Breaking the myth that "one person's disability causes the whole family to fall out of balance," insurance companies compete to explore a new blue ocean in the silver economy

Source: Economic Information Daily

“Once one person becomes unable to care for themselves, the whole family becomes unbalanced.” — These words express the bitter reality faced by countless families, and as China’s population aging accelerates, they are becoming more and more common in everyday life. As an important institutional arrangement to address this dilemma, long-term care insurance is being rolled out nationwide. In this process, commercial insurance institutions are leveraging professional advantages such as actuarial science, risk control, and service networks to seize early opportunities in this new blue ocean of the silver-economy.

China Life disclosed at its 2025 annual results briefing that since 2016, the company has successively participated in more than 70 long-term care insurance pilot projects. “China Life will, with a responsible corporate attitude, high-quality service supply, and professional operational management, actively contribute China Life’s strength to the steady and orderly implementation of long-term care insurance.” said Hou Jin, Assistant to the President and Chief Actuary of the company.

China Life’s practice is a microcosm of how insurance institutions deeply participate in handling long-term care insurance operations. In the field of policy-based long-term care insurance, regions have generally established a new cooperation mechanism of “government handling as the foundation, and social forces as a supplement,” using a separation model in which the healthcare insurance department oversees administration and commercial insurance companies undertake business, with functions separated between administration and operation. Taking China Life’s Jiangsu Branch as an example, it has handled 23 long-term care insurance projects across the province, covering nearly 11 million people. Property & Casualty Insurance Company of the People (PICC P&C) has, on the basis of participating in long-term care insurance pilot city projects in 32 countries, further expanded policy-based supplementary nursing insurance projects for difficult groups across multiple local civil affairs departments, initially building a multi-tier care protection system.

There are mainly two paths for insurance institutions to participate in long-term care insurance: one is the operation and service model, providing full-process services such as disability assessment, expense review, and settlement payments; the other is the product supplementation model, developing commercial long-term care insurance as a bridge to social security. However, alongside deep participation, commercial insurance institutions also face challenges such as insufficient operational sustainability and failure to fully implement the no-loss and low-profit principle. Zhou Yanfei, Director of the Strategic Research Center of China Taiping (PICC Group), suggests that reference be made to the mature experience of urban and rural residents’ critical illness insurance: implement preferential policies such as tax exemptions for insurance institutions that undertake long-term care insurance, and separate long-term care insurance into separate accounts, separate accounting, separate performance evaluation, and separate regulation, thereby achieving strict separation between policy-based business and commercial insurance business.

If the sustainability of the operation model is an “internal cycle” issue in institutional functioning, then quality control is the “last mile” determining whether long-term care insurance can truly benefit the disabled care-needing population. Given China’s national condition that “more than 90% of elderly people choose to age at home,” multiple large insurance companies have vigorously developed at-home and on-site nursing services. By training and standardizing teams of caregivers, they provide regular services for people with disabilities in care, and supplement with equipment such as smart nursing beds and anti-bedsores mattresses to ease the burden of family caregiving.

However, since the service chain involves multiple parties such as commercial insurance companies, assessment institutions, and nursing service providers, the difficulty of quality control is relatively high. Previously, cases have already emerged in which fraudulent settlements were used to obtain healthcare funds. Gao Chengyuan, Deputy Secretary-General of the Guangdong Social Policy Research Association, said that disability assessment standards are not unified and fraud and abuse of reimbursements occur frequently. There is an urgent need to formulate national-level assessment standards and use technologies such as intelligent wearables and remote monitoring to enable end-to-end digital traceability. In terms of breakthroughs in implementation, reference can be made to Zhejiang’s “co-insurance body” experience: multiple insurance companies jointly undertake to share dispersed risks, forming a new governance pattern of “the government sets the rules, the market provides services, and insurance controls risks.”

In the face of challenges on the operations side, insurance institutions are shifting from being mere “operators” to “ecosystem builders,” extending their reach to innovation in commercial long-term care insurance products and the integration of care-and-living (wellness and elderly care) services. The reporter noted that currently, some domestic insurance companies have been actively trying commercial long-term care insurance. In addition to insurance benefit payouts, they also offer a variety of service entitlements such as outpatient appointment scheduling, accompaniment to appointments, at-home care assessment, at-home care coordination, care-and-living hardware (including guidance), rehabilitation and nutrition guidance, coordination of long-term care institutions for the care-needing, and other services, expanding from plain monetary compensation to full-process care support.

A relevant person in charge from Taiping Life Insurance stated that the policy-based long-term care insurance is positioned to “cover the basics widely” to achieve a safety-net role, but the needs of care-needing elderly people for high-quality, personalized care protection and care demand are growing day by day—this is precisely the space for commercial long-term care insurance to make efforts. Taiping Life Insurance has launched a series of commercial long-term care insurance products, with higher coverage amounts and more flexible designs, which can effectively disperse the risk of “once one person becomes unable to care for themselves, the whole family becomes unbalanced.”

Industry insiders generally believe that as long-term care insurance gradually moves toward universal coverage, in the future insurance institutions should not only be payers, but also builders of the care-and-living ecosystem. Insurance institutions can jointly set up full-process management systems with housekeeping companies, elderly care institutions, community service centers, and so on, and take the lead in formulating service standards and operating procedures. At the same time, they can explore the application of age-friendly technology products such as fall-prevention equipment and remote monitoring, which not only reduces the workload of caregivers but also improves care safety and efficiency.

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Responsible editor: Cao Ruitong