Insurance 315 | Deposit Receipts Turning into Insurance Policies - Two Sides of the Coin: New Market Opportunities and Sales Misconduct Concerns in Savings Insurance

[Global Network Insurance Report by Feng Chaonan] Currently, deposit interest rates are entering a downward trend, coupled with hundreds of trillions of yuan in fixed-term deposits maturing simultaneously, presenting investors with a clear “multiple-choice question” regarding wealth allocation.

Against this backdrop, insurance products that combine long-term protection with stable returns meet the core needs of low- to medium-risk preference groups for asset safety and steady income. Especially dividend insurance, with its “guaranteed benefits + floating dividends” structure, not only locks in basic returns but also offers the potential for excess gains.

(图/东方IC)

The market trend is now clear: bank fixed-term deposits are shifting toward the insurance market.

However, opportunities come with challenges. Today, the bancassurance channel’s role in insurance sales is gradually increasing, but irregular practices in sales are also emerging, such as misleading “deposit to policy” sales.

So, how can consumers stay alert and make rational choices? How should financial institutions strengthen compliance and build a healthy, sustainable sales system?

01 Deposit Maturity Meets Falling Interest Rates, Savings Insurance Shows Its Advantages

In January this year, the “deposit maturity wave” became a hot topic in the market. Several analysis agencies estimated the scale of deposits maturing in 2026. Although their methodologies differ and results vary, the overall consensus is that the total amount of residents’ maturing deposits will reach hundreds of trillions of yuan, regarded by the market as a “massive scale.”

Today, relying solely on deposits is no longer sufficient for many investors seeking steady asset growth, mainly because interest rates continue to decline. For example, a major state-owned bank’s app shows that the interest rates for large-denomination certificates of deposit for 1, 2, and 3 years are 1.2%, 1.2%, and 1.55%, respectively. With rates dropping into the “single digits,” many investors are seeking new tools to allocate their funds.

Long-term fixed income savings insurance has become a key option for “moving funds away from deposits.”

Furthermore, the question of “where deposits go” is closely related to investors’ returns. Although the guaranteed interest rate for personal insurance products was lowered last September, ordinary products still offer around 2%, while dividend products guarantee above 1.75% and can also enjoy floating returns. From this perspective, savings-type insurance has clear allocation advantages.

Moreover, the bancassurance channel benefits from the bank’s customer base and account systems, providing favorable conditions for accepting low-risk funds.

According to Lin Xianping, associate professor at Zhejiang University City College and executive deputy secretary-general of the China Urban Experts Think Tank, consumers should rationally allocate insurance. Suitable groups include those pursuing long-term stability, retirement and education planning, and willing to lock in funds; those with large short-term expenses, tight cash flow, or high liquidity dependence should be cautious. “Consumers should remember: insurance is not a deposit. The dividends beyond guaranteed benefits are not promises, and early surrender may result in losses.”

02 Lawyers: Concealing Insurance Attributes Violates Consumers’ Right to Know

As residents’ asset allocation faces restructuring and transfer, insurance companies are presented with new business opportunities. The bancassurance channel has become the core driver of new premium growth. However, some sales practices still have prominent issues, such as blurring the fundamental differences between deposits and insurance products and downplaying the long-term capital lock-in features.

On a third-party complaint platform, a Global Network reporter found numerous complaints from users about misleading “deposit to policy” sales when searching for “deposit” and “insurance” keywords.

Notably, the “Measures for the Management of Suitability of Financial Products,” effective since February this year, stipulate that financial institutions must not provide false, misleading, or significantly incomplete information during product promotion, sales, or transactions. This includes avoiding confusion between deposits, wealth management, funds, trusts, and insurance, and prohibiting false promises of capital protection or guaranteed returns, as well as exaggerated claims about product yields or guarantees.

Li Ya, partner at Zhongwen Law Firm, told reporters that sales personnel calling insurance products “high-interest deposits,” “new financial management,” or “capital-protected” while deliberately concealing their insurance nature infringes on consumers’ right to information. Such behavior constitutes false, fraudulent, misleading, or concealment advertising, violating the “Administrative Measures for the Agency Sale of Banking Products,” which regulate bank-distributed insurance.

“Senior citizens and other groups with limited financial knowledge are key targets for regulation. For those over 65, enhanced protections and ‘double recording’ procedures are necessary,” Li Ya said. She recommends banks use paper-based ‘double recording’ notices, with consumers verbally confirming and signing for policies; for large certificates of deposit converted into policies, adult children should verify and sign. When consumers encounter misleading practices like “deposit to policy,” they should first negotiate with the bank or insurance company to cancel the policy and recover principal plus reasonable interest; they can also report to regulators, pointing out fraud or misguidance, and supervise the refund process. If negotiations and complaints fail, they can file a lawsuit to revoke the policy signed under fraudulent circumstances.

Lin Xianping suggests that resolving the chaos of “deposit to policy” conversions requires multi-party cooperation. Institutions must bear sales responsibilities, honestly inform, avoid exaggeration and misguidance; consumers should remain rational, keep sufficient reserve funds, plan long-term, and use the cooling-off period to reconsider. “In the wave of wealth transformation, the insurance industry should stay true to its original purpose. Only by returning to protection, standardizing operations, and maintaining compliance can the industry achieve high-quality development, allowing consumers to buy with confidence, hold with peace of mind, and protect their rights—achieving a win-win situation for wealth allocation and rights protection.”

According to a responsible person from Sunshine Insurance, for insurers, establishing a product, channel, and customer “three-in-one” suitability management system is key to achieving precise matching of “needs-products-services” and effectively safeguarding consumers’ legal rights.

This person emphasized that in practice, three aspects should be prioritized: First, at the product level, strictly follow regulatory requirements, conduct scientific product classification based on consumer protection needs, and consider product complexity and policy benefit variability to reasonably categorize risk levels from low to high, ensuring product offerings match consumers’ risk tolerance.

Second, at the channel level, promote “system and process upgrades” to solidify the “1+N” suitability management system. This includes strictly managing agent qualifications, strengthening compliance review, and developing systems aligned with procedures. Continuous training and education should be provided to agents to enhance their compliance awareness and ability to protect consumer rights, turning suitability requirements into practical business measures.

Third, at the client level, continuously strengthen financial education and publicity, guide consumers to understand their needs deeply, make cautious decisions, and choose financial products that match their risk capacity. Improving financial literacy and risk awareness is essential to build a solid foundation for consumer rights protection.