China Life overhauls investment strategy amidst risk pressures

New systems connect capital allocation with long-term policyholder liabilities.

China Life (Overseas) Company Limited is overhauling its investment management framework to integrate risk, capital and liability management as market volatility and regulatory changes reshape Hong Kong’s insurance sector.

“Insurance investment is an asset-liability management discipline. We are not managing an isolated investment portfolio,” Kang Le, Vice President of China Life (Overseas), said at the Asian Banking & Finance and Insurance Asia summit in Hong Kong on 5 November.

The executive said insurers must consider how investment returns support their obligations to policyholders rather than focus solely on which assets offer the highest returns. The challenge comes as Hong Kong's insurance market continues to expand.

According to provisional statistics released by the Hong Kong Insurance Authority in October 2026, total gross insurance premiums increased 35.5% year-on-year to HK$573.6b in the first half of 2026. New premiums for long-term insurance business, excluding retirement schemes, rose 58.4% to HK$275.2b, reflecting strong demand for life insurance and related products.

Hong Kong's risk-based capital regime, introduced in July 2024, has also changed how insurers assess their investments. The framework links capital requirements more closely to an insurer's risk exposure, asset-liability matching and product mix.

In May 2026, the Insurance Authority announced further proposed enhancements aimed at encouraging infrastructure investment whilst maintaining safeguards for insurers' financial stability. The regulator targeted implementation by 31 December 2026.

China Life Overseas has been restructuring its investment management approach since 2024 through its FVII strategy, which focuses on four areas: foundation, valuation, innovation and integration, Kang said.

The strategy is supported by the company's SPIRE investment management framework, comprising five principles: strategy-led, portfolio-based, interactive, return feedback and ecosystem. Under this framework, the insurer connects long-term asset allocation decisions with market research, portfolio management and performance evaluation.

The company receives research and market information from international asset managers but retains responsibility for developing its own assessment of economic conditions, asset classes, sectors and investment opportunities.

This allows China Life Overseas to compare external recommendations with its own investment objectives before implementing portfolio changes.

Kang said the broader objective is moving beyond being an excellent investment team towards becoming an excellent investment organisation.

Alongside its investment framework, China Life Overseas is developing digital systems to consolidate data and improve oversight of its portfolios. The company previously introduced Project Galaxy to standardise investment data and integrate asset management processes.

It has since launched Project Star River, an investment management platform intended to connect investment decisions with insurance liabilities and external manager oversight.

“We do not see Project Star River as merely another traditional IT system. Rather, we see it as an integrated investment management platform designed to support better investment decision-making,” Kang said.

Kang also said Hong Kong's established financial infrastructure, professional services industry and regulatory framework support its role in cross-border insurance investment.

“Hong Kong is also a platform that connects the Chinese mainland with global capital markets,” Kang said.

Looking ahead, China Life Overseas expects competition amongst insurers to depend increasingly on their ability to integrate investment expertise, technology and risk management.

The executive said the industry is moving away from managing individual asset portfolios towards managing interconnected investment, capital, liability and data systems.

“In my view, future competition belongs to institutions that build resilient, agile, and digital-enabled long-term investment capabilities that are better able to adapt to the changing global market environment,” Kang said.