitable discount rate in order to calculate the present value of those cash flows. ### 4.4 Income tax measurement and recognition of deferred tax assets The Group is subject to income tax in numerous jurisdictions. During the normal course of business, certain transactions and activities for which the ultimate tax determination is uncertain, the Group needs to exercise significant judgement when determining the income tax. If the final settlement results of the tax matters are different from the amounts recorded, these differences will impact the final income tax expense and deferred tax for the period. Deferred tax assets are recognised for all unused tax losses to the extent that it is probable that taxable profit will be available against which the loss and timing difference can be utilised. The Group recognises the amount of deferred tax assets based on a reasonable expectation of future taxable profits. ### 4.5 Determination of control over investee The Group applies its judgement to determine whether the control indicators set out in Note 2.2 indicate that the Group controls structured entities such as funds and asset management products. The Group issues certain structured entities (e.g. funds and asset management products), and acts as a manager for such entities according to the contracts. Meanwhile, the Group may be exposed to variability of returns as a result of holding shares of the structured entities. In addition, the Group may also hold structured entities initiated and managed by other asset management institutions (such as trust schemes). Determining whether the Group controls such structured entities usually focuses on the assessment of the aggregate economic interests of the Group in the entities (including any carried interests and expected management fees) and the decision-making rights on the entity. As at 31 December 2025, the Group has consolidated some funds issued and managed by the Company’s subsidiary, China Life AMP Asset Management Company (“CL AMP”), some debt investment schemes and asset management products issued and managed by the Company’s subsidiary, China Life Asset Management Company Limited (“AMC”) and some trust schemes, Equity Investment Plan and debt investment schemes issued and managed by third parties in the consolidated financial statements. Please refer to Note 31(b) for the details. --- # Notes to the Consolidated Financial Statements (continued) For the year ended 31 December 2025 # 5 RISK MANAGEMENT Risk management is carried out by the Company’s Risk Management Committee under policies approved by the Company’s Board of Directors. The Group issues contracts that transfer insurance risk or financial risk or both. This section summarises these risks and the way the Group manages them. ## 5.1 Insurance risk ### 5.1.1 Types of insurance risks The risk under any one insurance contract is the possibility that an insured event occurs and the uncertainty about the time and amount of the resulting claim. By the very nature of an insurance contract, this risk is random and therefore unpredictable. For a portfolio of insurance contracts where the theory of probability is applied to the pricing and provisioning for the insurance contract liabilities, the main risk to the Group is that actual claims are paid in excess of the carrying value of the insurance contract liabilities. This occurs when the frequency or severity of claims and benefits exceeds the estimates. Insurance events are random, and the actual number of claims and the amount of benefits paid will vary each year from estimates established using statistical techniques. The business of the Group mainly comprises long-term individual and group life insurance, annuity insurance, accident insurance and health insurance, as well as short-term individual and group accident and health insurance. For the Group’s insurance business, factors such as epidemics, natural disasters, accidents, profound lifestyle changes, constant improvements in medical and social conditions may affect frequency, timing, and amounts of claims. Insurance risk is also affected by policyholders’ rights to terminate contracts, reduce premiums, refuse to pay premiums or exercise annuity conversion rights. Thus, insurance risk is also subject to policyholders’ behaviours and decisions. Experience shows that the greater the number of similar policies underwritten, the more the risks are diversified, the smaller the relative variability of the expected outcome will be. The Group has developed its insurance underwriting strategy to diversify the types of insurance risks accepted and within each of these categories to achieve a sufficiently large population to reduce the variability of the expected outcome. The Group manages insurance risks through effective reinsurance agreements, ceding on a quota share basis, a surplus basis, and a catastrophe excess of loss reinsurance to cover insurance liability risk. Reinsurance contracts cover almost all products, which contain risk liabilities. The products reinsured include: life insurance, accident and health insurance or death, disability, accident and illness in terms of product category or function, respectively. These reinsurance agreements spread insured risk to a certain extent and reduce the effect of potential losses to the Group. However, the Group’s direct insurance liabilities to the policyholder are not eliminated under the reinsurance arrangements. The Group collaborates with multiple reinsurance companies to mitigate reliance on any single reinsurer. ### 5.1.2 Concentration of insurance risks Currently, the Group’s insurance operation is mainly located in the PRC. There are no significant differences among the regions where the Group underwrites insurance contracts. --- # Notes to the Consolidated Financial Statements (continued) For the year ended 31 December 2025 ## 5 RISK MANAGEMENT (continued) ### 5.1 Insurance risk (continued) #### 5.1.3 Sensitivity analysis **Sensitivity analysis of contracts not measured using the premium allocation approach** Significant assumptions involved in calculation of insurance contract liabilities include mortality, morbidity, lapse rate and discount rate, etc. If holding all other variables constant, the Group considers the expected effect of changes in assumptions on mortality, morbidity and lapse rate on **consolidated profit before income tax** and **consolidated other comprehensive income before income tax** for the year, and considers the effect of risk mitigation on insurance contracts and reinsurance contracts held, as follows. For effect of changes in assumption on discount rate, please refer to Note 5.2.1(i). **For the year ended 31 December** (Unit: RMB million) | Assumptions | Changes in assumptions | 2025: Effect on profit before income tax (Before reinsurance) | 2025: Effect on profit before income tax (After reinsurance) | 2025: Effect on other comprehensive income before income tax (Before reinsurance) | 2025: Effect on other comprehensive income before income tax (After reinsurance) | 2024: Effect on profit before income tax (Before reinsurance) | 2024: Effect on profit before income tax (After reinsurance) | 2024: Effect on other comprehensive income before income tax (Before reinsurance) | 2024: Effect on other comprehensive income before income tax (After reinsurance) | | :--- | :--- | :---: | :---: | :---: | :---: | :---: | :---: | :---: | :---: | | Mortality/Morbidity rate | Increase by 10% | (6,557) | (4,617) | (7,825) | (4,989) | (6,458) | (4,560) | (9,008) | (5,975) | | Mortality/Morbidity rate | Decrease by 10% | 6,660 | 4,688 | 8,500 | 5,515 | 6,523 | 4,579 | 9,777 | 6,589 | | Lapse rate | Increase by 10% | 2,883 | 2,600 | 9,901 | 9,573 | 2,307 | 2,031 | 11,224 | 10,860 | | Lapse rate | Decrease by 10% | (2,247) | (1,952) | (10,039) | (9,695) | (1,644) | (1,355) | (11,338) | (10,956) | **Sensitivity analysis of contracts measured using the premium allocation approach** Changes in factors such as the amount of contractual claims measured using the premium allocation approach have the potential to affect changes in the assumed level of the reserve for outstanding claims, which in turn affects the simultaneous changes in the liabilities for incurred claims. If holding all other variables constant, the Group considers the following expected effect of changes in claim ratios assumption on **consolidated profit before income tax** for the year. Without considering the ceded business, holding all other variables constant, if claim ratios are 100 basis points higher or lower than the current assumption, the consolidated pre-tax profit is expected to be RMB240 million (as at 31 December 2024: RMB253 million) lower or higher, respectively; With consideration of ceded business, holding all other variables constant, if claim ratios are 100 basis points higher or lower than the current assumption, the consolidated pre-tax profit is expected to be RMB234 million (as at 31 December 2024: RMB242 million) lower or higher, respectively. --- # Notes to the Consolidated Financial Statements (continued) For the year ended 31 December 2025 ## 5 RISK MANAGEMENT (continued) ### 5.1 Insurance risk (continued) #### 5.1.3 Sensitivity analysis (continued) **Sensitivity analysis of contracts measured using the premium allocation approach (continued)** The following table indicates the claim development for contracts measured using the premium allocation approach without taking into account the impacts of ceded business: | Contracts measured using the premium allocation approach (accident year) | 2021 | 2022 | 2023 | 2024 | 2025 | Total | | :--- | :---: | :---: | :---: | :---: | :---: | :---: | | **RMB million** | | | | | | | | **Estimated accumulated undiscounted claims expenses (before reinsurance)** | | | | | | | | Year end | 57,727 | 55,256 | 62,411 | 68,200 | 64,235 | | | 1 year later | 57,642 | 54,879 | 61,693 | 68,995 | | | | 2 years later | 56,890 | 55,294 | 61,875 | | | | | 3 years later | 57,072 | 55,390 | | | | | | 4 years later | 57,139 | | | | | | | Accumulated claims expenses paid | (57,066) | (55,223) | (61,393) | (66,816) | (44,117) | (284,615) | | Total liabilities – Accident years from 2021 to 2025 | 73 | 167 | 482 | 2,179 | 20,118 | 23,019 | | Total liabilities – Accident years before 2021 | | | | | | 77 | | Effect of indirect claims expenses, risk adjustment for non-financial risk and discounting, etc. | | | | | | 5,042 | | **Total liabilities for incurred claims** | | | | | | **28,138** | The following table indicates the claim development for contracts measured using the premium allocation approach with taking into account the impacts of ceded business: | Contracts measured using the premium allocation approach (accident year) | 2021 | 2022 | 2023 | 2024 | 2025 | Total | | :--- | :---: | :---: | :---: | :---: | :---: | :---: | | **RMB million** | | | | | | | | **Estimated accumulated undiscounted claims expenses (after reinsurance)** | | | | | | | | Year end | 56,651 | 53,416 | 60,896 | 66,629 | 63,001 | | | 1 year later | 56,125 | 52,694 | 59,873 | 67,268 | | | | 2 years later | 55,395 | 53,535 | 60,448 | | | | | 3 years later | 55,574 | 53,637 | | | | | | 4 years later | 55,647 | | | | | | | Accumulated claims expenses paid | (55,579) | (53,481) | (59,979) | (65,360) | (43,143) | (277,542) | | Total liabilities – Accident years from 2021 to 2025 | 68 | 156 | 469 | 1,908 | 19,858 | 22,459 | | Total liabilities – Accident years before 2021 | | | | | | 76 | | Effect of indirect claims expenses, risk adjustment for non-financial risk and discounting, etc. | | | | | | 2,623 | | **Total liabilities for incurred claims** | | | | | | **25,158** | --- # Notes to the Consolidated Financial Statements (continued) For the year ended 31 December 2025 ## 5 RISK MANAGEMENT (continued) ### 5.2 Financial risk The Group’s activities are exposed to a variety of financial risks. The key financial risk is that proceeds from the sale of financial assets will not be sufficient to fund the obligations arising from the Group’s insurance and investment contracts. The most important components of financial risk are market risk, credit risk and liquidity risk. The Group’s overall risk management program focuses on the unpredictability of financial markets and seeks to minimise potential adverse effects on the financial performance of the Group. Risk management is carried out by a designated department under policies approved by management. The responsible department identifies, evaluates and manages financial risks in close cooperation with the Group’s operating units. The Group provides written principles for overall risk management, as well as written policies covering specific areas, such as managing market risk, credit risk, and liquidity risk. The Group manages financial risk by holding an appropriately diversified investment portfolio as permitted by laws and regulations designed to reduce the risk of concentration in any one specific industry or issuer. The structure of the investment portfolio held by the Group is disclosed in Note 11. The sensitivity analyses below are based on a change in an assumption while holding all other assumptions constant. In practice this is unlikely to occur, and changes in some of the assumptions may be correlated, such as change in interest rate and change in market price. #### 5.2.1 Market risk **(i) Interest rate risk** Interest rate risk refers to the risk that the value of financial instruments and the measurement results of insurance contracts will fluctuate due to changes in market interest rates. The Group’s financial assets are principally comprised of debt instruments which are exposed to interest rate risk. Changes in the level of interest rates could have a significant impact on the Group’s investment return, as well as an impact on the measurement of the Group’s insurance contracts and reinsurance contracts held. The Group manages interest rate risk through adjustments to portfolio structure and duration, and, to the extent possible, by matching the duration of its assets and liabilities. The sensitivity analysis for interest rate risk illustrates how changes in interest income, the fair value of future cash flows of a financial instrument, insurance contract liabilities and other items will fluctuate because of changes in market interest rates. As at 31 December 2025, if market interest rates were 50 basis points higher or lower with all other variables held constant, profit before income tax for the year would have increased by RMB17,846 million or decreased by RMB48,344 million (as at 31 December 2024: increase by RMB23,873 million or decrease by RMB56,871 million), respectively, mainly as a result of higher or lower interest income on floating rate instruments, the fair value gains or losses on fixed and floating rate instruments, and the change of insurance contract liabilities. Other comprehensive income before income tax would have decreased by RMB13,272 million or increased by RMB403 million (as at 31 December 2024: increase by RMB331 million or decrease by RMB12,537 million), respectively, mainly due to the fair value gains or losses on investments in debt instruments at fair value through other comprehensive income, and the change of insurance contract liabilities. **Sensitivity Analysis for Interest Rate Risk (±50 basis points)** | Impact on | Scenario | 31 December 2025 (RMB million) | 31 December 2024 (RMB million) | | :--- | :--- | :--- | :--- | | **Profit before income tax** | +50 basis points | 17,846 | 23,873 | | | -50 basis points | (48,344) | (56,871) | | **Other comprehensive income before income tax** | +50 basis points | (13,272) | 331 | | | -50 basis points | 403 | (12,537) | **(ii) Price risk** Price risk arises mainly from the volatility of market prices of the financial instruments held by the Group. The Group is subject to increased price risk mainly because of the volatility of capital markets. The Group’s insurance contracts using the variable fee approach are exposed to price risk. The Group manages price risk by holding an appropriately diversified investment portfolio as permitted by laws and regulations designed to reduce the risk of price concentration in any one specific industry or issuer. --- # Notes to the Consolidated Financial Statements (continued) For the year ended 31 December 2025 ## 5 RISK MANAGEMENT (continued) ### 5.2 Financial risk (continued) #### 5.2.1 Market risk (continued) **(ii) Price risk (continued)** As at 31 December 2025, if the prices of all the Group’s financial assets and liabilities exposed to price risk had increased or decreased by 10% with all other variables held constant, profit before income tax for the year would have increased by RMB93,472 million or decreased by RMB90,470 million (as at 31 December 2024: increase by RMB79,887 million or decrease by RMB80,200 million), respectively, mainly due to fair value gains or losses on listed equities and securities investment funds at fair value through profit or loss and the change of insurance contract liabilities. Other comprehensive income before income tax would have increased by RMB18,793 million or decreased by RMB18,804 million (as at 31 December 2024: increase by RMB3,998 million or decrease by RMB3,936 million), respectively, mainly as a result of fair value gains or losses on investment in equity instruments at fair value through other comprehensive income, and the change of insurance contract liabilities. **(iii) Currency risk** Currency risk is the volatility of fair value or future cash flows of financial instruments resulted from changes in foreign currency exchange rates. The Group’s currency risk exposure mainly arises from cash and cash equivalents, term deposits, financial assets at fair value through profit or loss, investment in equity instruments at fair value through other comprehensive income, investment in debt instruments at fair value through other comprehensive income, investment in debt instruments at amortised cost, interest-bearing loans and other borrowings denominated in currencies other than the functional currency, such as US dollar, HK dollar, GB pound and EUR. The following table summarises primary financial assets and financial liabilities denominated in currencies other than RMB as at 31 December 2025 (as at 31 December 2024: same), expressed in RMB equivalent: | As at 31 December 2025 | US dollar | HK dollar | GB pound | EUR | Others | Total | | :--- | :---: | :---: | :---: | :---: | :---: | :---: | | **(RMB million)** | | | | | | | | **Financial assets** | | | | | | | | Financial assets at fair value through profit or loss | 33,009 | 50,761 | 2,559 | 3,223 | 1,487 | 91,039 | | Investment in equity instruments at fair value through other comprehensive income | – | 77,877 | – | – | – | 77,877 | | Investment in debt instruments at fair value through other comprehensive income | 227 | – | – | – | – | 227 | | Investment in debt instruments at amortised cost | 251 | – | – | – | – | 251 | | Term deposits | 3,497 | – | 125 | – | – | 3,622 | | Cash and cash equivalents | 1,631 | 44 | 51 | 57 | 16 | 1,799 | | **Total** | **38,615** | **128,682** | **2,735** | **3,280** | **1,503** | **174,815** | --- # Notes to the Consolidated Financial Statements (continued) For the year ended 31 December 2025 ## 5 RISK MANAGEMENT (continued) ### 5.2 Financial risk (continued) #### 5.2.1 Market risk (continued) **(iii) Currency risk (continued)** | As at 31 December 2024 | US dollar | HK dollar | GB pound | EUR | Others | Total | | :--- | :---: | :---: | :---: | :---: | :---: | :---: | | | | | **RMB million** | | | | | **Financial assets** | | | | | | | | Financial assets at fair value through profit or loss | 32,731 | 38,187 | 811 | 2,275 | 1,486 | 75,490 | | Investment in equity instruments at fair value through other comprehensive income | – | 36,338 | – | – | – | 36,338 | | Investment in debt instruments at fair value through other comprehensive income | 237 | – | – | – | – | 237 | | Investment in debt instruments at amortised cost | 157 | – | – | – | – | 157 | | Term deposits | 3,223 | – | – | – | – | 3,223 | | Cash and cash equivalents | 1,413 | 148 | 43 | 163 | 10 | 1,777 | | **Total** | **37,761** | **74,673** | **854** | **2,438** | **1,496** | **117,222** | | **Financial liabilities** | | | | | | | | Interest-bearing loans and other borrowings | 6,960 | – | 2,576 | 3,222 | – | 12,758 | | **Total** | **6,960** | **–** | **2,576** | **3,222** | **–** | **12,758** | As at 31 December 2025, if RMB had strengthened or weakened by 10% against US dollar, HK dollar, GB pound, EUR and other foreign currencies, with all other variables held constant, profit before income tax for the year would have been RMB9,694 million (as at 31 December 2024: RMB6,813 million) lower or higher, respectively, mainly as a result of foreign exchange losses or gains on translation of US dollar, HK dollar, GB pound, EUR and other foreign currencies denominated financial assets and financial liabilities other than equity instruments at fair value through other comprehensive income included in the table above. Other comprehensive income before tax recognised in equity instruments at fair value through other comprehensive income would have been RMB7,788 million (as at 31 December 2024: RMB3,634 million) lower or higher due to the foreign exchange. The actual exchange losses in 2025 were RMB340 million (2024: exchange losses in RMB25 million). ### 5.2.2 Credit risk **Credit risk** is the risk that one party of a financial transaction or the issuer of a financial instrument will fail to discharge its obligation and cause another party to incur a financial loss. Because the Group’s investment portfolio is restricted to the types of investments as permitted by the National Financial Regulatory Administration (“NFRA”) and a significant portion of the portfolio is in government bonds, government agency bonds, corporate bonds with higher credit rating and term deposits with the state-owned commercial banks, the Group’s overall exposure to credit risk is relatively low. Credit risk is controlled by the application of credit approvals, limits and monitoring procedures. The Group manages credit risk through in-house research and analysis of the Chinese economy and the underlying obligors and transaction structures. Where appropriate, the Group obtains collateral in the form of rights to cash, securities, property and equipment to lower the credit risk. --- # Notes to the Consolidated Financial Statements (continued) For the year ended 31 December 2025 ## 5 RISK MANAGEMENT (continued) ### 5.2 Financial risk (continued) #### 5.2.2 Credit risk (continued) **Credit risk exposure** The carrying amount of financial assets included on the consolidated statement of financial position represents the maximum credit risk exposure at the reporting date without taking account of any collateral held or other credit enhancements attached. The Group had no credit risk exposure relating to off-statement financial position items as at 31 December 2025 and 31 December 2024. **Collateral and other credit enhancements** Financial assets purchased under agreements to resell are pledged by counterparties' debt securities or term deposits of which the Group could take the ownership if the owner of the collateral defaults. These structured entities that the Group has interest in are guaranteed by third parties with higher credit ratings, or by pledging, or by having the fiscal budget income as the source of repayment, or by borrowers with higher credit ratings. **Measurement of ECL** The Group formulates the credit losses of financial assets at amortised cost, investments in debt financial instruments at fair value through other comprehensive income, using expected credit loss models according to IFRS 9 requirements. **Parameters for measuring expected credit losses** The parameters and assumptions involved in ECL model are described below: The Group considers the credit risk characteristics of different financial instruments when determining if there is significant increase in credit risk. For financial instruments with or without significant increase in credit risk, 12-month or lifetime expected credit losses are provided respectively. The expected credit loss is the result of discounting the product of EAD, PD and LGD. **Exposure at Default ("EAD"):** EAD is based on the amounts the Group expects to be owed at the time of default, over the next 12 months or over the remaining lifetime. **Probability of Default ("PD"):** The PD represents the likelihood of a borrower defaulting on its financial obligation, either over the next 12 months (12M PD), or over the remaining lifetime (Lifetime PD) of the obligation. **Loss Given Default ("LGD"):** LGD represents the Group's expectation of the extent of loss on a defaulted exposure. LGD varies by type of counterparty, type and seniority of claim and availability of collateral or other credit support. **Criteria for judging significant changes in credit risk** When considering the impairment stages for financial assets, the Group evaluates the credit risk at initial recognition and whether there is any significant increase in credit risk for each reporting period. The Group considers various reasonable supporting information to judge if there is significant increase in credit risk, including the forward-looking information. The Group sets quantitative and qualitative criteria to judge whether the credit risk has significant increase in credit risk after initial recognition. The judgement criteria mainly include the PD changes of the debtors, changes of credit risk categories and other indicators of significant increase in credit risk, etc. In the judgement of whether the financial instruments have significant increase in credit risk after initial recognition, the Group considers the 30 days past due as one of criteria of significant increase in credit risk, in accordance with the standard. --- # Notes to the Consolidated Financial Statements (continued) For the year ended 31 December 2025 ## 5 RISK MANAGEMENT (continued) ### 5.2 Financial risk (continued) #### 5.2.2 Credit risk (continued) **Measurement of ECL (continued)** **Definition of financial assets that are credit-impaired** A financial asset is credit-impaired when one or more events that have a detrimental impact on the estimated future cash flows of that financial asset have occurred. On each reporting date, the Group mainly considers but is not limited to the following factors when assessing whether the debtor has incurred credit impairment: - Significant financial difficulty of the issuer or counterparty; or - A breach of contract, such as a default or past due event; or - The lender gives the borrower concessions for economic or contractual reasons due to the debtor financial difficulties, where such concessions are normally reluctant to be made by the borrower; or - It becoming probable that the borrower will enter bankruptcy or financial re-organisation; or - Disappearance of an active market for that financial asset because of financial difficulties; or - Purchase or originate a financial asset at a significant discount that reflects the fact that a credit loss has occurred. The credit impairment of financial assets may be caused by the joint effects of multiple events, and may not be caused by separately identifiable events. **Forward-looking information and management overlay** The determinations of 12 months and the lifetime ECL also incorporates forward-looking information. The Group has performed historical data analysis and identified the key macroeconomic variables associated with credit risk and expected credit losses for each portfolio, including gross domestic product, the amount of exports and the amount of fixed asset investment completed, etc. The Group has developed macroeconomic forward-looking adjustment model by establishing a pool of macro-economic indicators, preparing data, filtering model factors, etc. During the reporting period, the Group adjusted the predicted values of forward-looking economic indicators by synthesis of available data and considered the possibility of each scenario to determine the final macroeconomic scenarios and weights for measuring the relevant expected credit loss. The impact of these economic indicators on PD and LGD varies to different businesses. The Group comprehensively considers internal and external data, statistical analysis to determine the relationship between these economic indicators with PD and LGD. The Group evaluates and forecasts these economic indicators at least annually, provides the best estimates for the future, and regularly evaluates the results. Similar to other economic forecasts, the estimates of economic indicators have high inherent uncertainties, actual results may have significant difference with estimates. The Group considered the estimates above represented the optimal estimation of possible outcomes. In the year 2025, the Group updated the forward-looking parameters used in the measurement of ECL in response to changes in the macroeconomic environment. The cumulative year-on-year growth rate of GDP is expected to range between 3.75% to 5.15% (2024: 3.90%-5.00%) under the base, optimistic, and adverse scenarios for 2025. Within the scenario weighting framework, equal weights are assigned to the optimistic and adverse scenarios, while the base scenario is allocated a moderately higher weighting. --- # Notes to the Consolidated Financial Statements (continued) For the year ended 31 December 2025 ## 5 RISK MANAGEMENT (continued) ### 5.2 Financial risk (continued) #### 5.2.2 Credit risk (continued) **Measurement of ECL (continued)** **Forward-looking information and management overlay (continued)** The following table presents the credit risk exposures of financial instruments under the scope of expected credit loss. | As at 31 December 2025 | Stage 1 (RMB million) | Stage 2 (RMB million) | Stage 3 (RMB million) | Maximum credit risk exposure (RMB million) | | :--- | :---: | :---: | :---: | :---: | | **Carrying amount** | | | | | | Cash and cash equivalents | 142,373 | – | – | 142,373 | | Financial assets purchased under agreements to resell | 50,879 | – | – | 50,879 | | Term deposits | 418,688 | – | – | 418,688 | | Statutory deposits – restricted | 6,620 | – | – | 6,620 | | Investment in debt instruments at amortised cost | 173,502 | 490 | – | 173,992 | | Investment in debt instruments at fair value through other comprehensive income | 3,922,187 | 3,855 | – | 3,926,042 | | Other assets | 16,264 | – | 305 | 16,569 | | **Total** | **4,730,513** | **4,345** | **305** | **4,735,163** | | As at 31 December 2024 | Stage 1 (RMB million) | Stage 2 (RMB million) | Stage 3 (RMB million) | Maximum credit risk exposure (RMB million) | | :--- | :---: | :---: | :---: | :---: | | **Carrying amount** | | | | | | Cash and cash equivalents | 85,505 | – | – | 85,505 | | Financial assets purchased under agreements to resell | 30,560 | – | – | 30,560 | | Term deposits | 438,455 | – | – | 438,455 | | Statutory deposits – restricted | 6,591 | – | – | 6,591 | | Investment in debt instruments at amortised cost | 196,505 | 249 | – | 196,754 | | Investment in debt instruments at fair value through other comprehensive income | 3,457,022 | 1,873 | – | 3,458,895 | | Other assets | 14,568 | – | 51 | 14,619 | | **Total** | **4,229,206** | **2,122** | **51** | **4,231,379** | The Group internally grades the financial instruments based on the credit quality and risk characteristics. The credit rating of the financial instruments could further be classified into the different levels according to the internal rating scale. As at 31 December 2025, the debt investments held by the Group have sufficient evidence to show that the asset is not expected to default, or there is no reason to suspect that the asset had incurred default. The related credit risk has not caused a material impact on the Group's consolidated financial statements as at 31 December 2025. --- # Notes to the Consolidated Financial Statements (continued) For the year ended 31 December 2025 ## 5 RISK MANAGEMENT (continued) ### 5.2 Financial risk (continued) #### 5.2.2 Credit risk (continued) **Measurement of ECL (continued)** The following tables present the changes in the gross carrying amount and impairment provision of the main financial assets. **2025** **RMB million** | Gross carrying amount | Stage of impairment | 1 January | Net increase/ (decrease)(i) | Transfer into/ (out) Stage 1 and Stage 2 | Transfer into/ (out) Stage 1 and Stage 3 | Transfer into/ (out) Stage 2 and Stage 3 | Write-offs | 31 December | | :--- | :--- | :--- | :--- | :--- | :--- | :--- | :--- | :--- | | Investment in debt instruments at amortised cost | Stage 1 | 196,990 | (22,747) | (253) | — | — | — | 173,990 | | | Stage 2 | 250 | (1) | 253 | — | — | — | 502 | | | Stage 3 | — | — | — | — | — | — | — | | | **Subtotal** | **197,240** | **(22,748)** | **—** | **—** | **—** | **—** | **174,492** | | Investment in debt instruments at fair value through other comprehensive income | Stage 1 | 3,457,022 | 468,063 | (2,898) | — | — | — | 3,922,187 | | | Stage 2 | 1,873 | (916) | 2,898 | — | — | — | 3,855 | | | Stage 3 | — | — | — | — | — | — | — | | | **Subtotal** | **3,458,895** | **467,147** | **—** | **—** | **—** | **—** | **3,926,042** | | **Total** | | **3,656,135** | **444,399** | **—** | **—** | **—** | **—** | **4,100,534** | (i): Changes in current year due to purchase, purchased credit-impaired or derecognition except write-offs. --- **2025** **RMB million** | Impairment provision | Stage of impairment | 1 January | Net increase/ (decrease)(i) | Transfer into/ (out) Stage 1 and Stage 2 | Transfer into/ (out) Stage 1 and Stage 3 | Transfer into/ (out) Stage 2 and Stage 3 | Write-offs | 31 December | | :--- | :--- | :--- | :--- | :--- | :--- | :--- | :--- | :--- | | Investment in debt instruments at amortised cost | Stage 1 | 485 | 4 | (1) | — | — | — | 488 | | | Stage 2 | 1 | 10 | 1 | — | — | — | 12 | | | Stage 3 | — | — | — | — | — | — | — | | | **Subtotal** | **486** | **14** | **—** | **—** | **—** | **—** | **500** | | Investment in debt instruments at fair value through other comprehensive income | Stage 1 | 832 | 78 | (16) | — | — | — | 894 | | | Stage 2 | 96 | 14 | 16 | — | — | — | 126 | | | Stage 3 | — | — | — | — | — | — | — | | | **Subtotal** | **928** | **92** | **—** | **—** | **—** | **—** | **1,020** | | **Total** | | **1,414** | **106** | **—** | **—** | **—** | **—** | **1,520** | (i): Changes in current year due to purchase, purchased credit-impaired or derecognition except write-offs. --- # Notes to the Consolidated Financial Statements (continued) For the year ended 31 December 2025 ## 5 RISK MANAGEMENT (continued) ### 5.2 Financial risk (continued) #### 5.2.2 Credit risk (continued) **Measurement of ECL (continued)** The following tables present the changes in the gross carrying amount and impairment provision of the main financial assets (Continued). #### Gross carrying amount - 2024 (RMB million) | Gross carrying amount | Stage of impairment | 1 January | Net increase/ (decrease) (i) | Stages transfers: Transfer into/ (out) Stage 1 and Stage 2 | Stages transfers: Transfer into/ (out) Stage 1 and Stage 3 | Stages transfers: Transfer into/ (out) Stage 2 and Stage 3 | Write-offs | 31 December | | :--- | :--- | :--- | :--- | :--- | :--- | :--- | :--- | :--- | | **Investment in debt instruments at amortised cost** | Stage 1 | 211,699 | (14,459) | (250) | - | - | - | 196,990 | | | Stage 2 | - | - | 250 | - | - | - | 250 | | | Stage 3 | - | - | - | - | - | - | - | | | **Subtotal** | **211,699** | **(14,459)** | **-** | **-** | **-** | **-** | **197,240** | | **Investment in debt instruments at fair value through other comprehensive income** | Stage 1 | 2,735,577 | 714,649 | 6,796 | - | - | - | 3,457,022 | | | Stage 2 | 8,592 | 77 | (6,796) | - | - | - | 1,873 | | | Stage 3 | - | - | - | - | - | - | - | | | **Subtotal** | **2,744,169** | **714,726** | **-** | **-** | **-** | **-** | **3,458,895** | | **Total** | | **2,955,868** | **700,267** | **-** | **-** | **-** | **-** | **3,656,135** | (i) Changes in current year due to purchase, purchased credit-impaired or derecognition except write-offs. #### Impairment provision - 2024 (RMB million) | Impairment provision | Stage of impairment | 1 January | Net increase/ (decrease) (i) | Stages transfers: Transfer into/ (out) Stage 1 and Stage 2 | Stages transfers: Transfer into/ (out) Stage 1 and Stage 3 | Stages transfers: Transfer into/ (out) Stage 2 and Stage 3 | Write-offs | 31 December | | :--- | :--- | :--- | :--- | :--- | :--- | :--- | :--- | :--- | | **Investment in debt instruments at amortised cost** | Stage 1 | 350 | 136 | (1) | - | - | - | 485 | | | Stage 2 | - | - | 1 | - | - | - | 1 | | | Stage 3 | - | - | - | - | - | - | - | | | **Subtotal** | **350** | **136** | **-** | **-** | **-** | **-** | **486** | | **Investment in debt instruments at fair value through other comprehensive income** | Stage 1 | 750 | (282) | 364 | - | - | - | 832 | | | Stage 2 | 446 | 14 | (364) | - | - | - | 96 | | | Stage 3 | 236 | (236) | - | - | - | - | - | | | **Subtotal** | **1,432** | **(504)** | **-** | **-** | **-** | **-** | **928** | | **Total** | | **1,782** | **(368)** | **-** | **-** | **-** | **-** | **1,414** | (i) Changes in current year due to purchase, purchased credit-impaired or derecognition except write-offs. --- # Notes to the Consolidated Financial Statements (continued) For the year ended 31 December 2025 ## 5 RISK MANAGEMENT (continued) ### 5.2 Financial risk (continued) #### 5.2.2 Credit risk (continued) **Credit quality** The Group’s financial assets facing credit risk mainly include government bonds, government agency bonds, corporate bonds and subordinated bonds, etc. As at 31 December 2025, 99.5% (as at 31 December 2024: 99.1%) of the corporate bonds held by the Group or the issuers of these corporate bonds had credit ratings of AA/A-2 or above. As at 31 December 2025, 100.0% (as at 31 December 2024: 100.0%) of the subordinated bonds held by the Group either had credit ratings of AA/A-2 or above, or were issued by national commercial banks. The bonds issuers’ credit ratings are assigned by a qualified appraisal institution in the PRC and updated at each reporting date. As at 31 December 2025, 97.3% (as at 31 December 2024: 97.8%) of the Group’s bank deposits are with the four largest state-owned commercial banks, other national commercial banks and China Securities Depository and Clearing Corporation Limited (“CSDCC”) in the PRC. The main reinsurance contracts were entered into with state-owned reinsurance companies. The Group believes these commercial banks, CSDCC and reinsurance companies have a high credit quality. As a result, the Group concludes that the credit risk associated with term deposits, statutory deposits, cash and cash equivalents and reinsurance contracts held has not caused a material impact on the Group’s consolidated financial statements as at 31 December 2025 (as at 31 December 2024: same). #### 5.2.3 Liquidity risk Liquidity risk is the risk that the Group is unable to obtain funds at a reasonable funding cost when required to meet a repayment obligation and fund its asset portfolio within a certain time. In the normal course of business, the Group attempts to match the maturity of financial assets to the maturity of insurance and financial liabilities to reduce liquidity risk. --- # Notes to the Consolidated Financial Statements (continued) For the year ended 31 December 2025 ## 5 RISK MANAGEMENT (continued) ### 5.2 Financial risk (continued) #### 5.2.3 Liquidity risk (continued) The following table shows the undiscounted cash flows of financial assets and financial liabilities, insurance assets and insurance liabilities for contracts not using the premium allocation approach: | As at 31 December 2025 (RMB million) | Without maturity | Not later than 1 year | Later than 1 year but not later than 3 years | Later than 3 years but not later than 5 years | Later than 5 years | | :--- | :---: | :---: | :---: | :---: | :---: | | **Financial and insurance assets** | | | | | | | Financial assets at fair value through profit or loss | 1,209,222 | 125,195 | 249,829 | 153,977 | 592,465 | | Investment in debt instruments at amortised cost | – | 27,359 | 86,632 | 78,712 | 30,486 | | Investment in debt instruments at fair value through other comprehensive income | – | 365,591 | 442,359 | 316,336 | 4,491,791 | | Investment in equity instruments at fair value through other comprehensive income | 317,876 | – | – | – | – | | Term deposits | – | 71,164 | 197,203 | 179,384 | – | | Statutory deposits – restricted | – | 552 | 5,998 | 508 | – | | Reinsurance contract assets | – | 6,395 | 2,935 | 2,709 | 34,838 | | Financial assets purchased under agreements to resell | – | 50,879 | – | – | – | | Cash and cash equivalents | – | 142,407 | – | – | – | | **Sub-total** | **1,527,098** | **789,542** | **984,956** | **731,626** | **5,149,580** | | **Financial and insurance liabilities** | | | | | | | Insurance contract liabilities | – | 311,631 | (195,398) | (509,499) | (9,241,515) | | Reinsurance contract liabilities | – | (230) | (186) | (175) | (605) | | Financial assets sold under agreements to repurchase | – | (331,863) | – | – | – | | Financial liabilities at fair value through profit or loss | (82,010) | – | – | – | – | | Interest-bearing loans and other borrowings | – | (6) | (52) | – | – | | Bonds payable | – | (753) | (1,505) | (35,753) | – | | Lease liabilities | – | (777) | (695) | (135) | (19) | | **Sub-total** | **(82,010)** | **(21,998)** | **(197,836)** | **(545,562)** | **(9,242,139)** | | **Net cash inflow/(outflow)** | **1,445,088** | **767,544** | **787,120** | **186,064** | **(4,092,559)** | --- # Notes to the Consolidated Financial Statements (continued) For the year ended 31 December 2025 ## 5 RISK MANAGEMENT (continued) ### 5.2 Financial risk (continued) ### 5.2.3 Liquidity risk (continued) | Contractual and expected cash flows (undiscounted) | Without maturity | Not later than 1 year | Later than 1 year but not later than 3 years | Later than 3 years but not later than 5 years | Later than 5 years | | :--- | :---: | :---: | :---: | :---: | :---: | | **As at 31 December 2024** | **RMB million** | **RMB million** | **RMB million** | **RMB million** | **RMB million** | | **Financial and insurance assets** | | | | | | | Financial assets at fair value through profit or loss | 954,938 | 182,734 | 258,146 | 161,557 | 563,771 | | Investment in debt instruments at amortised cost | – | 45,123 | 98,270 | 60,139 | 51,323 | | Investment in debt instruments at fair value through other comprehensive income | – | 276,528 | 480,528 | 297,260 | 3,714,798 | | Investment in equity instruments at fair value through other comprehensive income | 171,817 | – | – | – | – | | Term deposits | – | 98,921 | 220,790 | 158,031 | 6,513 | | Statutory deposits – restricted | – | 483 | 2,566 | 4,202 | – | | Reinsurance contract assets | – | 6,619 | 2,706 | 2,759 | 36,490 | | Financial assets purchased under agreements to resell | – | 30,560 | – | – | – | | Cash and cash equivalents | – | 85,538 | – | – | – | | **Sub-total** | 1,126,755 | 726,506 | 1,063,006 | 683,948 | 4,372,895 | | **Financial and insurance liabilities** | | | | | | | Insurance contract liabilities | – | 333,654 | (116,952) | (400,199) | (8,740,310) | | Reinsurance contract liabilities | – | (33) | (53) | (49) | (304) | | Financial assets sold under agreements to repurchase | – | (151,564) | – | – | – | | Financial liabilities at fair value through profit or loss | (53,521) | – | – | – | – | | Interest-bearing loans and other borrowings | – | (10,054) | (3,348) | – | – | | Bonds payable | – | (753) | (1,505) | (36,307) | – | | Lease liabilities | – | (767) | (679) | (180) | (14) | | **Sub-total** | (53,521) | 170,483 | (122,537) | (436,735) | (8,740,628) | | **Net cash inflow/(outflow)** | 1,073,234 | 896,989 | 940,469 | 247,213 | (4,367,733) | The cash flows from various insurance contracts presented in the table above are the expected future net cash flows from existing insurance policies, which consist primarily of cash flows from premiums, claims, expense payments and policy loans, and do not take into account future net cash flows from new business. The estimate is subject to assumptions including mortality, morbidity, the lapse rate, and expense assumption, etc. Actual experience may differ from estimates. As at 31 December 2025, the carrying amount of the Group’s insurance contract liabilities was RMB6,376,114 million (as at 31 December 2024: RMB5,825,026 million), while the amount that the policyholder can demand reimbursement at any time was RMB4,691,941 million (as at 31 December 2024: RMB4,198,058 million). --- # Notes to the Consolidated Financial Statements (continued) For the year ended 31 December 2025 ## 5 RISK MANAGEMENT (continued) ### 5.2 Financial risk (continued) #### 5.2.4 Capital management The Group’s objectives for managing capital are to comply with the insurance capital requirements based on the minimum capital and actual capital required by the NFRA, prevent risk in operation and safeguard the Group’s ability to continue as a going concern so that it can continue to provide returns for equity holders and benefits for other stakeholders. The Group manages capital to ensure its continuous and full compliance with the regulations mainly through monitoring its quarterly solvency ratios, as well as the solvency ratio based on annual stress testing. The former China Banking and Insurance Regulatory Commission issued the “Solvency Regulatory Rules II for Insurance Companies” at the end of 2021. The NFRA issued the “Circular of NFRA on Optimization of Solvency Supervision Standards for Insurance Companies” in September 2023, and ” the Notice on Adjusting Risk Factors for Relevant Insurance Business ” issued in December 2025. The Company has calculated the core and comprehensive solvency ratio, core capital, actual capital and minimum capital as of 31 December 2025 in accordance with these requirements, as listed below: | | As at 31 December 2025 | As at 31 December 2024 | | :--- | :---: | :---: | | | **RMB million** | **RMB million** | | Core capital | 777,291 | 767,446 | | Actual capital | 1,050,358 | 1,039,821 | | Minimum capital | 603,624 | 500,489 | | Core solvency ratio | 129% | 153% | | Comprehensive solvency ratio | 174% | 208% | According to the solvency ratios results mentioned above, and the unquantifiable evaluation results of operational risk, strategic risk, reputational risk and liquidity risk of insurance companies, the NFRA evaluates the comprehensive solvency of insurance companies and supervises insurance companies by classifying them into four categories: i) Category A: solvency ratios meet the requirements, and the operational risk, strategic risk, reputational risk and liquidity risk are very low; ii) Category B: solvency ratios meet the requirements, and the operational risk, strategic risk, reputational risk and liquidity risk are low; iii) Category C: solvency ratios do not meet the requirements or solvency ratios meet the requirements but one or several risks in operation, strategy, reputation and liquidity are high; iv) Category D: solvency ratios do not meet the requirements or solvency ratios meet the requirements but one or several risks in operation, strategy, reputation and liquidity are severe. According to the Supervision Information System of the China Risk Oriented Solvency System, the latest Integrated Risk Rating result of the Company was Category A. ## 5.3 Disclosures about interest in unconsolidated structured entities The Group’s interests in unconsolidated structured entities are accounted for in investments in financial assets at fair value through profit or loss and debt instruments at fair value through other comprehensive income. These structured entities typically raise funds by issuing securities or other beneficiary certificates. The purpose of these structured entities is primarily to generate management service fees, or provide finance to public and private infrastructure construction. Refer to Note 4.5 for the Group’s consolidation judgements related to structured entities. --- # Notes to the Consolidated Financial Statements (continued) For the year ended 31 December 2025 ## 5 RISK MANAGEMENT (continued) ### 5.3 Disclosures about interest in unconsolidated structured entities (continued) The Group did not guarantee or provide any financing support for the structured entities that the Group had interest in or sponsored. **(i) The unconsolidated structured entities that the Group has interest in** The Group believes that the maximum exposure approximates the carrying amount of interest in these unconsolidated structured entities. The size of unconsolidated structured entities as well as the Group’s carrying amount of the assets recognised in the consolidated financial statements relating to its interest in unconsolidated structured entities and the Group’s maximum exposure are shown below: | As at 31 December 2025 | Unconsolidated structured entities - Size | Unconsolidated structured entities - Carrying amount of assets | Unconsolidated structured entities - Maximum exposure | Interest held by the Group | | :--- | :--- | :--- | :--- | :--- | | **RMB million** | | | | | | Funds managed by affiliated entities | 168,737 | 8,479 | 8,479 | Investment income and service fee | | Funds managed by third parties (i) | (i) | 382,541 | 382,541 | Investment income | | Trust schemes managed by affiliated entities | 600 | 82 | 82 | Investment income | | Trust schemes managed by third parties (i) | (i) | 73,745 | 73,745 | Investment income | | Debt investment schemes managed by affiliated entities | 83,741 | 37,600 | 37,600 | Investment income and service fee | | Debt investment schemes managed by third parties (i) | (i) | 34,611 | 34,611 | Investment income | | Others managed by affiliated entities (ii) | 33,382 | 30,783 | 30,783 | Investment income and service fee | | Others managed by third parties (ii) | (i) | 91,289 | 91,289 | Investment income | | As at 31 December 2024 | Unconsolidated structured entities - Size | Unconsolidated structured entities - Carrying amount of assets | Unconsolidated structured entities - Maximum exposure | Interest held by the Group | | :--- | :--- | :--- | :--- | :--- | | **RMB million** | | | | | | Funds managed by affiliated entities | 231,395 | 8,366 | 8,366 | Investment income and service fee | | Funds managed by third parties (i) | (i) | 274,550 | 274,550 | Investment income | | Trust schemes managed by affiliated entities | 600 | 467 | 467 | Investment income | | Trust schemes managed by third parties (i) | (i) | 93,512 | 93,512 | Investment income | | Debt investment schemes managed by affiliated entities | 81,387 | 38,593 | 38,593 | Investment income and service fee | | Debt investment schemes managed by third parties (i) | (i) | 45,303 | 45,303 | Investment income | | Others managed by affiliated entities (ii) | 71,965 | 26,540 | 26,540 | Investment income and service fee | | Others managed by third parties (ii) | (i) | 158,411 | 158,411 | Investment income | **(i)**: Funds, trust schemes, debt investment schemes and others managed by third parties were sponsored by third party financial institutions and the information related to size of these structured entities were not publicly available. **(ii)**: Others included wealth management products, special asset management schemes, and asset-backed plans, etc. --- # Notes to the Consolidated Financial Statements (continued) For the year ended 31 December 2025 ## 5 RISK MANAGEMENT (continued) ### 5.3 Disclosures about interest in unconsolidated structured entities (continued) #### (ii) The unconsolidated structured entities that the Group has sponsored but does not have interest in As at 31 December 2025, the size of the unconsolidated structured entities that the Group sponsored but had no interest was RMB809,747 million (as at 31 December 2024: RMB886,017 million), which were mainly funds, special asset management schemes, pension security products and pension products, etc., sponsored by the Group to generate management service fee income. In 2025, the management service fee from these structured entities was RMB1,641 million (2024: RMB1,590 million), which was recorded as other income. The Group did not transfer assets to these structured entities. ### 5.4 Fair value hierarchy Level 1 fair value is usually based on quoted prices (unadjusted) in active markets for identical assets or liabilities that the entity can obtain at the measurement date. Other than Level 1 quoted prices, Level 2 fair value is based on valuation techniques using significant inputs, that are observable for the asset being measured, either directly or indirectly, for substantially the full term of the asset through corroboration with observable market data. Observable inputs generally used to measure the fair value of investments classified as Level 2 include quoted market prices for similar assets in active markets; quoted market prices in markets that are not active for identical or similar assets and other market observable inputs. This level includes the debt investments for which quotations are available from pricing services providers. Fair values provided by pricing services providers are subject to a number of validation procedures by management. These procedures include a review of the valuation models utilised and the results of these models, as well as the recalculation of prices obtained from pricing services at the end of each reporting period. In this instance, the Group’s valuation team may choose to apply an internally developed valuation method to the assets or liabilities being measured based on unobservable main inputs for valuation, determine the key inputs for valuation, and analyse the change of the valuation and report it to management. IF key inputs involved in internal valuation services are not based on observable market data, they reflect assumptions made by management based on judgements and experiences. The assets and liabilities valued by this method are generally classified as Level 3. As at 31 December 2025, financial assets classified as Level 1 accounted for 28.9% of financial assets measured at fair value on a recurring basis. They primarily include certain securities that are traded in an active exchange market or interbank market and open-ended funds with public market price quotations. The Group considers a combination of certain factors to determine whether a market for a financial instrument is active, including the occurrence of trades within the specific period, the respective trading volume, and the degree to which the implied yields for debt securities for observed transactions differs from the Group’s understanding of the current relevant market rates and information. Trading prices from the Chinese interbank market are determined by both trading counterparties and can be observed publicly. The Group adopted this price of the debt securities traded on the Chinese interbank market at the reporting date as their fair market value and classified the investments as Level 1. Open-ended funds also have active markets. Fund companies publish the net asset value of these funds on their websites on each trade date. Investors subscribe for and redeem units of these funds in accordance with the funds’ net asset value published by the fund companies on each trade date. The Group adopted the unadjusted net asset value of the funds at the reporting date as their fair market value and classified the investments as Level 1. As at 31 December 2025, financial assets classified as Level 2 accounted for 61.6% of financial assets measured at fair value on a recurring basis. They primarily include certain investment securities. Valuations of assets classified as Level 2 are generally obtained from third-party valuation service providers for identical or comparable assets, or through the use of valuation methodologies using observable market inputs, or recent quoted market prices. Valuation service providers typically gather, analyse and interpret information related to market transactions and other key valuation model inputs from multiple sources, and through the use of widely-accepted internal valuation models, provide a theoretical quote on various securities. Debt securities are classified as Level 2 when they are valued at recent trading prices from the Chinese interbank market, or prices determined by the valuation service providers based on directly or indirectly observable important inputs and further observable market data related to the assets as a whole. --- # Notes to the Consolidated Financial Statements (continued) For the year ended 31 December 2025 ## 5 RISK MANAGEMENT (continued) ### 5.4 Fair value hierarchy (continued) As at 31 December 2025, financial assets classified as Level 3 accounted for 9.5% of financial assets measured at fair value on a recurring basis. They primarily include unlisted investments. Fair values are determined using valuation techniques, including discounted cash flow valuations and the comparable companies’ approach. The determination of Level 3 is primarily based on the significance of certain unobservable inputs used for measurement of the asset’s fair value. For the accounting policies regarding the determination of fair values of financial assets and liabilities, see Note 4.2. The following table presents the Group’s quantitative disclosures of the fair value measurement hierarchy for assets and liabilities measured at fair value as at 31 December 2025: | (RMB million) | Quoted prices in active markets Level 1 | Significant observable inputs Level 2 | Significant unobservable inputs Level 3 | Total | | :--- | :---: | :---: | :---: | :---: | | **Assets measured at fair value** | | | | | | Investment in debt instruments at fair value through other comprehensive income | | | | | | Government bonds | 443,313 | 188,604 | – | 631,917 | | Government agency bonds | 114,921 | 2,540,224 | – | 2,655,145 | | Corporate bonds | 13,375 | 479,345 | – | 492,720 | | Subordinated bonds | – | 20,462 | – | 20,462 | | Others | – | 7,116 | 118,682 | 125,798 | | Investment in equity instruments at fair value through other comprehensive income | | | | | | Common stocks | 232,447 | – | – | 232,447 | | Preferred stocks | – | – | 48,690 | 48,690 | | Others | 299 | 12,451 | 23,989 | 36,739 | | Financial assets at fair value through profit or loss | | | | | | Funds | 421,842 | – | – | 421,842 | | Common stocks | 591,100 | 11,795 | – | 602,895 | | Government bonds | 472 | 4,535 | – | 5,007 | | Government agency bonds | 142 | 8,003 | – | 8,145 | | Corporate bonds | 4,873 | 105,512 | 45 | 110,430 | | Subordinated bonds | 51 | 330,235 | – | 330,286 | | Others | 2,927 | 176,001 | 409,755 | 588,683 | | **Total Assets** | **1,825,762** | **3,884,283** | **601,161** | **6,311,206** | | **Liabilities measured at fair value** | | | | | | Financial liabilities at fair value through profit or loss | (82,010) | – | – | (82,010) | | **Total Liabilities** | **(82,010)** | **–** | **–** | **(82,010)** | --- # Notes to the Consolidated Financial Statements (continued) For the year ended 31 December 2025 ## 5 RISK MANAGEMENT (continued) ### 5.4 Fair value hierarchy (continued) The following table presents the changes in Level 3 financial instruments for the year ended 31 December 2025: | | Investment in debt instruments at fair value through other comprehensive income | Investment in equity instruments at fair value through other comprehensive income | Financial assets at fair value through profit or loss | Total | | :--- | :---: | :---: | :---: | :---: | | **RMB million** | | | | | | **Opening balance** | 120,532 | 86,246 | 430,005 | 636,783 | | Purchases | 16,622 | – | 39,589 | 56,211 | | Transferred out of Level 3 | – | – | (37) | (37) | | Total gains/(losses) recorded in profit or loss | (15) | – | (20,648) | (20,663) | | Total gains/(losses) recorded in other comprehensive income | (2,703) | (2,222) | – | (4,925) | | Disposals/Settlement | (15,754) | (11,345) | (39,109) | (66,208) | | **Closing balance** | **118,682** | **72,679** | **409,800** | **601,161** | --- # Notes to the Consolidated Financial Statements (continued) For the year ended 31 December 2025 ## 5 RISK MANAGEMENT (continued) ### 5.4 Fair value hierarchy (continued) The following table presents the Group’s quantitative disclosures of the fair value measurement hierarchy for assets and liabilities measured at fair value as at 31 December 2024: | RMB million | Quoted prices in active markets Level 1 | Significant observable inputs Level 2 | Significant unobservable inputs Level 3 | Total | | :--- | :---: | :---: | :---: | :---: | | **Assets measured at fair value** | | | | | | Investment in debt instruments at fair value through other comprehensive income | | | | | | Government bonds | 455,156 | 233,599 | – | 688,755 | | Government agency bonds | 204,114 | 1,975,710 | – | 2,179,824 | | Corporate bonds | 14,240 | 431,981 | – | 446,221 | | Subordinated bonds/debts | 830 | 20,399 | – | 21,229 | | Others | – | 2,334 | 120,532 | 122,866 | | Investment in equity instruments at fair value through other comprehensive income | | | | | | Common stocks | 60,153 | – | – | 60,153 | | Preferred stocks | – | – | 51,444 | 51,444 | | Others | 17,948 | 7,470 | 34,802 | 60,220 | | Financial assets at fair value through profit or loss | | | | | | Funds | 306,351 | 200 | – | 306,551 | | Common stocks | 440,417 | 513 | – | 440,930 | | Government bonds | 563 | 3,342 | – | 3,905 | | Government agency bonds | 459 | 8,390 | – | 8,849 | | Corporate bonds | 4,215 | 198,663 | 45 | 202,923 | | Subordinated bonds | 155,498 | 192,106 | – | 347,604 | | Others | 53,853 | 113,523 | 429,960 | 597,336 | | **Total** | **1,713,797** | **3,188,230** | **636,783** | **5,538,810** | | **Liabilities measured at fair value** | | | | | | Financial liabilities at fair value through profit or loss | (53,521) | – | – | (53,521) | | **Total** | **(53,521)** | **–** | **–** | **(53,521)** | --- # Notes to the Consolidated Financial Statements (continued) For the year ended 31 December 2025 ## 5 RISK MANAGEMENT (continued) ### 5.4 Fair value hierarchy (continued) The following table presents the changes in Level 3 financial instruments for the year ended 31 December 2024: | | Investment in debt instruments at fair value through other comprehensive income | Investment in equity instruments at fair value through other comprehensive income | Financial assets at fair value through profit or loss | Total | | :--- | :--- | :--- | :--- | :--- | | | **RMB million** | **RMB million** | **RMB million** | **RMB million** | | **Opening balance** | 97,437 | 80,062 | 429,506 | 607,005 | | Purchases | 30,428 | 4,000 | 45,310 | 79,738 | | Total gains/(losses) recorded in profit or loss | (4) | – | 9,428 | 9,424 | | Total gains/(losses) recorded in other comprehensive income | 3,314 | 2,184 | – | 5,498 | | Disposals/Settlement | (10,643) | – | (54,239) | (64,882) | | **Closing balance** | 120,532 | 86,246 | 430,005 | 636,783 | For the assets and liabilities measured at fair value on a recurring basis, during the year ended 31 December 2025, RMB315,973 million (2024: RMB108,990 million) investments were transferred from Level 1 to Level 2 within the fair value hierarchy, whereas RMB100,442 million (2024: RMB122,581 million) investments were transferred from Level 2 to Level 1. As at 31 December 2025, significant unobservable inputs such as discount rate and discounts for lack of marketability were used in the valuation of primary assets and liabilities at fair value classified as Level 3 (as at 31 December 2024: same). The table below presents information about the significant unobservable inputs used for primary financial instruments at fair value classified as Level 3 as at 31 December 2025 (as at 31 December 2024: same): | Valuation techniques | Significant unobservable inputs | Range | Relationships between fair value and unobservable inputs | | :--- | :--- | :--- | :--- | | Comparable companies method | Discounts for lack of marketability | As at 31 December 2025: 14%-33%
As at 31 December 2024: 13%-35% | The fair value is inversely related to the discounts for lack of marketability | | Discounted cash flow method | Discount rate | As at 31 December 2025: 1.64%-16.82%
As at 31 December 2024: 1.62%-13.00% | The fair value is inversely related to discount rate | --- # Notes to the Consolidated Financial Statements (continued) For the year ended 31 December 2025 ## 6 SEGMENT INFORMATION ### 6.1 Operating segments **(i) Life insurance business ("Life")** Life insurance business relates primarily to the sale of life insurance policies, including those life insurance policies without significant insurance risk transferred. **(ii) Health insurance business and Accident insurance business ("Health & Accident")** Health insurance business relates primarily to the sale of health insurance policies, including those health insurance policies without significant insurance risk transferred. Accident insurance business relates primarily to the sale of accident insurance policies. To better reflect the operating results and business development, the Group has combined the health insurance business and accident insurance business as a single reportable segment based on the significance criteria determined by reportable segment, and the comparative information has been restated accordingly. **(iii) Other businesses ("Others")** Other businesses relate primarily to income and cost of the agency business in respect of transactions with CLIC, etc., as described in Note 31, and the income and expenses of subsidiaries, as well as related consolidation eliminations, etc. ### 6.2 Allocation basis of income and expenses Insurance service income and expenses directly related to the segments are directly recognised in each insurance segment. Interest income, investment income etc., are allocated to each segment by systematic and reasonable method. Other expenses that are not directly attributable to the portfolio of insurance contracts are not allocated and are directly recognised in other business segment. ### 6.3 Allocation basis of assets and liabilities Insurance service assets and liabilities directly related to the segments are directly recognised in each insurance segment. Other assets and other liabilities are allocated to each segment by systematic and reasonable method. ### 6.4 The Group’s external transaction income and assets are predominantly sourced from China (including Hong Kong). Due to the dispersion of the policyholders in life insurance business, the Group maintains minimal reliance on any single policyholder. --- # Notes to the Consolidated Financial Statements (continued) For the year ended 31 December 2025 ## 6 SEGMENT INFORMATION (continued) ### For the year ended 31 December 2025 | | Life | Health & Accident | Others | Total | | :--- | :--- | :--- | :--- | :--- | | | **RMB million** | **RMB million** | **RMB million** | **RMB million** | | Insurance revenue | 144,052 | 70,084 | – | 214,136 | | Interest income | 116,868 | 7,786 | 3,632 | 128,286 | | Investment income | 235,773 | 15,709 | 3,929 | 255,411 | | Investment income from associates and joint ventures | 8,853 | 590 | (3,090) | 6,353 | | Other income | – | – | 11,879 | 11,879 | | **Total revenues** | **505,546** | **94,169** | **16,350** | **616,065** | | Insurance service expenses | (88,470) | (60,266) | – | (148,736) | | Allocation of reinsurance premiums paid | (990) | (4,760) | – | (5,750) | | Less: Amounts recovered from reinsurers | 390 | 4,858 | – | 5,248 | | Insurance finance income/(expenses) from insurance contracts issued | (245,117) | (13,741) | – | (258,858) | | Less: Reinsurance finance income/(expenses) from reinsurance contracts held | 130 | 525 | – | 655 | | Finance costs | (3,494) | (232) | (432) | (4,158) | | Expected credit losses | (1,558) | (104) | 1,511 | (151) | | Other impairment losses | (5,925) | (394) | 3,044 | (3,275) | | Other expenses | – | – | (19,411) | (19,411) | | **Profit before income tax** | **160,512** | **20,055** | **1,062** | **181,629** | | **Supplementary Information:** | | | | | | Depreciation and amortisation expenses | 2,484 | 1,692 | 716 | 4,892 | ### For the year ended 31 December 2025 | Segment information | Life | Health & Accident | Others | Total | | :--- | :--- | :--- | :--- | :--- | | | **RMB million** | **RMB million** | **RMB million** | **RMB million** | | **Segment assets** | 6,910,526 | 484,035 | 196,443 | 7,591,004 | | **Segment liabilities** | 6,387,561 | 419,530 | 175,520 | 6,982,611 | --- # Notes to the Consolidated Financial Statements (continued) For the year ended 31 December 2025 ## 6 SEGMENT INFORMATION (continued) | | For the year ended 31 December 2024 | | | | | :--- | :---: | :---: | :---: | :---: | | | **Life** | **Health & Accident** | **Others** | **Total** | | | **RMB million** | **RMB million** | **RMB million** | **RMB million** | | Insurance revenue | 137,405 | 70,756 | — | 208,161 | | Interest income | 109,156 | 7,384 | 4,418 | 120,958 | | Investment income | 159,176 | 10,770 | 6,515 | 176,461 | | Investment income from associates and joint ventures | 10,647 | 720 | 710 | 12,077 | | Other income | — | — | 10,970 | 10,970 | | **Total revenues** | **416,384** | **89,630** | **22,613** | **528,627** | | Insurance service expenses | (119,797) | (60,747) | — | (180,544) | | Allocation of reinsurance premiums paid | (958) | (4,113) | — | (5,071) | | Less: Amounts recovered from reinsurers | 390 | 5,059 | — | 5,449 | | Insurance finance income/(expenses) from insurance contracts issued | (197,269) | (12,683) | — | (209,952) | | Less: Reinsurance finance income/(expenses) from reinsurance contracts held | 126 | 545 | — | 671 | | Finance costs | (2,935) | (199) | (1,066) | (4,200) | | Expected credit losses | (3,446) | (234) | 3,887 | 207 | | Other impairment losses | (2,585) | (175) | 1,149 | (1,611) | | Other expenses | — | — | (18,363) | (18,363) | | **Profit before income tax** | **89,910** | **17,083** | **8,220** | **115,213** | | **Supplementary Information:** | | | | | | Depreciation and amortisation expenses | 2,843 | 1,441 | 745 | 5,029 |
| | For the year ended 31 December 2024 | | | | | :--- | :---: | :---: | :---: | :---: | | **Segment information** | **Life** | **Health & Accident** | **Others** | **Total** | | | **RMB million** | **RMB million** | **RMB million** | **RMB million** | | **Segment assets** | 6,125,372 | 438,790 | 205,384 | 6,769,546 | | **Segment liabilities** | 5,672,377 | 384,318 | 191,603 | 6,248,298 | --- # Notes to the Consolidated Financial Statements (continued) For the year ended 31 December 2025 ## 7 PROPERTY, PLANT AND EQUIPMENT | | Buildings | Office equipment, furniture and fixtures | Motor vehicles | Assets under construction | Leasehold improvements | Total | | :--- | :---: | :---: | :---: | :---: | :---: | :---: | | **RMB million** | | | | | | | | **Cost** | | | | | | | | As at 1 January 2025 | 65,054 | 10,729 | 1,276 | 5,828 | 2,200 | 85,087 | | Transfers upon completion | 3,524 | 8 | – | (3,684) | 142 | (10) | | Additions | 294 | 347 | 59 | 1,719 | – | 2,419 | | Disposals | (128) | (155) | (81) | – | (88) | (452) | | As at 31 December 2025 | 68,744 | 10,929 | 1,254 | 3,863 | 2,254 | 87,044 | | **Accumulated depreciation** | | | | | | | | As at 1 January 2025 | (20,139) | (8,048) | (1,005) | – | (1,834) | (31,026) | | Charge for the year | (2,267) | (763) | (71) | – | (166) | (3,267) | | Disposals | 51 | 149 | 78 | – | 84 | 362 | | As at 31 December 2025 | (22,355) | (8,662) | (998) | – | (1,916) | (33,931) | | **Impairment** | | | | | | | | As at 1 January 2025 | (22) | – | – | (9) | – | (31) | | Charge for the year | – | – | – | (76) | – | (76) | | Disposals | – | – | – | – | – | – | | As at 31 December 2025 | (22) | – | – | (85) | – | (107) | | **Net book value** | | | | | | | | As at 1 January 2025 | 44,893 | 2,681 | 271 | 5,819 | 366 | 54,030 | | As at 31 December 2025 | 46,367 | 2,267 | 256 | 3,778 | 338 | 53,006 | --- # Notes to the Consolidated Financial Statements (continued) For the year ended 31 December 2025 ## 7 PROPERTY, PLANT AND EQUIPMENT (continued) | RMB million | Buildings | Office equipment, furniture and fixtures | Motor vehicles | Assets under construction | Leasehold improvements | Total | | :--- | :---: | :---: | :---: | :---: | :---: | :---: | | **Cost** | | | | | | | | As at 1 January 2024 | 63,486 | 9,963 | 1,345 | 5,183 | 2,215 | 82,192 | | Transfers upon completion | 1,986 | 31 | — | (2,168) | 147 | (4) | | Additions | 9 | 895 | 89 | 2,813 | — | 3,806 | | Disposals | (427) | (160) | (158) | — | (162) | (907) | | **As at 31 December 2024** | **65,054** | **10,729** | **1,276** | **5,828** | **2,200** | **85,087** | | **Accumulated depreciation** | | | | | | | | As at 1 January 2024 | (18,342) | (7,261) | (1,057) | — | (1,799) | (28,459) | | Charge for the year | (2,152) | (942) | (100) | — | (192) | (3,386) | | Disposals | 355 | 155 | 152 | — | 157 | 819 | | **As at 31 December 2024** | **(20,139)** | **(8,048)** | **(1,005)** | **—** | **(1,834)** | **(31,026)** | | **Impairment** | | | | | | | | As at 1 January 2024 | (22) | — | — | (1) | — | (23) | | Charge for the year | — | — | — | (9) | — | (9) | | Disposals | — | — | — | 1 | — | 1 | | **As at 31 December 2024** | **(22)** | **—** | **—** | **(9)** | **—** | **(31)** | | **Net book value** | | | | | | | | As at 1 January 2024 | 45,122 | 2,702 | 288 | 5,182 | 416 | 53,710 | | **As at 31 December 2024** | **44,893** | **2,681** | **271** | **5,819** | **366** | **54,030** | As at 31 December 2025, the net book value of buildings above which were in process to obtain title certificates was RMB3,953 million (as at 31 December 2024: RMB4,234 million). --- # Notes to the Consolidated Financial Statements (continued) For the year ended 31 December 2025 ## 8 LEASES ### (a) Right-of-use assets | | Buildings | Others | Total | | :--- | :--- | :--- | :--- | | **RMB million** | | | | | **Cost** | | | | | As at 1 January 2025 | 3,321 | 4 | 3,325 | | Additions | 1,335 | – | 1,335 | | Deductions | (1,497) | (3) | (1,500) | | **As at 31 December 2025** | **3,159** | **1** | **3,160** | | **Accumulated depreciation** | | | | | As at 1 January 2025 | (1,765) | (3) | (1,768) | | Charge for the year | (821) | (1) | (822) | | Deductions | 1,205 | 3 | 1,208 | | **As at 31 December 2025** | **(1,381)** | **(1)** | **(1,382)** | | **Impairment** | | | | | As at 1 January 2025 | – | – | – | | **As at 31 December 2025** | **–** | **–** | **–** | | **Net book value** | | | | | As at 1 January 2025 | 1,556 | 1 | 1,557 | | **As at 31 December 2025** | **1,778** | **–** | **1,778** |
| | Buildings | Others | Total | | :--- | :--- | :--- | :--- | | **RMB million** | | | | | **Cost** | | | | | As at 1 January 2024 | 3,570 | 4 | 3,574 | | Additions | 1,122 | 1 | 1,123 | | Deductions | (1,371) | (1) | (1,372) | | **As at 31 December 2024** | **3,321** | **4** | **3,325** | | **Accumulated depreciation** | | | | | As at 1 January 2024 | (2,091) | (3) | (2,094) | | Charge for the year | (899) | (1) | (900) | | Deductions | 1,225 | 1 | 1,226 | | **As at 31 December 2024** | **(1,765)** | **(3)** | **(1,768)** | | **Impairment** | | | | | As at 1 January 2024 | – | – | – | | **As at 31 December 2024** | **–** | **–** | **–** | | **Net book value** | | | | | As at 1 January 2024 | 1,479 | 1 | 1,480 | | **As at 31 December 2024** | **1,556** | **1** | **1,557** | The Group's right-of-use assets include the above assets and land use rights disclosed in Note 13. --- # Notes to the Consolidated Financial Statements (continued) For the year ended 31 December 2025 ## 8 LEASES (continued) **(b) The amounts recognised in profit or loss in relation to leases are as follows** | | As at 31 December 2025 | As at 31 December 2024 | | :--- | :---: | :---: | | | **RMB million** | **RMB million** | | Interest on lease liabilities | 37 | 45 | | Depreciation charge of right-of-use assets | 822 | 900 | | Expense relating to short-term leases | 293 | 288 | | Expense relating to leases of low-value assets (except for short-term lease liabilities) | 2 | 2 | | **Total** | **1,154** | **1,235** | ## 9 INVESTMENT PROPERTIES | | Buildings | | :--- | :---: | | | **RMB million** | | **Cost** | | | As at 1 January 2025 | 15,226 | | Additions | 4 | | Deductions | (28) | | **As at 31 December 2025** | **15,202** | | **Accumulated depreciation** | | | As at 1 January 2025 | (2,907) | | Additions | (443) | | Deductions | – | | **As at 31 December 2025** | **(3,350)** | | **Impairment** | | | As at 1 January 2025 | – | | Additions | (150) | | Deductions | – | | **As at 31 December 2025** | **(150)** | | **Net book value** | | | As at 1 January 2025 | 12,319 | | **As at 31 December 2025** | **11,702** | | **Fair value** | | | As at 1 January 2025 | 16,060 | | **As at 31 December 2025** | **14,345** | --- # Notes to the Consolidated Financial Statements (continued) ## For the year ended 31 December 2025 ## 9 INVESTMENT PROPERTIES (continued) | | Buildings | | :--- | :--- | | | RMB million | | **Cost** | | | As at 1 January 2024 | 15,222 | | Additions | 4 | | Deductions | – | | **As at 31 December 2024** | **15,226** | | **Accumulated depreciation** | | | As at 1 January 2024 | (2,469) | | Additions | (438) | | Deductions | – | | **As at 31 December 2024** | **(2,907)** | | **Net book value** | | | As at 1 January 2024 | 12,753 | | **As at 31 December 2024** | **12,319** | | **Fair value** | | | As at 1 January 2024 | 16,677 | | **As at 31 December 2024** | **16,060** | The Company leases part of its investment properties to its subsidiaries and charges rentals based on the areas occupied by the respective entities. These properties are categorised as property, plant and equipment of the Group in the consolidated statement of financial position. The Group has no restrictions on the use of its investment properties and no contractual obligations to each investment property purchased, constructed or developed or for repairs, maintenance and enhancements. As at 31 December 2025, the Group had no investment properties for which the title certificates were in process to obtain (as at 31 December 2024: nil). The fair value of investment properties of the Group as at 31 December 2025 amounted to RMB14,345 million (as at 31 December 2024: RMB16,060 million), which was estimated by the Group having regards to valuations performed by independent appraisers. The investment properties were classified as Level 3 in the fair value hierarchy. The Group classifies the fair value of its investment properties within Level 3 of the fair value hierarchy. In determining their fair value, the market comparison approach is employed as the valuation technique. This method utilises recent average transaction prices of comparable properties as a baseline, incorporating systematic adjustments for variations factors, including the time and the conditions of sale, the geographical location, age, decoration, floor area, lot size of the property and other factors to derive the fair value of investment properties. Under the above valuation approach, an increase (decrease) in the comprehensive adjustment coefficient will result in changes in the fair value of investment properties. --- # Notes to the Consolidated Financial Statements (continued) For the year ended 31 December 2025 ## 10 INVESTMENTS IN ASSOCIATES AND JOINT VENTURES | | 2025 | 2024 | | :--- | :---: | :---: | | | **RMB million** | **RMB million** | | **Opening balance** | **302,077** | 258,760 | | Change of the cost | 7,290 | 34,175 | | Share of profit or loss | 6,353 | 12,077 | | Dividends declared | (5,134) | (5,328) | | Other equity movements | (720) | 3,995 | | Provision for impairment | (2,078) | (1,602) | | **Closing balance** | **307,788** | 302,077 | ### Movements in the current year (RMB million) | | Accounting method | Investment cost | As at 31 December 2024 | Change of the cost | Share of profit or loss | Dividends declared | Other equity movements | Provision for impairment | As at 31 December 2025 | Percentage of equity interest | Accumulated amount of impairment | | :--- | :--- | :---: | :---: | :---: | :---: | :---: | :---: | :---: | :---: | :---: | :---: | | **Associates** | | | | | | | | | | | | | China Guangfa Bank Co., Ltd. ("CGB") (i) | Equity method | 53,201 | 112,036 | — | 5,114 | (730) | (1,796) | — | 114,624 | 43.686% | — | | COFCO Futures Company Limited ("COFCO Futures") | Equity method | 1,339 | 2,100 | — | 71 | (37) | 9 | — | 2,143 | 29.58% | — | | China Pipe Group Sichuan to East China Gas Pipeline Co., Ltd. ("Pipeline Company") | Equity method | 10,000 | 11,840 | — | 716 | (660) | (15) | — | 11,881 | 43.86% | — | | China United Network Communications Limited ("China Unicom") (ii) | Equity method | 21,801 | 23,484 | — | 883 | (553) | 390 | — | 24,204 | 10.20% | — | | Others (iii) | Equity method | 65,266 | 64,649 | (9,395) | (2,134) | (690) | (38) | (800) | 51,592 | | (7,480) | | **Sub-total** | | 151,607 | 214,109 | (9,395) | 4,650 | (2,670) | (1,450) | (800) | 204,444 | | (7,480) | | **Joint ventures** | | | | | | | | | | | | | Joy City Commercial Property Fund L.P. ("Joy City") | Equity method | 6,281 | 5,135 | — | 205 | (43) | — | — | 5,297 | 66.67% | — | | Mapleleaf Century Limited ("MCL") | Equity method | 7,656 | 2,636 | — | (352) | — | (215) | — | 2,069 | 75.00% | — | | Others (iii) | Equity method | 99,868 | 80,197 | 16,685 | 1,850 | (2,421) | 945 | (1,278) | 95,978 | | (2,567) | | **Sub-total** | | 113,805 | 87,968 | 16,685 | 1,703 | (2,464) | 730 | (1,278) | 103,344 | | (2,567) | | **Total** | | 265,412 | 302,077 | 7,290 | 6,353 | (5,134) | (720) | (2,078) | 307,788 | | (10,047) | --- # Notes to the Consolidated Financial Statements (continued) For the year ended 31 December 2025 ## 10 INVESTMENTS IN ASSOCIATES AND JOINT VENTURES (continued) (i) The 2024 final dividend of RMB0.0767 in cash per ordinary share was approved and declared in the Annual General Meeting of CGB on 27 June 2025. The Company received a cash dividend of RMB730 million. (ii) The 2024 final dividend of RMB0.0621 in cash per ordinary share was approved and declared in the Annual General Meeting of China Unicom on 27 May 2025. The Company received a cash dividend of RMB198 million. On 9 October 2025, the shareholders’ meeting of China Unicom approved and declared an interim profit distribution for 2025, involving a cash dividend of RMB0.1112 per share. The Company received total cash dividends of RMB355 million. The share price of China Unicom was RMB5.11 per share as at 31 December 2025. (iii) The Group invested in real estate, industrial logistics assets and other industries through these enterprises. (iv) There is no significant restriction for the Group to dispose of its associates and joint ventures. As at 31 December 2025, the major associates and joint ventures of the Group are as follows: | Name | Place of incorporation | Percentage of equity interest held | | :--- | :--- | :--- | | **Associates** | | | | CGB | PRC | 43.686% | | COFCO Futures | PRC | 29.58% | | Pipeline Company | PRC | 43.86% | | China Unicom | PRC | 10.20% | | **Joint ventures** | | | | Joy City | The British Cayman Islands | 66.67% | | MCL | The British Virgin Islands | 75.00% | As at 31 December 2024, the major associates and joint ventures of the Group are as follows: | Name | Place of incorporation | Percentage of equity interest held | | :--- | :--- | :--- | | **Associates** | | | | CGB | PRC | 43.686% | | COFCO Futures | PRC | 29.58% | | Pipeline Company | PRC | 43.86% | | China Unicom | PRC | 10.03% | | **Joint ventures** | | | | Joy City | The British Cayman Islands | 66.67% | | MCL | The British Virgin Islands | 75.00% | --- # Notes to the Consolidated Financial Statements (continued) For the year ended 31 December 2025 ## 10 INVESTMENTS IN ASSOCIATES AND JOINT VENTURES (continued) The following table illustrates the financial information of the Group’s major associates and joint ventures as at 31 December 2025 and for the year ended 31 December 2025: | RMB million | CGB | COFCO Futures | Pipeline Company | China Unicom | Joy City | MCL | | :--- | :---: | :---: | :---: | :---: | :---: | :---: | | Total assets | 3,731,844 | 30,271 | 21,384 | 671,056 | 9,944 | 24,129 | | Total liabilities | 3,426,796 | 25,370 | 7,431 | 294,555 | 17 | 12,786 | | Total equity | 305,048 | 4,901 | 13,953 | 376,501 | 9,927 | 11,343 | | Total equity attributable to equity holders of the associates and joint ventures | 255,048 | 4,880 | 13,953 | 168,591 | 9,927 | 11,343 | | Total adjustments (i) | 7,334 | 2,365 | 13,135 | 68,703 | (1,982) | (8,584) | | Total equity attributable to equity holders of the associates and joint ventures after adjustments | 262,382 | 7,245 | 27,088 | 237,294 | 7,945 | 2,759 | | Proportion of the Group’s ownership | 43.686% | 29.58% | 43.86% | 10.20% | 66.67% | 75.00% | | Book balance of the investments | 114,624 | 2,143 | 11,881 | 24,204 | 5,297 | 2,069 | | Impairment | – | – | – | – | – | – | | Net carrying value of the investments | 114,624 | 2,143 | 11,881 | 24,204 | 5,297 | 2,069 | | Total revenues | 63,942 | 812 | 4,277 | 400,982 | 299 | 704 | | Net profit/(loss) | 13,021 | 243 | 1,653 | 20,788 | 285 | 68 | | Other comprehensive income | (4,574) | 31 | – | (262) | – | (652) | | **Total comprehensive income** | **8,447** | **274** | **1,653** | **20,526** | **285** | **(584)** | --- # Notes to the Consolidated Financial Statements (continued) For the year ended 31 December 2025 ## 10 INVESTMENTS IN ASSOCIATES AND JOINT VENTURES (continued) The following table illustrates the financial information of the Group’s major associates and joint ventures as at 31 December 2024 and for the year ended 31 December 2024: | RMB million | CGB | COFCO Futures | Pipeline Company | China Unicom | Joy City | MCL | | :--- | :--- | :--- | :--- | :--- | :--- | :--- | | Total assets | 3,644,993 | 26,518 | 21,099 | 672,837 | 9,530 | 24,865 | | Total liabilities | 3,345,982 | 21,787 | 7,261 | 304,048 | 7 | 13,140 | | Total equity | 299,011 | 4,731 | 13,838 | 368,789 | 9,523 | 11,725 | | Total equity attributable to equity holders of the associates and joint ventures | 249,012 | 4,713 | 13,838 | 164,847 | 9,523 | 11,725 | | Total adjustments (i) | 150 | – | 340 | 15,093 | (1,821) | (8,210) | | Total equity attributable to equity holders of the associates and joint ventures after adjustments | 249,162 | 4,713 | 14,178 | 179,940 | 7,702 | 3,515 | | Proportion of the Group’s ownership | 43.686% | 29.58% | 43.86% | 10.03% | 66.67% | 75.00% | | Book balance of the investments | 112,036 | 2,100 | 11,840 | 23,484 | 5,135 | 2,636 | | Impairment | – | – | – | – | – | – | | Net carrying value of the investments | 112,036 | 2,100 | 11,840 | 23,484 | 5,135 | 2,636 | | Total revenues | 69,237 | 1,218 | 4,474 | 399,008 | 310 | 769 | | Net profit/(loss) | 15,284 | 265 | 1,860 | 20,601 | 296 | 30 | | Other comprehensive income | 5,520 | 17 | – | 263 | – | 223 | | **Total comprehensive income** | **20,804** | **282** | **1,860** | **20,864** | **296** | **253** | (i) Total adjustments include accounting policy difference adjustments, fair value adjustments and other adjustments. The Group had no contingent liabilities with the associates and joint ventures as at 31 December 2025 (as at 31 December 2024: same). The Group had a capital contribution commitment of RMB15,952 million with associates and joint ventures as at 31 December 2025 (as at 31 December 2024: RMB18,970 million). The capital contribution commitment amount has been included in the capital commitments in Note 36. --- # Notes to the Consolidated Financial Statements (continued) For the year ended 31 December 2025 ## 11 FINANCIAL ASSETS ### 11.1 Term deposits | | As at 31 December 2025 (RMB million) | As at 31 December 2024 (RMB million) | | :--- | :---: | :---: | | **Maturing:** | | | | Within one year | 55,782 | 83,765 | | After one year but within five years | 363,129 | 348,423 | | Over five years | – | 6,500 | | **Sub-total** | **418,911** | **438,688** | | Impairment provision | (223) | (233) | | **Total** | **418,688** | **438,455** | As at 31 December 2025, the Group held RMB1,359 million (as at 31 December 2024: RMB1,104 million) in time deposits that were restricted for specific purposes. ### 11.2 Statutory deposits – restricted | | As at 31 December 2025 (RMB million) | As at 31 December 2024 (RMB million) | | :--- | :---: | :---: | | **Contractual maturity schedule:** | | | | Within one year | 408 | 345 | | After one year but within five years | 6,220 | 6,254 | | **Sub-total** | **6,628** | **6,599** | | Impairment provision | (8) | (8) | | **Total** | **6,620** | **6,591** | Insurance companies in China are required to deposit an amount that equals 20% of their registered capital with banks in compliance with regulations of the NFRA. These funds may not be used for any purpose other than for paying off debts during liquidation proceedings. --- # Notes to the Consolidated Financial Statements (continued) For the year ended 31 December 2025 ## 11 FINANCIAL ASSETS (continued) ### 11.3 Investment in debt instruments at amortised cost | | As at 31 December 2025 | As at 31 December 2024 | | :--- | :--- | :--- | | | **RMB million** | **RMB million** | | Trust schemes | 98,038 | 114,677 | | Debt investment plans | 72,698 | 70,120 | | Others (i) | 3,756 | 12,443 | | **Sub-total** | **174,492** | **197,240** | | Impairment provision | (500) | (486) | | **Total** | **173,992** | **196,754** | | **By place of listing:** | | | | Listed in Mainland, PRC | 617 | 2,081 | | Listed in Hong Kong, PRC | 145 | 99 | | Listed overseas | 106 | 58 | | Unlisted (ii) | 173,124 | 194,516 | | **Total** | **173,992** | **196,754** | (i) Other investments in debt instruments at amortised cost include large denomination certificates of deposit and bonds, etc. (ii) Unlisted investments include non-publicly traded trust schemes and debt investment plans, etc. **As at 31 December 2025** | Fair value hierarchy | Level 1 | Level 2 | Level 3 | Total | | :--- | :--- | :--- | :--- | :--- | | | **RMB million** | **RMB million** | **RMB million** | **RMB million** | | Trust schemes | – | – | 102,328 | 102,328 | | Debt investment plans | – | – | 74,420 | 74,420 | | Others | 356 | 3,410 | – | 3,766 | | **Total** | **356** | **3,410** | **176,748** | **180,514** | **As at 31 December 2024** | Fair value hierarchy | Level 1 | Level 2 | Level 3 | Total | | :--- | :--- | :--- | :--- | :--- | | | **RMB million** | **RMB million** | **RMB million** | **RMB million** | | Trust schemes | – | – | 120,981 | 120,981 | | Debt investment plans | – | – | 73,848 | 73,848 | | Others | 875 | 2,746 | 8,765 | 12,386 | | **Total** | **875** | **2,746** | **203,594** | **207,215** | --- # Notes to the Consolidated Financial Statements (continued) **For the year ended 31 December 2025** ## 11 FINANCIAL ASSETS (continued) ### 11.3 Investment in debt instruments at amortised cost (continued) | Contractual maturity schedule | As at 31 December 2025 (RMB million) | As at 31 December 2024 (RMB million) | | :--- | :--- | :--- | | **Maturing:** | | | | Within one year | 19,951 | 38,460 | | After one year but within five years | 126,537 | 112,487 | | After five years but within ten years | 25,858 | 44,231 | | Over ten years | 1,646 | 1,576 | | **Total** | **173,992** | **196,754** | ### 11.4 Investment in debt instruments at fair value through other comprehensive income | | As at 31 December 2025 (RMB million) | As at 31 December 2024 (RMB million) | | :--- | :--- | :--- | | Government bonds | 631,917 | 688,755 | | Government agency bonds | 2,655,145 | 2,179,824 | | Corporate bonds | 492,720 | 446,221 | | Subordinated bonds | 20,462 | 21,229 | | Others (i) (i) Mainly including trust schemes and debt investment plans. | 125,798 | 122,866 | | **Total** | **3,926,042** | **3,458,895** | | **By place of listing:** | | | | Listed in Mainland, PRC | 395,645 | 431,701 | | Listed in Hong Kong, PRC | 86 | 93 | | Listed overseas | 1,486 | 1,055 | | Unlisted (ii) (ii) This mainly includes bonds traded in the Chinese interbank market, non-publicly traded trust schemes and debt investment plans. | 3,528,825 | 3,026,046 | | **Total** | **3,926,042** | **3,458,895** | | **Contractual maturity schedule** | | | | **Maturing:** | | | | Within one year | 228,226 | 152,936 | | After one year but within five years | 381,312 | 424,910 | | After five years but within ten years | 204,713 | 233,853 | | Over ten years | 3,111,791 | 2,647,196 | | **Total** | **3,926,042** | **3,458,895** | | **Impairment** | **(1,020)** | **(928)** | --- # Notes to the Consolidated Financial Statements (continued) For the year ended 31 December 2025 ## 11 FINANCIAL ASSETS (continued) ### 11.5 Investment in equity instruments at fair value through other comprehensive income | | As at 31 December 2025 | As at 31 December 2024 | | :--- | :---: | :---: | | | **RMB million** | **RMB million** | | Common stocks | 232,447 | 60,153 | | Preferred stocks | 48,690 | 51,444 | | Others (i) (i) Other investments in equity instruments at fair value through other comprehensive income and unlisted investments mainly include perpetual bonds, etc. | 36,739 | 60,220 | | **Total** | **317,876** | **171,817** | | **By place of listing:** | | | | Listed in Mainland, PRC | 205,327 | 77,345 | | Listed in Hong Kong, PRC | 77,877 | 36,338 | | Unlisted (i) (i) Other investments in equity instruments at fair value through other comprehensive income and unlisted investments mainly include perpetual bonds, etc. | 34,672 | 58,134 | | **Total** | **317,876** | **171,817** | In 2025, the Group disposed of investment in equity instruments at fair value through other comprehensive income amounting to RMB69,142 million (2024: RMB29,331 million), and the net cumulative gains on disposal were RMB5,261 million (2024: RMB2,559 million). The dividends income from investment in equity instruments at fair value through other comprehensive income recognised during the year is described in Note 22. ### 11.6 Financial assets at fair value through profit or loss | | As at 31 December 2025 | As at 31 December 2024 | | :--- | :---: | :---: | | | **RMB million** | **RMB million** | | Government bonds | 5,007 | 3,905 | | Government agency bonds | 8,145 | 8,849 | | Corporate bonds | 110,430 | 202,923 | | Subordinated bonds | 330,286 | 347,604 | | Funds | 421,842 | 306,551 | | Common stocks | 602,895 | 440,930 | | Others (i) (i) Mainly including trust schemes, perpetual bonds, private equity funds, and unlisted equity. | 588,683 | 597,336 | | **Total** | **2,067,288** | **1,908,098** | | **By place of listing:** | | | | Listed in Mainland, PRC | 756,159 | 572,717 | | Listed in Hong Kong, PRC | 51,102 | 36,517 | | Listed overseas | 24,714 | 23,194 | | Unlisted (ii) (ii) This mainly includes bonds traded in the Chinese interbank market, non-publicly traded trust schemes, perpetual bonds, private equity funds, and unlisted equity. | 1,235,313 | 1,275,670 | | **Total** | **2,067,288** | **1,908,098** | --- # Notes to the Consolidated Financial Statements (continued) For the year ended 31 December 2025 ## 11 FINANCIAL ASSETS (continued) ### 11.7 Financial assets purchased under agreements to resell | | As at 31 December 2025 | As at 31 December 2024 | | :--- | :--- | :--- | | | **RMB million** | **RMB million** | | Maturing: | | | | Within 30 days | 50,879 | 30,560 | ## 12 FAIR VALUE OF FINANCIAL ASSETS AND LIABILITIES The table below presents the carrying amount and estimated fair value of major financial assets and liabilities: | | Carrying amount As at 31 December 2025 | Carrying amount As at 31 December 2024 | Estimated fair value As at 31 December 2025 | Estimated fair value As at 31 December 2024 | | :--- | :--- | :--- | :--- | :--- | | | **RMB million** | **RMB million** | **RMB million** | **RMB million** | | Term deposits | 418,688 | 438,455 | 418,688 | 438,455 | | Statutory deposits – restricted | 6,620 | 6,591 | 6,620 | 6,591 | | Investment in debt instruments at amortised cost | 173,992 | 196,754 | 180,514 | 207,215 | | Investment in debt instruments at fair value through other comprehensive income | 3,926,042 | 3,458,895 | 3,926,042 | 3,458,895 | | Investment in equity instruments at fair value through other comprehensive income | 317,876 | 171,817 | 317,876 | 171,817 | | Financial assets at fair value through profit or loss | 2,067,288 | 1,908,098 | 2,067,288 | 1,908,098 | | Financial assets purchased under agreements to resell | 50,879 | 30,560 | 50,879 | 30,560 | | Cash and cash equivalents | 142,373 | 85,505 | 142,373 | 85,505 | | Financial liabilities at fair value through profit or loss | (82,010) | (53,521) | (82,010) | (53,521) | | Financial assets sold under agreements to repurchase | (331,863) | (151,564) | (331,863) | (151,564) | | Bonds payable | (35,195) | (35,194) | (35,178) | (35,387) | | Interest-bearing loans and other borrowings | (56) | (12,758) | (56) | (12,758) | --- # Notes to the Consolidated Financial Statements (continued) For the year ended 31 December 2025 ## 12 FAIR VALUE OF FINANCIAL ASSETS AND LIABILITIES (continued) The fair values of the underlying items of the Group's Insurance contracts with direct participation features are as follows: | | As at 31 December 2025 | As at 31 December 2024 | | :--- | :---: | :---: | | | **RMB million** | **RMB million** | | Cash and cash equivalents | 50,437 | 38,203 | | Term deposits | 115,671 | 102,607 | | Investment in debt instruments at amortised cost | – | 1,938 | | Investment in debt instruments at fair value through other comprehensive income | 1,472,190 | 1,457,353 | | Investment in equity instruments at fair value through other comprehensive income | 41,193 | 50,316 | | Financial assets at fair value through profit or loss | 770,972 | 702,762 | | Other miscellaneous items | 31,819 | 69,432 | | **Total** | **2,482,282** | **2,422,611** | ## 13 OTHER ASSETS | | As at 31 December 2025 | As at 31 December 2024 | | :--- | :---: | :---: | | | **RMB million** | **RMB million** | | Investments receivable | 18,568 | 2,805 | | Land use rights (i) | 7,377 | 7,620 | | Disbursements | 4,516 | 5,140 | | Due from related parties | 1,102 | 1,084 | | Prepayments to constructors | 100 | 99 | | Others (ii) | 16,278 | 14,964 | | **Total** | **47,941** | **31,712** | (i) The Group’s right-of-use assets include the above land use rights and right-of-use assets disclosed in Note 8. (ii) As at 31 December 2025, other items in the Group’s other assets were mainly subsidiaries’ real estate related assets (as at 31 December 2024: same). For the year ended 31 December 2025, the Group recognised an expected credit loss of RMB20 million for other receivables (2024: RMB57 million), and the ending balance of provision for impairment for other receivables is RMB668 million (as at 31 December 2024: RMB773 million). --- # Notes to the Consolidated Financial Statements (continued) For the year ended 31 December 2025 ## 14 INSURANCE CONTRACTS ### 14.1 Significant actuarial assumptions **(1) Estimates of future cash flows** All of the future cash flows within the boundary of each group of contracts are included in the measurement of each group of insurance contracts. The Group estimates cash flows which are expected in the future and the timing and probability that they will occur based on the information available at the reporting date. The Group's expectations are based on past events, the information provided by current conditions, and the forecasts of future conditions. The Group's estimate of future cash flows is the probability-weighted mean of a range of scenarios that reflect the full range of possible outcomes. The Group adjusts the estimates of future cash flows to reflect the time value of money. Based on the information available at the date of statement of financial position, the Group reassesses the assumptions used to develop estimates about future cash flows. Significant actuarial assumptions used are discussed below: ### Discount rates Based on the information available at the reporting date, the Group applies the bottom-up approach in determining the discount rate for future cash flows of the insurance contracts by adjusting tax premium and liquidity premium based on the risk-free yield curve. The assumed spot discount rates are as follows: | | Discount rate assumptions | | :--- | :--- | | As at 31 December 2025 | 1.71% ~ 4.72% | | As at 31 December 2024 | 1.55% ~ 4.77% | ### Mortality/Morbidity The mortality and morbidity assumptions are based on the Group’s historical mortality and morbidity experience. The assumed mortality rates and morbidity rates vary with the gender, age of the insured and contract type. The Group bases its mortality assumptions on the China Life Insurance Mortality Table (2010-2013), adjusted where appropriate to reflect the Group’s historical mortality experience. The Group bases its morbidity assumptions on analysis of historical experience and change trend of future developments. There is uncertainty of mortality and morbidity assumptions that affected by epidemics, natural disasters, accidents, lifestyle changes, medical care, social conditions and other factors. ### Lapse rates The lapse rates are affected by certain factors, such as future macro-economy, availability of financial substitutions, and market competition, which bring uncertainty to these assumptions. The lapse rates are determined with reference to creditable past experience, current conditions, future expectations and other information. ### Expense assumptions Expense assumptions are based on the information available at the reporting date with the consideration of previous expense studies and future trends. Expense assumptions are affected by certain factors such as future inflation and market competition which bring uncertainty to these assumptions. --- # Notes to the Consolidated Financial Statements (continued) For the year ended 31 December 2025 ## 14 INSURANCE CONTRACTS (continued) ### 14.1 Significant actuarial assumptions (continued) #### (1) Estimates of future cash flows (continued) **Policy dividend assumption** The policy dividend assumption is uncertainty and is affected by factors such as the expected investment returns, the Group’s dividend policy, and the reasonable expectations of policyholders. The Group is obliged to pay 70% or a higher percentage as agreed in the insurance policy of the cumulative distributable income to the participating insurance policyholders. #### (2) Risk adjustment for non-financial risk The risk adjustment for non-financial risk is calculated at the Group level and then allocated down to each group of contracts in accordance with their risk profiles. The Group determines non-financial risk adjustments based on the confidence interval method and at a 75% confidence level. ### 14.2 Insurance contract liabilities #### (1) Reconciliation of the liabilities for remaining coverage and the liabilities for incurred claims for insurance contracts issued **Contracts not measured using the premium allocation approach** | | Liabilities for remaining coverage: Excluding loss component | Liabilities for remaining coverage: Loss component | Liabilities for incurred claims | Total | | :--- | :---: | :---: | :---: | :---: | | | **RMB million** | **RMB million** | **RMB million** | **RMB million** | | **Insurance contract liabilities as at 1 January 2025** | **5,687,512** | **67,105** | **34,839** | **5,789,456** | | Contracts measured under the modified retrospective approach at transition | (109,093) | – | – | (109,093) | | Contracts measured under the fair value approach at transition | (20,442) | – | – | (20,442) | | Other contracts | (34,505) | – | – | (34,505) | | **Total insurance revenue** | **(164,040)** | **–** | **–** | **(164,040)** | | Incurred claims and other expenses | – | (2,642) | 47,279 | 44,637 | | Amortisation of insurance acquisition cash flows | 48,585 | – | – | 48,585 | | Losses and reversals of losses on onerous contracts | – | 4,980 | – | 4,980 | | Changes to liabilities for incurred claims | – | – | 726 | 726 | | **Total insurance service expenses** | **48,585** | **2,338** | **48,005** | **98,928** | | **Insurance service result** | **(115,455)** | **2,338** | **48,005** | **(65,112)** | | Financial changes in insurance contracts | 162,775 | 530 | 1 | 163,306 | | **Total amounts recognised in comprehensive income** | **47,320** | **2,868** | **48,006** | **98,194** | | **Investment components** | **(316,655)** | **–** | **316,655** | **–** | | Premiums received | 859,878 | – | – | 859,878 | | Insurance acquisition cash flows paid | (43,801) | – | – | (43,801) | | Claims and other expenses paid | – | – | (363,997) | (363,997) | | **Total cash flows** | **816,077** | **–** | **(363,997)** | **452,080** | | **Insurance contract liabilities as at 31 December 2025** | **6,234,254** | **69,973** | **35,503** | **6,339,730** | --- # Notes to the Consolidated Financial Statements (continued) For the year ended 31 December 2025 ## 14 INSURANCE CONTRACTS (continued) ### 14.2 Insurance contract liabilities (continued) (1) Reconciliation of the liabilities for remaining coverage and the liabilities for incurred claims for insurance contracts issued (continued) **Contracts not measured using the premium allocation approach (continued)** | RMB million | Liabilities for remaining coverage: Excluding loss component | Liabilities for remaining coverage: Loss component | Liabilities for incurred claims | Total | | :--- | :---: | :---: | :---: | :---: | | **Insurance contract liabilities as at 1 January 2024** | 4,759,114 | 30,904 | 35,387 | 4,825,405 | | Contracts measured under the modified retrospective approach at transition | (109,785) | — | — | (109,785) | | Contracts measured under the fair value approach at transition | (20,282) | — | — | (20,282) | | Other contracts | (26,808) | — | — | (26,808) | | **Total insurance revenue** | (156,875) | — | — | (156,875) | | Incurred claims and other expenses | — | (3,366) | 47,176 | 43,810 | | Amortisation of insurance acquisition cash flows | 45,167 | — | — | 45,167 | | Losses and reversals of losses on onerous contracts | — | 39,044 | — | 39,044 | | Changes to liabilities for incurred claims | — | — | 650 | 650 | | **Total insurance service expenses** | 45,167 | 35,678 | 47,826 | 128,671 | | **Insurance service result** | (111,708) | 35,678 | 47,826 | (28,204) | | Financial changes in insurance contracts | 592,442 | 523 | — | 592,965 | | **Total amounts recognised in comprehensive income** | 480,734 | 36,201 | 47,826 | 564,761 | | Investment components | (252,214) | — | 252,214 | — | | Premiums received | 747,663 | — | — | 747,663 | | Insurance acquisition cash flows paid | (47,785) | — | — | (47,785) | | Claims and other expenses paid | — | — | (300,588) | (300,588) | | **Total cash flows** | 699,878 | — | (300,588) | 399,290 | | **Insurance contract liabilities as at 31 December 2024** | 5,687,512 | 67,105 | 34,839 | 5,789,456 | --- # Notes to the Consolidated Financial Statements (continued) For the year ended 31 December 2025 ## 14 INSURANCE CONTRACTS (continued) ### 14.2 Insurance contract liabilities (continued) #### (1) Reconciliation of the liabilities for remaining coverage and the liabilities for incurred claims for insurance contracts issued (continued) **Contracts measured using the premium allocation approach** | | Liabilities for remaining coverage: Excluding loss component | Liabilities for remaining coverage: Loss component | Liabilities for incurred claims: Estimation of present value of future cash flows | Liabilities for incurred claims: Risk adjustment for non-financial risk | Total | | :--- | :---: | :---: | :---: | :---: | :---: | | **RMB million** | | | | | | | **Insurance contract liabilities as at 1 January 2025** | **4,763** | **1,307** | **28,915** | **585** | **35,570** | | Contracts measured under the modified retrospective approach at transition | 71 | – | – | – | 71 | | Other contracts | (50,167) | – | – | – | (50,167) | | Total insurance revenue | (50,096) | – | – | – | (50,096) | | Incurred claims and other expenses | – | (1,010) | 32,636 | 560 | 32,186 | | Amortisation of insurance acquisition cash flows | 17,029 | – | – | – | 17,029 | | Losses and reversals of losses on onerous contracts | – | 1,802 | – | – | 1,802 | | Changes to liabilities for incurred claims | – | – | (696) | (513) | (1,209) | | Total insurance service expenses | 17,029 | 792 | 31,940 | 47 | 49,808 | | **Insurance service result** | **(33,067)** | **792** | **31,940** | **47** | **(288)** | | Financial changes in insurance contracts | 984 | – | 432 | 10 | 1,426 | | **Total amounts recognised in comprehensive income** | **(32,083)** | **792** | **32,372** | **57** | **1,138** | | **Investment components** | **(34,636)** | **–** | **34,636** | **–** | **–** | | Premiums received | 85,621 | – | – | – | 85,621 | | Insurance acquisition cash flows paid | (17,518) | – | – | – | (17,518) | | Claims and other expenses paid | – | – | (68,427) | – | (68,427) | | **Total cash flows** | **68,103** | **–** | **(68,427)** | **–** | **(324)** | | **Insurance contract liabilities as at 31 December 2025** | **6,147** | **2,099** | **27,496** | **642** | **36,384** | --- # Notes to the Consolidated Financial Statements (continued) For the year ended 31 December 2025 ## 14 INSURANCE CONTRACTS (continued) ### 14.2 Insurance contract liabilities (continued) #### (1) Reconciliation of the liabilities for remaining coverage and the liabilities for incurred claims for insurance contracts issued (continued) **Contracts measured using the premium allocation approach (continued)** | | Liabilities for remaining coverage: Excluding loss component | Liabilities for remaining coverage: Loss component | Liabilities for incurred claims: Estimation of present value of future cash flows | Liabilities for incurred claims: Risk adjustment for non-financial risk | Total | | :--- | :---: | :---: | :---: | :---: | :---: | | **RMB million** | | | | | | | **Insurance contract liabilities as at 1 January 2024** | 6,251 | 798 | 26,143 | 578 | 33,770 | | Contracts measured under the modified retrospective approach at transition | (21) | — | — | — | (21) | | Other contracts | (51,265) | — | — | — | (51,265) | | **Total insurance revenue** | (51,286) | — | — | — | (51,286) | | Incurred claims and other expenses | — | (638) | 36,265 | 515 | 36,142 | | Amortisation of insurance acquisition cash flows | 16,795 | — | — | — | 16,795 | | Losses and reversals of losses on onerous contracts | — | 1,147 | — | — | 1,147 | | Changes to liabilities for incurred claims | — | — | (1,687) | (524) | (2,211) | | **Total insurance service expenses** | 16,795 | 509 | 34,578 | (9) | 51,873 | | **Insurance service result** | (34,491) | 509 | 34,578 | (9) | 587 | | Financial changes in insurance contracts | 1,405 | — | 659 | 16 | 2,080 | | **Total amounts recognised in comprehensive income** | (33,086) | 509 | 35,237 | 7 | 2,667 | | Investment components | (34,956) | — | 34,956 | — | — | | Premiums received | 83,993 | — | — | — | 83,993 | | Insurance acquisition cash flows paid | (17,439) | — | — | — | (17,439) | | Claims and other expenses paid | — | — | (67,421) | — | (67,421) | | **Total cash flows** | 66,554 | — | (67,421) | — | (867) | | **Insurance contract liabilities as at 31 December 2024** | 4,763 | 1,307 | 28,915 | 585 | 35,570 | --- # Notes to the Consolidated Financial Statements (continued) For the year ended 31 December 2025 ## 14 INSURANCE CONTRACTS (continued) ### 14.2 Insurance contract liabilities (continued) (2) Reconciliation of fulfilment cash flows and contractual service margin for insurance contracts issued **Contracts not measured using the premium allocation approach** | RMB million | Present value of future cash flows | Risk adjustment for non-financial risk | Contractual service margin | Total | | :--- | :---: | :---: | :---: | :---: | | **Insurance contract liabilities as at 1 January 2025** | 5,005,886 | 41,082 | 742,488 | 5,789,456 | | Contractual service margin recognised for the service provided | - | - | (68,475) | (68,475) | | Change in the risk adjustment for non-financial risk | - | (2,092) | - | (2,092) | | Current experience adjustment | (251) | - | - | (251) | | **Changes relating to current service** | (251) | (2,092) | (68,475) | (70,818) | | Impact of insurance contracts initially recognised in the period | (54,207) | 1,408 | 53,074 | 275 | | Changes in estimates with adjustment to contractual service margin | (17,904) | (474) | 18,378 | - | | Changes in estimates without adjustment to contractual service margin | 4,323 | 382 | - | 4,705 | | **Changes relating to future service** | (67,788) | 1,316 | 71,452 | 4,980 | | Changes to liabilities for incurred claims | 724 | 2 | - | 726 | | **Changes relating to past service** | 724 | 2 | - | 726 | | **Insurance service result** | (67,315) | (774) | 2,977 | (65,112) | | Financial changes in insurance contracts | 139,926 | 476 | 22,904 | 163,306 | | **Total amounts recognised in comprehensive income** | 72,611 | (298) | 25,881 | 98,194 | | Premiums received | 859,878 | - | - | 859,878 | | Insurance acquisition cash flows paid | (43,801) | - | - | (43,801) | | Claims and other expenses paid | (363,997) | - | - | (363,997) | | **Total cash flows** | 452,080 | - | - | 452,080 | | **Insurance contract liabilities as at 31 December 2025** | 5,530,577 | 40,784 | 768,369 | 6,339,730 | --- # Notes to the Consolidated Financial Statements (continued) For the year ended 31 December 2025 ## 14 INSURANCE CONTRACTS (continued) ### 14.2 Insurance contract liabilities (continued) #### (2) Reconciliation of fulfilment cash flows and contractual service margin for insurance contracts issued (continued) **Contracts not measured using the premium allocation approach (continued)** | RMB million | Present value of future cash flows | Risk adjustment for non-financial risk | Contractual service margin | Total | | :--- | :---: | :---: | :---: | :---: | | **Insurance contract liabilities as at 1 January 2024** | 4,019,340 | 36,928 | 769,137 | 4,825,405 | | Contractual service margin recognised for the service provided | – | – | (64,126) | (64,126) | | Change in the risk adjustment for non-financial risk | – | (2,033) | – | (2,033) | | Current experience adjustment | (1,739) | – | – | (1,739) | | **Changes relating to current service** | (1,739) | (2,033) | (64,126) | (67,898) | | Impact of insurance contracts initially recognised in the period | (58,079) | 1,450 | 57,708 | 1,079 | | Changes in estimates with adjustment to contractual service margin | 44,088 | (466) | (43,622) | – | | Changes in estimates without adjustment to contractual service margin | 37,444 | 521 | – | 37,965 | | **Changes relating to future service** | 23,453 | 1,505 | 14,086 | 39,044 | | Changes to liabilities for incurred claims | 648 | 2 | – | 650 | | **Changes relating to past service** | 648 | 2 | – | 650 | | **Insurance service result** | 22,362 | (526) | (50,040) | (28,204) | | Financial changes in insurance contracts | 564,894 | 4,680 | 23,391 | 592,965 | | **Total amounts recognised in comprehensive income** | 587,256 | 4,154 | (26,649) | 564,761 | | Premiums received | 747,663 | – | – | 747,663 | | Insurance acquisition cash flows paid | (47,785) | – | – | (47,785) | | Claims and other expenses paid | (300,588) | – | – | (300,588) | | **Total cash flows** | 399,290 | – | – | 399,290 | | **Insurance contract liabilities as at 31 December 2024** | 5,005,886 | 41,082 | 742,488 | 5,789,456 | As at December 31 2025, the Group expects that 64.59% (as at December 31 2024: 63.82%) of the contractual service margin for insurance contracts not measured using the premium allocation approach will be amortised into profit over next 10 years. --- # Notes to the Consolidated Financial Statements (continued) For the year ended 31 December 2025 ## 14 INSURANCE CONTRACTS (continued) ### 14.2 Insurance contract liabilities (continued) **(3) Impact of the initial recognition of the insurance contracts issued in the current period** Contracts not measured using the premium allocation approach | | 2025 Non-onerous contracts | 2025 Onerous contracts | 2025 Total | 2024 Non-onerous contracts | 2024 Onerous contracts | 2024 Total | | :--- | :---: | :---: | :---: | :---: | :---: | :---: | | | **RMB million** | **RMB million** | **RMB million** | **RMB million** | **RMB million** | **RMB million** | | Estimates of the present value of future cash inflows | (674,725) | (104,748) | (779,473) | (699,363) | (112,729) | (812,092) | | Insurance acquisition cash flows | 46,968 | 277 | 47,245 | 60,713 | 1,956 | 62,669 | | Others | 573,428 | 104,593 | 678,021 | 579,656 | 111,688 | 691,344 | | Estimates of the present value of future cash outflows | 620,396 | 104,870 | 725,266 | 640,369 | 113,644 | 754,013 | | Risk adjustment for non-financial risk | 1,255 | 153 | 1,408 | 1,286 | 164 | 1,450 | | Contractual service margin | 53,074 | - | 53,074 | 57,708 | - | 57,708 | | **Total** | **-** | **275** | **275** | **-** | **1,079** | **1,079** | **(4) Reconciliation of contractual service margin for insurance contracts not measured using the premium allocation approach** | | Insurance contracts measured under the modified retrospective approach at the transition date | Insurance contracts measured under the fair value approach at the transition date | Other contracts | Total | | :--- | :---: | :---: | :---: | :---: | | | **RMB million** | **RMB million** | **RMB million** | **RMB million** | | **As at 1 January 2025** | **498,680** | **130,530** | **113,278** | **742,488** | | Changes relating to current service | (47,739) | (11,275) | (9,461) | (68,475) | | Impact of insurance contracts initially recognised in the period | - | - | 53,074 | 53,074 | | Changes in estimates with adjustment to contractual service margin | 17,648 | 2,348 | (1,618) | 18,378 | | **Changes relating to future service** | **17,648** | **2,348** | **51,456** | **71,452** | | Financial changes in insurance contracts | 15,206 | 4,205 | 3,493 | 22,904 | | **As at 31 December 2025** | **483,795** | **125,808** | **158,766** | **768,369** | --- # Notes to the Consolidated Financial Statements (continued) For the year ended 31 December 2025 ## 14 INSURANCE CONTRACTS (continued) ### 14.2 Insurance contract liabilities (continued) **(4) Reconciliation of contractual service margin for insurance contracts not measured using the premium allocation approach (continued)** | (RMB million) | Insurance contracts measured under the modified retrospective approach at the transition date | Insurance contracts measured under the fair value approach at the transition date | Other contracts | Total | | :--- | :---: | :---: | :---: | :---: | | **As at 1 January 2024** | **557,494** | **136,909** | **74,734** | **769,137** | | Changes relating to current service | (46,347) | (11,647) | (6,132) | (64,126) | | Impact of insurance contracts initially recognised in the period | — | — | 57,708 | 57,708 | | Changes in estimates with adjustment to contractual service margin | (28,590) | 1,060 | (16,092) | (43,622) | | **Changes relating to future service** | **(28,590)** | **1,060** | **41,616** | **14,086** | | Financial changes in insurance contracts | 16,123 | 4,208 | 3,060 | 23,391 | | **As at 31 December 2024** | **498,680** | **130,530** | **113,278** | **742,488** | --- # Notes to the Consolidated Financial Statements (continued) For the year ended 31 December 2025 ## 14 INSURANCE CONTRACTS (continued) ### 14.3 Reinsurance contract assets/(liabilities) **(1) Reconciliation of remaining coverage and incurred claims for reinsurance contracts held** Contracts not measured using the premium allocation approach | RMB million | Assets for remaining coverage recovered from reinsurers: Excluding loss-recovery component | Assets for remaining coverage recovered from reinsurers: Loss-recovery component | Assets for incurred claims recovered from reinsurers | Total | | :--- | :---: | :---: | :---: | :---: | | Reinsurance contract assets as at 1 January 2025 | 15,110 | 2,212 | 11,369 | 28,691 | | Reinsurance contract liabilities as at 1 January 2025 | (164) | - | 18 | (146) | | **Net assets/(liabilities) of reinsurance contract as at 1 January 2025** | **14,946** | **2,212** | **11,387** | **28,545** | | Allocation of reinsurance premiums paid | (4,800) | - | - | (4,800) | | Recovery of incurred claims and other expenses | - | (244) | 3,135 | 2,891 | | Recognition and reversals of loss-recovery component | - | 684 | - | 684 | | Changes to assets for incurred claims recovered from reinsurers | - | - | 1,031 | 1,031 | | Amounts recovered from reinsurers | - | 440 | 4,166 | 4,606 | | Gains or losses on reinsurance contracts | (4,800) | 440 | 4,166 | (194) | | Financial changes in reinsurance contracts held | (87) | 122 | - | 35 | | **Total amounts recognised in comprehensive income** | **(4,887)** | **562** | **4,166** | **(159)** | | **Investment components** | **(1,816)** | **-** | **1,816** | **-** | | Reinsurance premiums paid | 2,005 | - | - | 2,005 | | Incurred claims and other expenses recovered from reinsurers | - | - | (1,739) | (1,739) | | **Total cash flows** | **2,005** | **-** | **(1,739)** | **266** | | **Net assets/(liabilities) of reinsurance contract as at 31 December 2025** | **10,248** | **2,774** | **15,630** | **28,652** | | Reinsurance contract assets as at 31 December 2025 | 10,719 | 2,772 | 15,426 | 28,917 | | Reinsurance contract liabilities as at 31 December 2025 | (471) | 2 | 204 | (265) | --- # Notes to the Consolidated Financial Statements (continued) For the year ended 31 December 2025 ## 14 INSURANCE CONTRACTS (continued) ### 14.3 Reinsurance contract assets/(liabilities) (continued) (1) Reconciliation of remaining coverage and incurred claims for reinsurance contracts held (continued) **Contracts not measured using the premium allocation approach (continued)** | | Assets for remaining coverage recovered from reinsurers: Excluding loss-recovery component | Assets for remaining coverage recovered from reinsurers: Loss-recovery component | Assets for incurred claims recovered from reinsurers | Total | | :--- | :---: | :---: | :---: | :---: | | **RMB million** | | | | | | **Reinsurance contract assets as at 1 January 2024** | 15,043 | 2,290 | 7,087 | 24,420 | | **Reinsurance contract liabilities as at 1 January 2024** | (142) | – | 19 | (123) | | **Net assets/(liabilities) of reinsurance contract as at 1 January 2024** | 14,901 | 2,290 | 7,106 | 24,297 | | Allocation of reinsurance premiums paid | (4,690) | – | – | (4,690) | | Recovery of incurred claims and other expenses | – | (193) | 3,116 | 2,923 | | Recognition and reversals of loss-recovery component | – | (6) | – | (6) | | Changes to assets for incurred claims recovered from reinsurers | – | – | 2,346 | 2,346 | | Amounts recovered from reinsurers | – | (199) | 5,462 | 5,263 | | **Gains or losses on reinsurance contracts** | (4,690) | (199) | 5,462 | 573 | | Financial changes in reinsurance contracts held | 4,032 | 121 | – | 4,153 | | **Total amounts recognised in comprehensive income** | (658) | (78) | 5,462 | 4,726 | | **Investment components** | (1,820) | – | 1,820 | – | | Reinsurance premiums paid | 2,523 | – | – | 2,523 | | Incurred claims and other expenses recovered from reinsurers | – | – | (3,001) | (3,001) | | **Total cash flows** | 2,523 | – | (3,001) | (478) | | **Net assets/(liabilities) of reinsurance contract as at 31 December 2024** | 14,946 | 2,212 | 11,387 | 28,545 | | **Reinsurance contract assets as at 31 December 2024** | 15,110 | 2,212 | 11,369 | 28,691 | | **Reinsurance contract liabilities as at 31 December 2024** | (164) | – | 18 | (146) | --- # Notes to the Consolidated Financial Statements (continued) For the year ended 31 December 2025 ## 14 INSURANCE CONTRACTS (continued) ### 14.3 Reinsurance contract assets/(liabilities) (continued) **(1) Reconciliation of remaining coverage and incurred claims for reinsurance contracts held (continued)** Contracts measured using the premium allocation approach | RMB million | Assets for remaining coverage recovered from reinsurers: Excluding loss-recovery component | Assets for remaining coverage recovered from reinsurers: Loss-recovery component | Assets for incurred claims recovered from reinsurers: Present value of future cash flows | Assets for incurred claims recovered from reinsurers: Risk adjustment for non-financial risk | Total | | :--- | :---: | :---: | :---: | :---: | :---: | | Reinsurance contract assets as at 1 January 2025 | (954) | 23 | 2,967 | 11 | 2,047 | | Reinsurance contract liabilities as at 1 January 2025 | (59) | 1 | 44 | – | (14) | | **Net assets/(liabilities) of reinsurance contract as at 1 January 2025** | **(1,013)** | **24** | **3,011** | **11** | **2,033** | | Allocation of reinsurance premiums paid | (950) | – | – | – | (950) | | Recovery of incurred claims and other expenses | – | (21) | 396 | 6 | 381 | | Recognition and reversals of loss-recovery component | – | 44 | – | – | 44 | | Changes to assets for incurred claims recovered from reinsurers | – | – | 227 | (10) | 217 | | Amounts recovered from reinsurers | – | 23 | 623 | (4) | 642 | | **Gains or losses on reinsurance contracts** | **(950)** | **23** | **623** | **(4)** | **(308)** | | Financial changes in reinsurance contracts held | 13 | – | 16 | – | 29 | | **Total amounts recognised in comprehensive income** | **(937)** | **23** | **639** | **(4)** | **(279)** | | Investment components | (321) | – | 321 | – | – | | Reinsurance premiums paid | 294 | – | – | – | 294 | | Incurred claims and other expenses recovered from reinsurers | – | – | (998) | – | (998) | | **Total cash flows** | **294** | **–** | **(998)** | **–** | **(704)** | | **Net assets/(liabilities) of reinsurance contract as at 31 December 2025** | **(1,977)** | **47** | **2,973** | **7** | **1,050** | | Reinsurance contract assets as at 31 December 2025 | (1,775) | 45 | 2,820 | 7 | 1,097 | | Reinsurance contract liabilities as at 31 December 2025 | (202) | 2 | 153 | – | (47) | --- # Notes to the Consolidated Financial Statements (continued) For the year ended 31 December 2025 ## 14 INSURANCE CONTRACTS (continued) ### 14.3 Reinsurance contract assets/(liabilities) (continued) #### (1) Reconciliation of remaining coverage and incurred claims for reinsurance contracts held (continued) Contracts measured using the premium allocation approach (continued) | RMB million | Assets for remaining coverage: Excluding loss-recovery component | Assets for remaining coverage: Loss-recovery component | Assets for incurred claims: Present value of future cash flows | Assets for incurred claims: Risk adjustment for non-financial risk | Total | | :--- | :---: | :---: | :---: | :---: | :---: | | **Reinsurance contract assets as at 1 January 2024** | (402) | 28 | 1,790 | 10 | 1,426 | | **Reinsurance contract liabilities as at 1 January 2024** | (166) | 1 | 100 | – | (65) | | **Net assets/(liabilities) of reinsurance contract as at 1 January 2024** | (568) | 29 | 1,890 | 10 | 1,361 | | Allocation of reinsurance premiums paid | (381) | – | – | – | (381) | | Recovery of incurred claims and other expenses | – | (29) | 632 | 10 | 613 | | Recognition and reversals of loss-recovery component | – | 24 | – | – | 24 | | Changes to assets for incurred claims recovered from reinsurers | – | – | (442) | (9) | (451) | | Amounts recovered from reinsurers | – | (5) | 190 | 1 | 186 | | **Gains or losses on reinsurance contracts** | (381) | (5) | 190 | 1 | (195) | | Financial changes in reinsurance contracts held | 38 | – | 36 | – | 74 | | **Total amounts recognised in comprehensive income** | (343) | (5) | 226 | 1 | (121) | | **Investment components** | (1,308) | – | 1,308 | – | – | | Reinsurance premiums paid | 1,206 | – | – | – | 1,206 | | Incurred claims and other expenses recovered from reinsurers | – | – | (413) | – | (413) | | **Total cash flows** | 1,206 | – | (413) | – | 793 | | **Net assets/(liabilities) of reinsurance contract as at 31 December 2024** | (1,013) | 24 | 3,011 | 11 | 2,033 | | **Reinsurance contract assets as at 31 December 2024** | (954) | 23 | 2,967 | 11 | 2,047 | | **Reinsurance contract liabilities as at 31 December 2024** | (59) | 1 | 44 | – | (14) | --- # Notes to the Consolidated Financial Statements (continued) For the year ended 31 December 2025 ## 14 INSURANCE CONTRACTS (continued) ### 14.3 Reinsurance contract assets/(liabilities) (continued) (2) Reconciliation of fulfilment cash flows and contractual service margin for reinsurance contracts held **Contracts not measured using the premium allocation approach** | RMB million | Present value of future cash flows | Risk adjustment for non-financial risk | Contractual service margin | Total | | :--- | :---: | :---: | :---: | :---: | | **Reinsurance contract assets as at 1 January 2025** | 31,250 | 8,774 | (11,333) | 28,691 | | **Reinsurance contract liabilities as at 1 January 2025** | (368) | 36 | 186 | (146) | | **Net assets/(liabilities) of reinsurance contract as at 1 January 2025** | 30,882 | 8,810 | (11,147) | 28,545 | | Contractual service margin recognised for the service provided | — | — | 851 | 851 | | Change in the risk adjustment for non-financial risk | — | (399) | — | (399) | | Current experience adjustment | (2,361) | — | — | (2,361) | | **Changes relating to current service** | (2,361) | (399) | 851 | (1,909) | | Impact of reinsurance contracts held initially recognised in the period | 226 | 137 | (363) | — | | Changes in estimates with adjustment to contractual service margin | (1,743) | (25) | 1,768 | — | | Changes in estimates without adjustment to contractual service margin | 657 | 27 | — | 684 | | **Changes relating to future service** | (860) | 139 | 1,405 | 684 | | Changes to assets for incurred claims recovered from reinsurers | 1,031 | — | — | 1,031 | | **Changes relating to past service** | 1,031 | — | — | 1,031 | | **Gains or losses on reinsurance contracts held** | (2,190) | (260) | 2,256 | (194) | | Financial changes in reinsurance contracts held | 506 | 122 | (593) | 35 | | **Total amounts recognised in comprehensive income** | (1,684) | (138) | 1,663 | (159) | | Reinsurance premiums paid | 2,005 | — | — | 2,005 | | Incurred claims and other expenses recovered from reinsurers | (1,739) | — | — | (1,739) | | **Total cash flows** | 266 | — | — | 266 | | **Net assets/(liabilities) of reinsurance contract as at 31 December 2025** | 29,464 | 8,672 | (9,484) | 28,652 | | **Reinsurance contract assets as at 31 December 2025** | 30,830 | 8,511 | (10,424) | 28,917 | | **Reinsurance contract liabilities as at 31 December 2025** | (1,366) | 161 | 940 | (265) | --- # Notes to the Consolidated Financial Statements (continued) ## 14 INSURANCE CONTRACTS (continued) ### 14.3 Reinsurance contract assets/(liabilities) (continued) #### (2) Reconciliation of fulfilment cash flows and contractual service margin for reinsurance contracts held (continued) **Contracts not measured using the premium allocation approach (continued)** | RMB million | Present value of future cash flows | Risk adjustment for non-financial risk | Contractual service margin | Total | | :--- | :---: | :---: | :---: | :---: | | **Reinsurance contract assets as at 1 January 2024** | 27,197 | 7,859 | (10,636) | 24,420 | | **Reinsurance contract liabilities as at 1 January 2024** | (78) | 35 | (80) | (123) | | **Net assets/(liabilities) of reinsurance contract as at 1 January 2024** | 27,119 | 7,894 | (10,716) | 24,297 | | Contractual service margin recognised for the service provided | – | – | 980 | 980 | | Change in the risk adjustment for non-financial risk | – | (395) | – | (395) | | Current experience adjustment | (2,352) | – | – | (2,352) | | **Changes relating to current service** | (2,352) | (395) | 980 | (1,767) | | Impact of reinsurance contracts held initially recognised in the period | (84) | 47 | 37 | – | | Changes in estimates with adjustment to contractual service margin | 826 | 89 | (915) | – | | Changes in estimates without adjustment to contractual service margin | (7) | 1 | – | (6) | | **Changes relating to future service** | 735 | 137 | (878) | (6) | | Changes to assets for incurred claims recovered from reinsurers | 2,346 | – | – | 2,346 | | **Changes relating to past service** | 2,346 | – | – | 2,346 | | **Gains or losses on reinsurance contracts held** | 729 | (258) | 102 | 573 | | **Financial changes in reinsurance contracts held** | 3,512 | 1,174 | (533) | 4,153 | | **Total amounts recognised in comprehensive income** | 4,241 | 916 | (431) | 4,726 | | Reinsurance premiums paid | 2,523 | – | – | 2,523 | | Incurred claims and other expenses recovered from reinsurers | (3,001) | – | – | (3,001) | | **Total cash flows** | (478) | – | – | (478) | | **Net assets/(liabilities) of reinsurance contract as at 31 December 2024** | 30,882 | 8,810 | (11,147) | 28,545 | | **Reinsurance contract assets as at 31 December 2024** | 31,250 | 8,774 | (11,333) | 28,691 | | **Reinsurance contract liabilities as at 31 December 2024** | (368) | 36 | 186 | (146) | As of December 31 2025, the Group expects that 56.31% (as at December 31 2024: 56.49%) of the contractual service margin for reinsurance contracts not measured using the premium allocation approach will be amortised into profit over the next 10 years. --- # Notes to the Consolidated Financial Statements (continued) For the year ended 31 December 2025 ## 14 INSURANCE CONTRACTS (continued) ### 14.3 Reinsurance contract assets/(liabilities) (continued) **(3) Impact of the initial recognition of the reinsurance contracts in the current period** Contracts not measured using the premium allocation approach For the year ended 31 December | RMB million | 2025 Reinsurance contracts with a net gain | 2025 Reinsurance contracts with a net cost | 2025 Total | 2024 Reinsurance contracts with a net gain | 2024 Reinsurance contracts with a net cost | 2024 Total | | :--- | :---: | :---: | :---: | :---: | :---: | :---: | | Estimates of the present value of future cash inflows | 2,617 | – | 2,617 | 639 | 269 | 908 | | Estimates of the present value of future cash outflows | (2,391) | – | (2,391) | (570) | (422) | (992) | | Risk adjustment for non-financial risk | 137 | – | 137 | 33 | 14 | 47 | | Contractual service margin | (363) | – | (363) | (102) | 139 | 37 | | **Total** | **–** | **–** | **–** | **–** | **–** | **–** | **(4) Reconciliation of contractual service margin for reinsurance contracts held not measured using the premium allocation approach** | RMB million | Reinsurance contracts held measured under the modified retrospective approach at the transition date | Other contracts | Total | | :--- | :---: | :---: | :---: | | **As at 1 January 2025** | **(11,270)** | **123** | **(11,147)** | | Changes relating to current service | 930 | (79) | 851 | | – Impact of reinsurance contracts initially recognised in the period | – | (363) | (363) | | – Changes in estimates with adjustment to contractual service margin | 527 | 1,241 | 1,768 | | Changes relating to future service | 527 | 878 | 1,405 | | Financial changes in reinsurance contracts held | (595) | 2 | (593) | | **As at 31 December 2025** | **(10,408)** | **924** | **(9,484)** | --- # Notes to the Consolidated Financial Statements (continued) For the year ended 31 December 2025 ## 14 INSURANCE CONTRACTS (continued) ### 14.3 Reinsurance contract assets/(liabilities) (continued) **(4) Reconciliation of contractual service margin for reinsurance contracts held not measured using the premium allocation approach (continued)** | | Reinsurance contracts held measured under the modified retrospective approach at the transition date | Other contracts | Total | | :--- | :---: | :---: | :---: | | | RMB million | RMB million | RMB million | | **As at 1 January 2024** | (10,585) | (131) | (10,716) | | Changes relating to current service | 1,003 | (23) | 980 | | Impact of reinsurance contracts initially recognised in the period | – | 37 | 37 | | Changes in estimates with adjustment to contractual service margin | (1,159) | 244 | (915) | | Changes relating to future service | (1,159) | 281 | (878) | | Financial changes in reinsurance contracts held | (529) | (4) | (533) | | **As at 31 December 2024** | (11,270) | 123 | (11,147) | ## 15 INTEREST-BEARING LOANS AND OTHER BORROWINGS | | Maturity date | Interest rate | As at 31 December 2025 | As at 31 December 2024 | | :--- | :--- | :--- | :---: | :---: | | | | | **RMB million** | **RMB million** | | Guaranteed loans | 8 September 2026 | EURIBOR+2.8% | – | 729 | | Guaranteed loans | 8 September 2026 | EURIBOR+2.8% | – | 2,493 | | Credit loans | 16 May 2025 | 3.08% | – | 2,511 | | Credit loans | 22 September 2025 | 6M SOFR+1.15% | – | 6,960 | | Credit loans | 16 April 2025 | 12.00% | – | 65 | | Credit loans | 21 December 2027 | 3.00% | 50 | – | | Credit loans | 12 November 2026 | 3.00% | 6 | – | | **Total** | | | **56** | **12,758** | --- # Notes to the Consolidated Financial Statements (continued) For the year ended 31 December 2025 ## 16 BONDS PAYABLE As at 31 December 2025, all bonds payable were the bonds for capital replenishment (the "Bond") with a total carrying amount of RMB35,195 million (as at 31 December 2024: RMB35,194 million), and the fair value of RMB35,178 million (as at 31 December 2024: RMB35,387 million). The fair value of the Bond was classified as level 2 in the fair value hierarchy. The following table presents the par value of the bonds payable: | Issue date | Maturity date | Interest rate p.a. | As at 31 December 2025 RMB million | As at 31 December 2024 RMB million | | :--- | :--- | :--- | :--- | :--- | | 26 September 2024 | 26 September 2034 | 2.15% | 35,000 | 35,000 | On 24 September 2024, the Company issued a bond in the national inter-bank bond market at a principal amount of RMB35 billion, and completed the issuance on 26 September 2024. The bond has a 10-year maturity and a fixed coupon rate of 2.15% per annum. The Company has a conditional right to redeem the bonds at the end of the fifth year. If the Company does not redeem the bonds at the end of the fifth year, the coupon rate per annum for the remaining 5 years will be raised to 3.15%. ## 17 OTHER LIABILITIES | | As at 31 December 2025 RMB million | As at 31 December 2024 RMB million | | :--- | :--- | :--- | | Payable to the third-party holders of consolidated structured entities | 61,908 | 96,428 | | Salary and welfare payable | 12,602 | 10,161 | | Brokerage and commission payable | 5,261 | 5,080 | | Tax payable | 2,327 | 1,380 | | Payable to constructors | 2,247 | 2,502 | | Stock appreciation rights (Note 29) | 1,041 | 421 | | Agency deposits | 1,025 | 1,056 | | Others | 20,645 | 23,903 | | **Total** | **107,056** | **140,931** | --- # Notes to the Consolidated Financial Statements (continued) For the year ended 31 December 2025 ## 18 FINANCIAL ASSETS SOLD UNDER AGREEMENTS TO REPURCHASE | | As at 31 December 2025 | As at 31 December 2024 | | :--- | :---: | :---: | | | **RMB million** | **RMB million** | | Interbank markets | 219,451 | 89,390 | | Stock exchange markets | 112,412 | 62,174 | | **Total** | **331,863** | **151,564** | | Maturing: | | | | Within 30 days | 331,854 | 151,561 | | More than 30 days within 90 days | 9 | 3 | | **Total** | **331,863** | **151,564** | As at 31 December 2025, bonds with a carrying amount of RMB268,629 million (as at 31 December 2024: RMB117,422 million) were pledged as collateral for financial assets sold under agreements to repurchase resulting from repurchase transactions entered into by the Group in the interbank markets. For debt repurchase transactions through the stock exchange, the Group is required to deposit certain exchange-traded bonds into a collateral pool with fair value converted at a standard rate pursuant to the stock exchange’s regulation which should be no less than the balance of the related repurchase transaction. As at 31 December 2025, the carrying amount of securities deposited in the collateral pool was RMB309,882 million (as at 31 December 2024: RMB295,843 million). The collateral is restricted from trading during the period of the repurchase transaction. ## 19 STATUTORY INSURANCE FUND Since 1 January 2023, the Group has paid the Insurance Protection Fund in accordance with the “Measures for the Administration of the Insurance Security Fund” (Issued by Order no.7 [2022] former CBIRC, the Ministry of Finance of the People’s Republic of China and the People’s Bank of China) and the “Notice of the General Office of the China Banking and Insurance Regulatory Commission on Matters related to the Payment of Insurance Protection Fund” (No. 2 [2023] of the General Office of the China Banking and Insurance Regulatory Commission). The fund contribution is equal to the product of the business income and the fund rate, which is composed of the base rate and the risk differential rate, and is equal to the sum of the base rate and the risk differential rate. ### (i) Benchmark Interest Rate - Short-term health insurance and accident insurance shall be paid at 0.8% of business income; - Life insurance, long-term health insurance and annuity insurance shall be paid at 0.3% of business income; Among them, investment-linked insurance shall be paid at 0.05% of business income. ### (ii) Risk differential rate The risk differential rate is based on the results of the comprehensive solvency risk rating. When the rating is A(including AAA, AA and A), B(including BBB, BB and B), C and D, the applicable rate is -0.02%, 0%, 0.02% and 0.04%, respectively. When the life insurance protection fund reaches 1% of the total assets of the industry, payment will be suspended. The total assets of the industry shall be subject to the data determined by the State Financial Supervision and Regulation. --- # Notes to the Consolidated Financial Statements (continued) For the year ended 31 December 2025 # 20 INSURANCE REVENUE | For the year ended 31 December | 2025 RMB million | 2024 RMB million | | :--- | :---: | :---: | | **Contracts not measured using the premium allocation approach** | | | | Amounts relating to the changes in the liabilities for remaining coverage: | | | | - Expected incurred claims and other expenses | 44,899 | 45,571 | | - Change in the risk adjustment for non-financial risk | 2,081 | 2,011 | | - Contractual service margin recognised for the service provided | 68,475 | 64,126 | | Amortisation of insurance acquisition cash flows | 48,585 | 45,167 | | **Sub-total** | **164,040** | **156,875** | | Contracts measured using the premium allocation approach | 50,096 | 51,286 | | **Total** | **214,136** | **208,161** | # 21 INTEREST INCOME | For the year ended 31 December | 2025 RMB million | 2024 RMB million | | :--- | :---: | :---: | | Financial assets measured at amortised cost (i) | 22,729 | 26,332 | | Investment in debt instruments at fair value through other comprehensive income | 105,557 | 94,626 | | **Total** | **128,286** | **120,958** | (i) Interest income from financial assets measured at amortised cost mainly includes interest income arising from cash and cash equivalents, financial assets purchased under agreements to resell, investment in debt instruments at amortised cost and term deposits. --- # Notes to the Consolidated Financial Statements (continued) For the year ended 31 December 2025 ## 22 INVESTMENT INCOME | | For the year ended 31 December | | | :--- | :---: | :---: | | | **2025** | **2024** | | | **RMB million** | **RMB million** | | **Dividends and interest income** | | | | Dividends | | | | Financial assets at fair value through profit or loss | 23,913 | 27,607 | | Investment in equity instruments at fair value through other comprehensive income | 10,840 | 6,882 | | Interest income | | | | Financial assets at fair value through profit or loss | 24,400 | 28,057 | | **Sub-total** | **59,153** | **62,546** | | **Realised gains/(losses)** | | | | Financial assets at fair value through profit or loss | 121,450 | (28,443) | | Investment in debt instruments at fair value through other comprehensive income | 7,612 | 24,166 | | Investment in associates and joint ventures | 3,878 | 32 | | Others | 11 | – | | **Sub-total** | **132,951** | **(4,245)** | | **Unrealised gains/(losses)** | | | | Financial assets at fair value through profit or loss | 64,719 | 119,063 | | Financial liabilities at fair value through profit or loss | (879) | (663) | | Stock appreciation rights | (533) | (240) | | **Sub-total** | **63,307** | **118,160** | | **Total** | **255,411** | **176,461** | ## 23 INSURANCE SERVICE EXPENSES | | For the year ended 31 December | | | :--- | :---: | :---: | | | **2025** | **2024** | | | **RMB million** | **RMB million** | | **Contracts not measured using the premium allocation approach** | | | | Incurred claims and other expenses | 44,637 | 43,810 | | Amortisation of insurance acquisition cash flows | 48,585 | 45,167 | | Losses and reversals of losses on onerous contracts | 4,980 | 39,044 | | Changes to liabilities for incurred claims | 726 | 650 | | **Sub-total** | **98,928** | **128,671** | | Contracts measured using the premium allocation approach | 49,808 | 51,873 | | **Total** | **148,736** | **180,544** | --- # Notes to the Consolidated Financial Statements (continued) For the year ended 31 December 2025 ## 24 NET INVESTMENT RETURN AND FINANCIAL CHANGES IN INSURANCE CONTRACTS | Net investment returns | For the year ended 31 December 2025 (RMB million) | For the year ended 31 December 2024 (RMB million) | | :--- | :---: | :---: | | **Returns on investment recognised in profit or loss** | | | | Interest income | 128,286 | 120,958 | | Investment income | 255,411 | 176,461 | | Investment income from associates and joint ventures | 6,353 | 12,077 | | Net expected credit losses | (151) | 207 | | Other impairment losses | (3,275) | (1,611) | | **Sub-total** | **386,624** | **308,092** | | Returns on investment recognised in other comprehensive income | (159,405) | 305,932 | | **Total** | **227,219** | **614,024** | | Financial changes in insurance contracts | For the year ended 31 December 2025 (RMB million) | For the year ended 31 December 2024 (RMB million) | | :--- | :---: | :---: | | Changes in fair value of underlying items of insurance contracts with direct participation features | 91,785 | 193,129 | | Interest expense | 110,108 | 101,019 | | Changes in interest rates and other financial assumptions | (37,161) | 300,897 | | **Total financial changes in insurance contracts** | **164,732** | **595,045** | | Recognised in profit or loss | 258,858 | 209,952 | | Recognised in other comprehensive income | (94,126) | 385,093 | | **Total** | **164,732** | **595,045** | ## 25 EXPECTED CREDIT LOSSES | For the year ended 31 December | 2025 (RMB million) | 2024 (RMB million) | | :--- | :---: | :---: | | Investment in debt instruments at fair value through other comprehensive income | 107 | (456) | | Investment in debt instruments at amortised cost | 27 | 167 | | Term deposits | (3) | 24 | | Statutory deposits – restricted | – | 1 | | Other receivables | 20 | 57 | | **Total** | **151** | **(207)** | --- # Notes to the Consolidated Financial Statements (continued) For the year ended 31 December 2025 ## 26 PROFIT BEFORE INCOME TAX Profit before income tax is stated after charging the following: | For the year ended 31 December | 2025 RMB million | 2024 RMB million | | :--- | :--- | :--- | | Salary and bonus | 19,719 | 18,357 | | Social security and other benefits | 7,918 | 8,021 | | Depreciation and amortisation | 4,892 | 5,029 | | Remuneration in respect of audit services provided by auditors | 57 | 54 | | Others | 25,042 | 24,760 | | **Less: Expenses directly attributable to insurance contracts** | | | | - Insurance acquisition cash flows recognised in liabilities for remaining coverage | (20,170) | (19,674) | | - Amounts recognised in insurance service expenses | (18,047) | (18,184) | | **Total** | **19,411** | **18,363** | The disclosure above does not include underwriting and policy acquisition costs in the fulfilment cash flows. ## 27 TAXATION Deferred tax assets and liabilities are offset when there is a legally enforceable right to offset current tax assets against current tax liabilities and when the deferred income tax relates to the same tax authority. ### (a) The amount of taxation charged to net profit represents: | For the year ended 31 December | 2025 RMB million | 2024 RMB million | | :--- | :--- | :--- | | Current taxation – Enterprise income tax | 2,134 | 1,566 | | Deferred taxation | 22,943 | 4,707 | | **Taxation charges** | **25,077** | **6,273** | --- # Notes to the Consolidated Financial Statements (continued) For the year ended 31 December 2025 ## 27 TAXATION (continued) **(b) The reconciliation between the Group’s effective tax rate and the statutory tax rate of 25% in the PRC (2024: same) is as follows:** | For the year ended 31 December | **2025** | **2024** | | :--- | :--- | :--- | | | **RMB million** | **RMB million** | | Profit before income tax | 181,629 | 115,213 | | Income tax computed at the statutory tax rate | 45,407 | 28,803 | | Effect of utilising previously unrecognised deferred tax assets attributable to deductible tax losses from prior periods | - | (4,291) | | Non-taxable income (i) (i) Non-taxable income mainly includes interest income from government bonds, and applicable dividend income. | (21,143) | (19,388) | | Expenses not deductible for tax purposes | 684 | 610 | | Deductible tax losses for which no deferred tax asset was recognised | 150 | 77 | | Others | (21) | 462 | | **Income tax at the effective tax rate** | **25,077** | **6,273** | (ii) The amendments to IAS 12 introduce a temporary mandatory exemption from the recognition and disclosure of deferred taxes arising from the implementation of the Pillar Two Model Rules published by the Organization for Economic Co-operation and Development. According to the rules of Pillar Two legislation, low-tax jurisdictions with effective tax rate below 15% may have a top-up tax impact. There are differences in the computation of effective tax rate between Pillar Two legislation and IFRS Accounting Standards. The Group evaluates that the Pillar Two legislation has no significant impact on the Group’s consolidated financial statements for the year 2025. **(c) As at 31 December 2025 and 31 December 2024, the amounts of deferred tax assets and liabilities were as follows:** | | **As at 31 December 2025** | **As at 31 December 2024** | | :--- | :--- | :--- | | | **RMB million** | **RMB million** | | Deferred tax assets | 156,446 | 187,950 | | Deferred tax liabilities | (123,495) | (148,071) | | **Net deferred tax assets** | **34,431** | **40,026** | | **Net deferred tax liabilities** | **(1,480)** | **(147)** | --- # Notes to the Consolidated Financial Statements (continued) For the year ended 31 December 2025 ## 27 TAXATION (continued) **(c)** As at 31 December 2025 and 31 December 2024, the amounts of deferred tax assets and liabilities were as follows: (continued) As at 31 December 2025, the deferred taxation was calculated in full on temporary differences under the liability method using the principal tax rate of 25% (as at 31 December 2024: same). The movements in deferred tax assets and liabilities during the year are as follows: ### Movements in deferred tax assets and liabilities - 2025 | | As at 1 January 2025 | Recognised in profit or loss in the current year | Recognised in other comprehensive income in the current year | As at 31 December 2025 | | :--- | :--- | :--- | :--- | :--- | | **RMB million** | | | | | | Provision for asset impairment | 2,203 | 385 | (24) | 2,564 | | Insurance contract liabilities | 142,794 | (18,320) | (23,384) | 101,090 | | Accrued payroll | 2,271 | 588 | — | 2,859 | | Deductible losses | 38,454 | 9,420 | — | 47,874 | | Changes in fair value of the financial assets at fair value through profit or loss | (10,320) | (16,922) | — | (27,242) | | Changes in fair value of the financial assets at fair value through other comprehensive income | (137,328) | — | 41,357 | (95,971) | | Others | 1,805 | 1,906 | (1,934) | 1,777 | | **Net value** | **39,879** | **(22,943)** | **16,015** | **32,951** | ### Movements in deferred tax assets and liabilities - 2024 | | As at 1 January 2024 | Recognised in profit or loss in the current year | Recognised in other comprehensive income in the current year | As at 31 December 2024 | | :--- | :--- | :--- | :--- | :--- | | **RMB million** | | | | | | Provision for asset impairment | 1,909 | 168 | 126 | 2,203 | | Insurance contract liabilities | 49,671 | (2,261) | 95,384 | 142,794 | | Accrued payroll | 1,863 | 408 | — | 2,271 | | Deductible losses | 12,355 | 26,099 | — | 38,454 | | Changes in fair value of the financial assets at fair value through profit or loss | 19,503 | (29,823) | — | (10,320) | | Changes in fair value of the financial assets at fair value through other comprehensive income | (62,540) | — | (74,788) | (137,328) | | Others | 1,670 | 702 | (567) | 1,805 | | **Net value** | **24,431** | **(4,707)** | **20,155** | **39,879** | **Unrecognised deductible tax losses** of the Group amounted to RMB1,650 million as at 31 December 2025 (as at 31 December 2024: RMB2,248 million), expected to mature within 5 years. --- # Notes to the Consolidated Financial Statements (continued) For the year ended 31 December 2025 ## 28 EARNINGS PER SHARE There is no difference between the basic and diluted earnings per share. The basic and diluted earnings per share for the year ended 31 December 2025 are calculated based on the net profit for the year attributable to ordinary equity holders of the Company and the weighted average of 28,264,705,000 ordinary shares (2024: same). ## 29 STOCK APPRECIATION RIGHTS The Board of Directors of the Company approved, on 5 January 2006, an award of stock appreciation rights of 4.05 million units and on 21 August 2006, another award of stock appreciation rights of 53.22 million units to eligible employees. The exercise prices of the two awards were HKD5.33 and HKD6.83, respectively, the average closing price of shares in the five trading days prior to 1 July 2005 and 1 January 2006, the dates for vesting and exercise price setting purposes of this award. Upon the exercise of stock appreciation rights, exercising recipients will receive payments in RMB, subject to any withholding tax, equal to the number of stock appreciation rights exercised times the difference between the exercise price and market price of the H shares at the time of exercise. Stock appreciation rights have been awarded in units, with each unit representing the value of one H share. No shares of common stock will be issued under the stock appreciation rights plan. According to the Company’s plan, all stock appreciation rights will have an exercise period of five years from the date of award and will not be exercisable before the fourth anniversary of the date of award unless specific market or other conditions have been met. On 26 February 2010, the Board of Directors of the Company approved the Proposal on Extension of the Effective Period of Stock Appreciation Rights to extend the exercise period of all stock appreciation rights, which is also subject to government policy. As at 31 December 2025, there were 55.01 million units outstanding and exercisable (as at 31 December 2024: same). As at 31 December 2025, the amount of intrinsic value for the vested stock appreciation rights was RMB1,028 million (as at 31 December 2024: RMB408 million). The fair value of the stock appreciation rights is estimated at each reporting date using lattice-based option valuation models based on expected volatility from 33% to 39%, an expected dividend yield of no higher than 4.70% and a risk-free interest rate ranging from 1.64% to 3.02%. The Company recognised a loss of RMB620 million in the net fair value through profit or loss in the consolidated comprehensive income representing the fair value change of the rights during the year ended 31 December 2025 (2024: The Company recognised a loss of RMB240 million in the net fair value through profit or loss in the consolidated comprehensive income representing the fair value change of the rights). RMB1,028 million and RMB13 million were included in salary and staff welfare payable included under other liabilities for the units not exercised and exercised but not paid as at 31 December 2025(as at 31 December 2024: RMB408 million and RMB13 million), respectively. There was no unrecognised compensation cost for the stock appreciation rights as at 31 December 2025 (as at 31 December 2024: same). --- # Notes to the Consolidated Financial Statements (continued) For the year ended 31 December 2025 ## 30 DIVIDENDS Pursuant to the shareholders' approval at the General Meeting on 26 June 2025, a final dividend of RMB0.45 (inclusive of tax) per ordinary share totalling RMB12,719 million in the respect of the year ended 31 December 2024 was declared and paid in 2025. The dividend has been reflected in the consolidated financial statements for the year ended 31 December 2025. Pursuant to the shareholders' approval at the First Extraordinary General Meeting on 25 September 2025, an interim dividend of RMB0.238 (inclusive of tax) per ordinary share totalling approximately RMB6,727 million in the respect of the six months ended 30 June 2025 was declared and paid in 2025. The dividend has been reflected in the consolidated financial statements for the year ended 31 December 2025. Pursuant to a resolution passed at the meeting of the Board of Directors on 25 March 2026, a final dividend of RMB0.618 (inclusive of tax) per ordinary share totalling approximately RMB17,468 million for the year ended 31 December 2025 was proposed for shareholders' approval at the forthcoming General Meeting. The dividend has not been recorded in the consolidated financial statements for the year ended 31 December 2025. ## 31 SIGNIFICANT RELATED PARTY TRANSACTIONS ### (a) Related parties with control relationship Information of the parent company is as follows: | Name | Location of registration | Principal business | Relationship with the Company | Nature of ownership | Legal representative | | :--- | :--- | :--- | :--- | :--- | :--- | | CLIC | Beijing, China | Insurance services including receipt of premiums and payment of benefits in respect of the in-force life, health, accident and other types of personal insurance business, and the reinsurance business; holding or investing in domestic and overseas insurance companies or other financial insurance institutions; fund management business permitted by national laws and regulations or approved by the State Council of the People's Republic of China; and other businesses approved by insurance regulatory agencies. | Immediate and ultimate holding company | State-owned | Cai Xiliang | --- # Notes to the Consolidated Financial Statements (continued) For the year ended 31 December 2025 ## 31 SIGNIFICANT RELATED PARTY TRANSACTIONS (continued) ### (b) Subsidiaries (i) The table below presents the basic information of the Company's subsidiaries as at 31 December 2025: | Name | Place of incorporation and operation | Percentage of equity interest held | Registered capital | Principal activities | | :--- | :--- | :--- | :--- | :--- | | AMC (i) | PRC | 60.00% directly | RMB4,000 million | Asset management | | China Life Pension Company Limited ("Pension Company") (i) | PRC | 74.27% directly and indirectly | RMB3,400 million | Pension and annuity | | China Life Franklin Asset Management Company Limited | Hong Kong, PRC | 50.00% indirectly | Not applicable | Asset management | | China Life (Suzhou) Pension and Retirement Investment Company Limited (i) | PRC | 100.00% directly and indirectly | RMB3,236 million | Investment in retirement properties | | CL AMP (i) | PRC | 85.03% indirectly | RMB1,288 million | Fund management | | Golden Phoenix Tree Limited | Hong Kong, PRC | 100.00% directly | Not applicable | Investment | | King Phoenix Tree Limited | The British Jersey Island | 100.00% indirectly | Not applicable | Investment | | China Life Wealth Management Company Limited (i) | PRC | 100.00% indirectly | RMB200 million | Asset management | | Shanghai Rui Chong Investment Co., Limited ("Rui Chong Company") (i) | PRC | 100.00% directly | RMB5,380 million | Investment | | New Aldgate Limited | Hong Kong, PRC | 100.00% directly | Not applicable | Investment | | Glorious Fortune Forever Limited | Hong Kong, PRC | 100.00% directly | Not applicable | Investment | | CL Hotel Investor, L.P. | USA | 100.00% directly | Not applicable | Investment | | Golden Bamboo Limited | The British Virgin Islands | 100.00% directly | Not applicable | Investment | | Sunny Bamboo Limited | The British Virgin Islands | 100.00% directly | Not applicable | Investment | | Fortune Bamboo Limited | The British Virgin Islands | 100.00% directly | Not applicable | Investment | | China Century Core Fund Limited | The British Cayman Islands | 100.00% indirectly | Not applicable | Investment | | China Life (Beijing) Health Management Co., Limited (i) | PRC | 100.00% directly | RMB1,530 million | Health management | --- # Notes to the Consolidated Financial Statements (continued) For the year ended 31 December 2025 # 31 SIGNIFICANT RELATED PARTY TRANSACTIONS (CONTINUED) ## (b) Subsidiaries (continued) (i) The table below presents the basic information of the Company’s subsidiaries as at 31 December 2025: (continued) | Name | Place of incorporation and operation | Percentage of equity interest held | Registered capital | Principal activities | | :--- | :--- | :--- | :--- | :--- | | China Life Franklin (Shenzhen) Private Equity Investment Fund Management Co., Limited (i) | PRC | 100.00% indirectly | RMB100 million | Investment | | Ningbo Meishan Bonded Port Area Guo Yang Guo Sheng Investment Partnership (“Guo Yang Guo Sheng”) (ii) | PRC | 89.997% directly | Not applicable | Investment | | New Capital Wisdom Limited | The British Virgin Islands | 100.00% indirectly | Not applicable | Investment | | New Fortune Wisdom Limited | The British Virgin Islands | 100.00% indirectly | Not applicable | Investment | | Wisdom Forever Limited Partnership | The British Cayman Islands | 100.00% indirectly | Not applicable | Investment | | Ningbo Meishan Bonded Port Area Bai Ning Investment Partnership (Limited Partnership) (ii) | PRC | 99.98% directly | Not applicable | Investment | | Shanghai Yuan Shu Yuan Pin Investment Management Partnership (Limited Partnership) (“Yuan Shu Yuan Pin”) (ii) | PRC | 99.98% directly | Not applicable | Investment | | Shanghai Yuan Shu Yuan Jiu Investment Management Partnership (Limited Partnership) (“Yuan Shu Yuan Jiu”) (ii) | PRC | 99.98% directly | Not applicable | Investment | | Dalian Hope Building Company Ltd. (i) | PRC | 100.00% indirectly | RMB340 million | Investment | | Shanghai Wansheng Industry Partnership (Limited Partnership) (ii) | PRC | 99.98% directly | Not applicable | Investment | | Wuhu Yuanxiang Tianfu Investment Management Partnership (Limited Partnership) (“Yuanxiang Tianfu”) (ii) | PRC | 99.98% directly | Not applicable | Investment | | Wuhu Yuanxiang Tianyi Investment Management Partnership (Limited Partnership) (“Yuanxiang Tianyi”) (ii) | PRC | 99.98% directly | Not applicable | Investment | | Xi’an Shengyi Jingsheng Real Estate Co., Ltd. (i) | PRC | 100.00% indirectly | RMB831 million | Investment | | Global Investors U.S. Investments I, LLC | USA | 99.99% directly | Not applicable | Investment | | China Life Guang De(Tianjin) Equity Investment Fund Partnership (Limited Partnership) (“CL Guang De”) (ii) | PRC | 99.95% directly | Not applicable | Investment | | Beijing China Life Pension Industry Investment Fund (Limited Partnership) (“CL Pension Industry”) (ii) | PRC | 99.90% directly | Not applicable | Investment | --- # Notes to the Consolidated Financial Statements (continued) For the year ended 31 December 2025 ## 31 SIGNIFICANT RELATED PARTY TRANSACTIONS (CONTINUED) ### (b) Subsidiaries (continued) (i) The table below presents the basic information of the Company’s subsidiaries as at 31 December 2025: (continued) | Name | Place of incorporation and operation | Percentage of equity interest held | Registered capital | Principal activities | | :--- | :--- | :--- | :--- | :--- | | China Life Qihang Phase I (Tianjin) Equity Investment Fund Partnership (Limited Partnership) (“CL Qihang Fund I”) (ii) | PRC | 99.99% directly | Not applicable | Investment | | Xing Wan (Tianjin) Enterprise Management Partnership (Limited Partnership) (ii) | PRC | 99.98% indirectly | Not applicable | Investment | | China Life Nianfeng Insurance Agency Co., Ltd. (i) | PRC | 90.81% directly | RMB544 million | Insurance agent | | China Life (Hangzhou) Hotel Co., Ltd. (i) | PRC | 99.99% indirectly | RMB65 million | Hotel management | | China Life Jiayuan (Xiamen) Health Management Company Limited (i) | PRC | 100% indirectly | RMB1,500 million | Health consultation | | China Life (Tianjin) Pension & Retirement Investment Company Limited (i) | PRC | 99.99% indirectly | RMB1,551 million | Investment management | | China Life (Qingdao) Health Management Co., Ltd. (i) | PRC | 99.50% indirectly | RMB211 million | Health management | | China Life Qinhuangdao Health and Elderly Care Service Co., Ltd. (i) | PRC | 100.00% indirectly | RMB33 million | Elderly care services | | Zhuhai Xinwan Real Estate Co., Ltd. (i) | PRC | 100.00% indirectly | RMB2,890 million | Real estate management | | China Life (Shenzhen)Health and Elderly Care Service Co., Ltd. (i) | PRC | 100.00% indirectly | RMB123 million | Elderly care services | | China Life (Beijing)Health and Elderly Care Service Co., Ltd. (i) | PRC | 99.99% indirectly | RMB1,170 million | Elderly care services | | China Life (Hangzhou)Health and Elderly Care Service Co., Ltd. (i) | PRC | 100.00% indirectly | RMB151 million | Elderly care services | | Zhuhai Linghang Kunpeng Equity Investment Fund Partnership (Limited Partnership) (ii) | PRC | 99.913% directly | Not applicable | Investment management | | China Life (Kunming)Health and Elderly Care Service Co., Ltd. (i) | PRC | 100.00% indirectly | RMB107 million | Elderly care services | | Beijing Xinyi Equity Investment Fund Partnership Enterprise (Limited Partnership) (ii) | PRC | 89.7197% indirectly | Not applicable | Investment management | | Beijing Yongsheng Enterprise Management Partnership (Limited Partnership) (ii) | PRC | 99.9965% indirectly | Not applicable | Management consulting | | Chongqing Shangshe Rhino Hotel Co., Ltd. (iii) | PRC | 100% indirectly | RMB86 million | Elderly care services | | China Life (Shijiazhuang) Health Management Co., Ltd. (iv) | PRC | 90.00% indirectly | RMB133 million | Health management | | China Life (Nanjing) Health and Elderly Care Service Co., Ltd. (iv) | PRC | 100% indirectly | RMB323 million | Health management | (i) The above subsidiaries are registered as limited companies in accordance of the Company Law of the People’s Republic of China. (ii) The above subsidiaries are registered as limited liability partnerships in accordance of the Law of the People’s Republic of China on Partnerships. (iii) The CL pension industry fund subsidiary acquired 100% equity of Chongqing Shangshe Rhino Hotel Co., Ltd., which was newly included in the consolidated scope in 2025. (iv) Newly established subsidiaries in 2025. Non-controlling interests in subsidiaries are not significant to the Company. --- # Notes to the Consolidated Financial Statements (continued) For the year ended 31 December 2025 ## 31 SIGNIFICANT RELATED PARTY TRANSACTIONS (continued) ### (b) Subsidiaries (continued) (ii) The table below presents the basic information of the Company’s major consolidated structured entities as at 31 December 2025: | Name | Percentage of shares held | Trust/investments received | Principal activities | | :--- | :--- | :--- | :--- | | CL Asset-Yuanliu No.2 Insurance Asset Management Product | 51.12% directly | RMB30,721 million | Investment management | | CL Asset-Yuanliu No.3 Insurance Asset Management Product | 48.18% directly | RMB25,999 million | Investment management | | China Life-Yunnan Guoqi Reform and Development Equity Investment Plan I | 100.00% directly | RMB14,000 million | Investment management | | China Life Investment – Eastern Air Group Equity Investment Plan | 100.00% directly | RMB11,000 million | Investment management | | China Life – Hu Fa No. 1 Equity Investment Plan | 99.15% directly | RMB10,767 million | Investment management | | Shan Guo Tou • Jing Tou Corporate Trust Loan Collective Funds Trust Scheme | 98.40% directly | RMB10,000 million | Investment management | | China Life-China Hua Neng Debt-to-Equity Swap | 100.00% directly | RMB10,000 million | Investment management | | Jiao Yin Guo Xin • China Aluminium Co., Ltd. Supply-side Reform Collective Fund Trust Scheme | 99.99% directly | RMB10,000 million | Investment management | | Jiao Yin Guo Xin • Jing Tou Corporate Collective Funds | 92.01% directly | RMB9,958 million | Investment management | | Guoshou Anbao Anji Pure Bond Semi-annual Open-end Bond Fund (Initiative) | Direct holding: 99.47%; indirect holding through CL AMP and its subsidiaries: 0.33% | RMB9,396 million | Investment management | | Zhong Hang Trust Fund • Tian Qi [2020] No.372 China Eastern Airlines Equity Instrument Investment Collective Fund Trust Scheme | 99.99% directly | RMB9,000 million | Investment management | | China Life Asset Management – Stable Green Medium & Short-term Bond Insurance Asset Management Product | Direct holding: 86.87%; indirect holding through AMC: 0.03% | RMB8,267 million | Investment management | | Jiang Su Trust • Xin Bao Sheng No.144 (Jing Tou) | 84.00% directly | RMB8,000 million | Investment management | | Zhong Hang Trust Fund • Tian Qi 21A No.155 China Eastern Airlines Perpetual Bonds Investment Collective Fund Trust Scheme | 99.38% directly | RMB8,000 million | Investment management | --- # Notes to the Consolidated Financial Statements (continued) For the year ended 31 December 2025 ## 31 SIGNIFICANT RELATED PARTY TRANSACTIONS (continued) ### (c) Other related parties | Significant related parties | Relationship with the Company | | :--- | :--- | | China Life Insurance (Overseas) Company Limited (“CL Overseas”) | Under common control of CLIC | | China Life Real Estate Co., Limited (“CLRE”) | Under common control of CLIC | | China Life Investment Management Company Limited (Formerly known as “China Life Investment Holding Company Limited”) (“CLI”) | Under common control of CLIC | | China Life Enterprise Annuity Fund (“EAP”) | A pension fund jointly set up by the Company and others | | China Life Property & Casualty Insurance Company Limited (“CLP&C”) | An associate of the Company | The major associates and joint ventures of the basic and important information is detailed in Note 10. ### (d) Transactions with significant related parties | Transactions with CLIC and its subsidiaries | Notes | For the year ended 31 December 2025 RMB million | For the year ended 31 December 2024 RMB million | | :--- | :---: | :---: | :---: | | **CLIC** | | | | | Distribution of dividends from the Company and AMC to CLIC | | 13,844 | 12,577 | | Policy management fee from CLIC | (i) | 449 | 457 | | Asset management fee from CLIC | | 158 | 110 | | **CLP&C** | | | | | Agency fee from CLP&C | (i) | 1,661 | 1,730 | | Dividends from CLP&C | | 234 | 167 | | Rental and a service fee from CLP&C | | 96 | 104 | | Asset management fee from CLIC | | 78 | 50 | | **CLI** | | | | | Payment of asset management fee to CLI | (i) | 471 | 566 | | **CL Overseas** | | | | | Asset management fee from CL Overseas | | 82 | 80 | | Transactions with associates and joint ventures | For the year ended 31 December 2025 RMB million | For the year ended 31 December 2024 RMB million | | :--- | :---: | :---: | | **CGB** | | | | Interest on deposits from CGB | 515 | 761 | | Dividends from CGB (Note 10) | 730 | 765 | | Commission expenses charged by CGB | 164 | 140 | | Rental fee from CGB | 161 | 163 | | Insurance Premiums | 136 | 96 | | **Other associates and joint ventures** | | | | Dividends from other associates and joint ventures (Note 10) | 4,404 | 4,396 | | Transaction with EAP | For the year ended 31 December 2025 RMB million | For the year ended 31 December 2024 RMB million | | :--- | :---: | :---: | | Contribution to EAP | 1,536 | 1,394 | --- # Notes to the Consolidated Financial Statements (continued) For the year ended 31 December 2025 ## 31 SIGNIFICANT RELATED PARTY TRANSACTIONS (continued) ### (d) Transactions with significant related parties (continued) For the year ended 31 December | Transactions between subsidiaries and the Company | Note | 2025 RMB million | 2024 RMB million | | :--- | :---: | :---: | :---: | | **Payment of asset management fee** | | | | | Payment to AMC | (i) | 4,646 | 3,701 | | **Dividends from subsidiaries** | | | | | Dividends from AMC | | 794 | 589 | | Dividends from Pension Company | | 313 | 171 | | **Rental received** | | | | | Rental from Pension Company | | 70 | 77 | | **Capital increase in subsidiaries** | | | | | Capital contribution to Glorious Fortune Forever Limited | | 6,959 | – | | Capital contribution to Golden Phoenix Tree Limited | | 3,559 | – | | Capital contribution to New Aldgate Limited | | 764 | – | | Capital contribution to CL Pension Industry Fund | | 1,292 | 1,532 | | Capital contribution to CL Qihang Fund I | | 360 | 2,931 | | Capital contribution to CL Guang De | | – | 166 | | **Capital reduction of subsidiaries** | | | | | Capital reduction to Guo Yang Guo Sheng | | 1,027 | – | | Capital reduction to CL Guang De | | 98 | – | | Capital reduction to Yuan Shu Yuan Pin | | 33 | 35 | | Capital reduction to Yuan Shu Yuan Jiu | | 33 | 35 | | Capital reduction to Yuanxiang Tianyi | | 20 | 22 | | Capital reduction to Yuanxiang Tianfu | | 20 | 22 | | Capital reduction to Ruichong Company | | – | 720 | For the year ended 31 December | Transactions between the consolidated structured entities and the Company | 2025 RMB million | 2024 RMB million | | :--- | :---: | :---: | | Distribution of profits from the consolidated structured entities to the Company | 18,851 | 22,488 | (i) These transactions constitute continuing connected transactions which are subject to reporting and announcement requirements but are exempt from independent shareholders’ approval requirements under Chapter 14A of the Listing Rules. The Company has complied with the disclosure requirements in accordance with Chapter 14A of the Listing Rules. --- # Notes to the Consolidated Financial Statements (continued) For the year ended 31 December 2025 ## 31 SIGNIFICANT RELATED PARTY TRANSACTIONS (continued) ### (e) Amounts due from/to significant related parties The following table summarises the balances due from and to significant related parties. The balances of the Group are all unsecured. The balances of the Group are non-interest-bearing and have no fixed repayment dates except for deposits with CGB, wealth management products and other securities of CGB. | Amounts due from and to related parties of the Group | As at 31 December 2025 (RMB million) | As at 31 December 2024 (RMB million) | | :--- | :---: | :---: | | Amount due from CLIC | 549 | 548 | | Amount due from CL Overseas | 177 | 142 | | Amount due from CLP&C | 323 | 316 | | Amount due to CLP&C | 84 | 76 | | Amount due to CLI | 530 | 461 | | Amount due from CLRE | 53 | 5 | | Amount deposited with CGB | 7,507 | 20,052 | | Wealth management products and other securities of CGB | 8,354 | 10,540 | | Amount due to CGB | 45 | 70 | | Amounts due from and to subsidiaries of the Company | As at 31 December 2025 (RMB million) | As at 31 December 2024 (RMB million) | | :--- | :---: | :---: | | Amount due from CL Hotel Investor, L.P. | 702 | 2,154 | | Amount due to AMC | 2,563 | 2,071 | | Amount due from Ruichong Company | 250 | 490 | ### (f) Key management personnel compensation | | For the year ended 31 December 2025 (RMB million) | For the year ended 31 December 2024 (RMB million) | | :--- | :---: | :---: | | Salaries and other benefits | 11 | 12 | The total compensation package for the Company’s key management personnel has not yet been finalised in accordance with regulations of the relevant PRC authorities. The compensation listed above is the tentative payment. --- # Notes to the Consolidated Financial Statements (continued) For the year ended 31 December 2025 ## 31 SIGNIFICANT RELATED PARTY TRANSACTIONS (continued) ### (g) Transactions with state-owned enterprises Under IAS 24 Related Party Disclosures, business transactions between state-owned enterprises controlled by the PRC government are within the scope of related party transactions. CLIC, the ultimate holding company of the Group, is a state-owned enterprise. The Group's key business is insurance and investment related and therefore the business transactions with other state-owned enterprises are primarily related to insurance and investment activities. The related party transactions with other state-owned enterprises are conducted in the ordinary course of business. Due to the complex ownership structure, the PRC government may hold indirect interests in many companies. Some of these interests may, in themselves or when combined with other indirect interests, be controlling interests which may not be known to the Group. Nevertheless, the Group believes that the following captures the material related party transactions and has applied IAS 24 exemption and disclosed only qualitative information. As at 31 December 2025, most of the bank deposits of the Group were with state-owned banks; the issuers of corporate bonds and subordinated bonds held by the Group were mainly state-owned enterprises. For the year ended 31 December 2025, a large portion of group insurance business of the Group were with state-owned enterprises; the majority of bancassurance commission shares were paid to state-owned banks and postal offices; and the majority of the reinsurance agreements of the Group were entered into with state-owned reinsurance companies (2024: same). ## 32 SHARE CAPITAL | | As at 31 December 2025 | As at 31 December 2025 | As at 31 December 2024 | As at 31 December 2024 | | :--- | :--- | :--- | :--- | :--- | | | **No. of shares** | **RMB million** | **No. of shares** | **RMB million** | | **Registered, authorised, issued and fully paid** | | | | | | Ordinary shares of RMB1 each | 28,264,705,000 | 28,265 | 28,264,705,000 | 28,265 | As at 31 December 2025, the Company's share capital is as follows: | | As at 31 December 2025 | As at 31 December 2025 | | :--- | :--- | :--- | | | **No. of shares** | **RMB million** | | Owned by CLIC (i) (i) All shares owned by CLIC are domestic listed shares. | 19,323,530,000 | 19,324 | | Owned by other equity holders | 8,941,175,000 | 8,941 | | Including: Domestic listed | 1,500,000,000 | 1,500 | | Overseas listed (ii) (ii) Overseas listed shares are traded on the Stock Exchange of Hong Kong Limited. | 7,441,175,000 | 7,441 | | **Total** | **28,264,705,000** | **28,265** | --- # Notes to the Consolidated Financial Statements (continued) For the year ended 31 December 2025 ## 33 RESERVES | (RMB million) | Share premium | Statutory reserve fund (a) | Discretionary reserve fund (b) | General reserve (c) | Others | Total | | :--- | :--- | :--- | :--- | :--- | :--- | :--- | | **As at 1 January 2024** | 53,905 | 66,187 | 54,539 | 64,229 | (73,165) | 165,695 | | Other comprehensive income | – | – | – | – | (56,770) | (56,770) | | Appropriation to reserves | – | – | 1,753 | 10,136 | – | 11,889 | | Other comprehensive income to retained earnings | – | – | – | – | (2,005) | (2,005) | | Others | – | – | – | – | 224 | 224 | | **As at 31 December 2024** | 53,905 | 66,187 | 56,292 | 74,365 | (131,716) | 119,033 | | **As at 1 January 2025** | 53,905 | 66,187 | 56,292 | 74,365 | (131,716) | 119,033 | | Other comprehensive income | – | – | – | – | (49,472) | (49,472) | | Appropriation to reserves | – | – | – | 15,300 | – | 15,300 | | Other comprehensive income to retained earnings | – | – | – | – | (3,894) | (3,894) | | Others | – | – | – | – | 370 | 370 | | **As at 31 December 2025** | 53,905 | 66,187 | 56,292 | 89,665 | (184,712) | 81,337 | (a) Pursuant to the relevant PRC laws, the Company appropriated 10% of its net profit under Chinese Accounting Standards (“CAS”) to statutory reserve fund. It may not be appropriated when the accumulated amount of the statutory reserve fund reaches more than 50% of the registered capital. Statutory reserve fund can be used to cover losses or increase share capital after approval. According to the approval of the Board of Directors, the Company did not appropriate statutory reserve fund in 2025 (2024: nil). (b) Approved at the Annual General Meeting on 26 June 2025, the Company appropriated no discretionary reserve fund from the net profit for the year ended 31 December 2024 (2024: RMB1,753 million). (c) Pursuant to “Financial Standards of Financial Enterprises – Implementation Guide” issued by the Ministry of Finance of the PRC on 30 March 2007, for the year ended 31 December 2025, the Company appropriated 10% of net profit under CAS which amounted to RMB15,064 million to the general reserve for future uncertain catastrophes, which cannot be used for dividend distribution or conversion to share capital increment (2024: RMB9,933 million). In addition, pursuant to the CAS, the Group appropriated RMB236 million to the general reserve of its subsidiaries attributable to the Company in the consolidated financial statements (2024: RMB203 million). Under related PRC law, dividends may be paid only out of distributable profits. Any distributable profits that are not distributed in a given year are retained and available for distribution in the subsequent years. --- # Notes to the Consolidated Financial Statements (continued) For the year ended 31 December 2025 ## 34 NOTES TO THE CONSOLIDATED STATEMENT OF CASH FLOWS ### Changes in liabilities arising from financing activities RMB million | | Interest-bearing loans and other borrowings | Bonds payable | Lease liabilities | Financial assets sold under agreements to repurchase | Other liabilities-payable to the third-party holders of consolidated structured entities | Total | | :--- | :---: | :---: | :---: | :---: | :---: | :---: | | **At 1 January 2024** | 12,857 | 36,166 | 1,255 | 216,851 | 84,295 | 351,424 | | Changes from financing cash flows | (831) | (1,498) | (1,074) | (68,743) | 12,133 | (60,013) | | Foreign exchange movement | (33) | – | – | – | – | (33) | | Changes arising from losing control of consolidated structured entities | – | – | – | (1,734) | – | (1,734) | | New leases | – | – | 1,133 | – | – | 1,133 | | Interest expense | 765 | 526 | 45 | 2,751 | – | 4,087 | | Others | – | – | (41) | 2,439 | – | 2,398 | | **At 31 December 2024** | 12,758 | 35,194 | 1,318 | 151,564 | 96,428 | 297,262 | | | | | | | | | | **At 1 January 2025** | 12,758 | 35,194 | 1,318 | 151,564 | 96,428 | 297,262 | | Changes from financing cash flows | (13,085) | (754) | (988) | 177,532 | 4,328 | 167,033 | | Foreign exchange movement | 256 | – | – | – | – | 256 | | Changes arising from losing control of consolidated structured entities | – | – | – | (2,035) | (39,846) | (41,881) | | New leases | – | – | 1,152 | – | – | 1,152 | | Interest expense | 127 | 755 | 37 | 3,145 | – | 4,064 | | Others | – | – | 20 | 1,657 | 998 | 2,675 | | **At 31 December 2025** | 56 | 35,195 | 1,539 | 331,863 | 61,908 | 430,561 | --- # Notes to the Consolidated Financial Statements (continued) For the year ended 31 December 2025 ## 35 PROVISIONS AND CONTINGENT LIABILITIES The following is a summary of the significant contingent liabilities: | | As at 31 December 2025 | As at 31 December 2024 | | :--- | :---: | :---: | | | **RMB million** | RMB million | | Pending lawsuits | **816** | 704 | The Group is involved in certain lawsuits arising from the ordinary course of business. In order to accurately disclose the contingent liabilities for pending lawsuits, the Group analyses all pending lawsuits on a case by case basis at the end of each interim and annual reporting period. A provision will only be recognised if management determines, based on third-party legal advice, that the Group has present obligations and the settlement of which is expected to result an outflow of the Group's resources embodying economic benefits, and the amount of such obligations could be reasonably estimated. Otherwise, pending lawsuits for which the amount of the liabilities can be estimated reliably are disclosed as contingent liabilities. As at 31 December 2025, the Group had other contingent liabilities but disclosure of such was not practical because the amounts of liabilities could not be reliably estimated and were not material in aggregate (as at 31 December 2024: same). ## 36 COMMITMENTS ### (a) Capital commitments The Group had the following capital commitments relating to property development projects and investments: | | As at 31 December 2025 | As at 31 December 2024 | | :--- | :---: | :---: | | | **RMB million** | RMB million | | **Contracted, but not provided for** | | | | Investments | **80,322** | 81,276 | | Property, plant and equipment | **1,078** | 1,280 | | **Total** | **81,400** | 82,556 | ### (b) Operating lease commitments As lessor, the future minimum rentals receivable under non-cancellable operating leases are as follows: | | As at 31 December 2025 | As at 31 December 2024 | | :--- | :---: | :---: | | | **RMB million** | RMB million | | Not later than one year | **830** | 857 | | Later than one year but not later than five years | **1,221** | 1,383 | | Later than five years | **142** | 267 | | **Total** | **2,193** | 2,507 | --- # Notes to the Consolidated Financial Statements (continued) For the year ended 31 December 2025 ## 37 STATEMENT OF FINANCIAL POSITION AND RESERVES OF THE COMPANY ### (a) Statement of financial position of the company | | As at 31 December 2025 | As at 31 December 2024 | | :--- | :---: | :---: | | | **RMB million** | **RMB million** | | **ASSETS** | | | | Property, plant and equipment | 46,632 | 47,810 | | Right-of-use assets | 1,490 | 1,388 | | Investment properties | 5,497 | 5,856 | | Investments in subsidiaries | 268,016 | 327,109 | | Investments in associates and joint ventures | 271,285 | 258,587 | | Term deposits | 372,258 | 344,382 | | Statutory deposits – restricted | 5,907 | 5,848 | | Investment in debt instruments at amortised cost | – | 8,683 | | Investment in debt instruments at fair value through other comprehensive income | 4,070,567 | 3,625,258 | | Investment in equity instruments at fair value through other comprehensive income | 296,439 | 146,523 | | Financial assets at fair value through profit or loss | 1,772,784 | 1,601,948 | | Reinsurance contract assets | 30,014 | 30,738 | | Other assets | 35,734 | 19,911 | | Deferred tax assets | 38,023 | 42,027 | | Financial assets purchased under agreements to resell | 48,215 | 25,414 | | Accrued investment income | 600 | 432 | | Cash and cash equivalents | 135,894 | 77,346 | | **Total assets** | **7,399,355** | **6,569,260** | --- # Notes to the Consolidated Financial Statements (continued) For the year ended 31 December 2025 ## 37 STATEMENT OF FINANCIAL POSITION AND RESERVES OF THE COMPANY (continued) ### (a) Statement of financial position of the company (continued) | LIABILITIES AND EQUITY | As at 31 December 2025 (RMB million) | As at 31 December 2024 (RMB million) | | :--- | :---: | :---: | | **Liabilities** | | | | Insurance contract liabilities | 6,376,114 | 5,825,026 | | Reinsurance contract liabilities | 312 | 160 | | Bonds payable | 35,195 | 35,194 | | Other liabilities | 40,379 | 38,190 | | Premiums received in advance | 48,227 | 28,760 | | Financial assets sold under agreements to repurchase | 311,657 | 134,463 | | **Total liabilities** | **6,811,884** | **6,061,793** | | **Equity** | | | | Share capital | 28,265 | 28,265 | | Reserves | 81,260 | 121,274 | | Retained earnings | 477,946 | 357,928 | | **Total equity** | **587,471** | **507,467** | | **Total liabilities and equity** | **7,399,355** | **6,569,260** | --- # Notes to the Consolidated Financial Statements (continued) For the year ended 31 December 2025 ## 37 STATEMENT OF FINANCIAL POSITION AND RESERVES OF THE COMPANY (continued) ### (b) Reserves | RMB million | Share premium | Statutory reserve fund | Discretionary reserve fund | General reserve | Others | Total | | :--- | :---: | :---: | :---: | :---: | :---: | :---: | | **As at 1 January 2024** | 53,360 | 66,139 | 54,539 | 62,975 | (69,506) | 167,507 | | Other comprehensive income | – | – | – | – | (56,172) | (56,172) | | Appropriation to reserves | – | – | 1,753 | 9,933 | – | 11,686 | | Other comprehensive income to retained earnings | – | – | – | – | (2,013) | (2,013) | | Others | – | – | – | – | 266 | 266 | | **As at 31 December 2024** | 53,360 | 66,139 | 56,292 | 72,908 | (127,425) | 121,274 | | **As at 1 January 2025** | 53,360 | 66,139 | 56,292 | 72,908 | (127,425) | 121,274 | | Other comprehensive income | – | – | – | – | (51,571) | (51,571) | | Appropriation to reserves | – | – | – | 15,064 | – | 15,064 | | Other comprehensive income to retained earnings | – | – | – | – | (3,891) | (3,891) | | Others | – | – | – | – | 384 | 384 | | **As at 31 December 2025** | 53,360 | 66,139 | 56,292 | 87,972 | (182,503) | 81,260 | --- # Notes to the Consolidated Financial Statements (continued) **For the year ended 31 December 2025** ## 38 DIRECTORS', CHIEF EXECUTIVE'S AND SENIOR MANAGEMENT'S REMUNERATION The total compensation package for the directors, chief executive and senior management for the year ended 31 December 2025 in accordance with the related measures for compensation management of the Company has not yet been finalised. The amount of the compensation not provided for is not expected to have a significant impact on the Group’s 2025 consolidated financial statements. The final compensation will be disclosed in a separate announcement when determined. ### (a) Directors’ and chief executive’s emoluments The aggregate amounts of emoluments paid to directors and chief executive of the Company for the year ended 31 December 2025 are as follows: | Name | Remuneration paid | Benefits in kind | Pension scheme contributions | Total | | :--- | :--- | :--- | :--- | :--- | | **RMB thousand** | | | | | | Cai Xiliang (i) | – | – | – | – | | Li Mingguang (ii) | – | – | – | – | | Liu Hui | 1,253.0 | 169.1 | 201.3 | 1,623.4 | | Ruan Qi | 1,253.0 | 166.2 | 182.9 | 1,602.1 | | Wang Junhui (iii) | – | – | – | – | | Hu Jin (iii) | – | – | – | – | | Hu Rong (iii) | – | – | – | – | | Niu Kailong (iv) | – | – | – | – | | Lin Zhiquan | 420.0 | – | – | 420.0 | | Zhai Haitao | 420.0 | – | – | 420.0 | | Chen Jie | 420.0 | – | – | 420.0 | | Lu Feng | 420.0 | – | – | 420.0 | (i) Cai Xiliang was appointed as the chairman and executive director in December 2024 and did not receive remuneration from the Company. (ii) Li Mingguang did not receive remuneration from the Company from May 2023. (iii) Wang Junhui, Hu Jin and Hu Rong are non-executive directors and do not receive remuneration from the company. (iv) Niu Kailong was appointed as a non-executive director in August 2025 and did not receive remuneration from the company. (v) The above remuneration was calculated based on the relevant employment period during the reporting period. --- # Notes to the Consolidated Financial Statements (continued) For the year ended 31 December 2025 ## 38 DIRECTORS', CHIEF EXECUTIVE'S AND SENIOR MANAGEMENT'S REMUNERATION (continued) ### (a) Directors' and chief executive's emoluments (continued) The aggregate amounts of emoluments paid to directors and chief executive of the Company for the year ended 31 December 2024 are as follows: | Name | Basic salaries | Performance related bonuses | Subtotal of salary income | Deferred payment included in salary income | Benefits in kind | Pension scheme contributions | Total | Deferred payment included in total | Actual paid included in total | | :--- | :---: | :---: | :---: | :---: | :---: | :---: | :---: | :---: | :---: | | | **RMB thousand** | | | | | | | | | | Cai Xiliang (i) | — | — | — | — | — | — | — | — | — | | Bai Tao (ii) | — | — | — | — | — | — | — | — | — | | Li Mingguang (iii) | — | — | — | — | — | — | — | — | — | | Liu Hui (iv) | 730.9 | — | 730.9 | — | 97.6 | 116.9 | 945.4 | — | 945.4 | | Ruan Qi (iv) | 730.9 | — | 730.9 | — | 96.5 | 106.1 | 933.5 | — | 933.5 | | Wang Junhui (v) | — | — | — | — | — | — | — | — | — | | Zhuo Meijuan (vi) | — | — | — | — | — | — | — | — | — | | Hu Jin (vi) | — | — | — | — | — | — | — | — | — | | Hu Rong (vi) | — | — | — | — | — | — | — | — | — | | Lin Zhiquan | 420.0 | — | 420.0 | — | — | — | 420.0 | — | 420.0 | | Zhai Haitao | 420.0 | — | 420.0 | — | — | — | 420.0 | — | 420.0 | | Huang Yiping (vii) | 385.0 | — | 385.0 | — | — | — | 385.0 | — | 385.0 | | Chen Jie | 420.0 | — | 420.0 | — | — | — | 420.0 | — | 420.0 | | Lu Feng (vii) | 35.0 | — | 35.0 | — | — | — | 35.0 | — | 35.0 | (i) Cai Xiliang was appointed as the chairman and executive director in December 2024 and did not receive remuneration from the Company. (ii) Bai Tao ceased to serve as the chairman and executive director of the Company in October 2024. (iii) Li Mingguang did not receive remuneration from the Company from May 2023. (iv) Liu Hui and Ruan Qi were appointed as executive directors of the Company in May 2024. (v) Wang Junhui is a non-executive director and does not receive remuneration from the company. (vi) Hu Jin and Hu Rong were appointed as non-executive directors of the Company in November 2024; Zhuo Meijuan ceased to serve as a non-executive director of the Company in June 2024. (vii) Lu Feng was appointed as an independent non-executive director of the Company in November 2024; Huang Yiping ceased to serve as an independent non-executive director of the Company in November 2024. (viii) The above remuneration was calculated based on the relevant employment period during the reporting period, and there is no performance remuneration recovery and deduction in 2024. The total remuneration for the year 2024 for the Company’s directors, chief executive and senior management has not yet been finalized. The directors and chief executive received the compensation amounts disclosed above during their term of office in 2025 and 2024. In addition to the directors’ emoluments disclosed above, certain directors of the Company received emoluments from CLIC, the amounts of which were not apportioned between their services to the Company and their services to CLIC. --- # Notes to the Consolidated Financial Statements (continued) For the year ended 31 December 2025 ## 38 DIRECTORS’, CHIEF EXECUTIVE’S AND SENIOR MANAGEMENT’S REMUNERATION (continued) ### (b) Five highest paid individuals Details of the remuneration of the five highest paid individuals are as follows: | | For the year ended 31 December 2025 (RMB thousand) | For the year ended 31 December 2024 (RMB thousand) | | :--- | :---: | :---: | | Basic salaries, housing allowances, other allowances and benefits in kind | 6,392.6 | 6,601.4 | | Pension scheme contributions | 839.5 | 878.0 | | **Total** | **7,232.1** | **7,479.4** | The emoluments fell within the following bands: | Number of individuals | For the year ended 31 December 2025 | For the year ended 31 December 2024 | | :--- | :---: | :---: | | RMB0 – RMB1,000,000 | – | – | | RMB1,000,001 – RMB2,000,000 | 5 | 5 | | RMB2,000,001 – RMB3,000,000 | – | – | For the year ended 31 December 2025, no emoluments were paid by the Company to the directors, chief executive or any of the five highest paid individuals as an inducement to join or upon joining the Company or compensation for loss of office as a director of any member of the Group or of any other office in connection with the management (2024: nil). The emoluments of the five highest paid individuals are the total emoluments paid to them during the year. There was no arrangement under which a director, chief executive waived or agreed to waive any remuneration during the year. --- In case of any discrepancy between the Chinese version and the English version of this report, the Chinese version shall prevail; in case of any discrepancy between the printed version and the website version of this report, the website version shall prevail. --- # 中国人寿保险股份有限公司 (China Life Insurance Company Limited) **MIX** Paper | Supporting responsible forestry FSC® C008061 www.fsc.org - **Office Address:** 16 Financial Street, Xicheng District, Beijing, P.R. China - **Telephone:** 86-10-63633333 - **Website:** www.e-chinalife.com - **E-mail:** ir@e-chinalife.com