The insurance industry is witnessing a significant acceleration in the closure of branches in 2025. According to data from the Financial Regulatory Administration’s insurance license query system, a total of 946 insurance company branches across the country were approved for revocation in the first five months of 2025. In contrast, only 163 new branches were established during the same period, indicating a substantial net decrease in the number of industry institutions.
Major Players Leading the Way
Taikang Life Insurance has emerged as one of the most active companies in this round of “slimming down.” The company has closed 178 branches within the year, including various types such as central branch companies, branch companies, and marketing service departments. Taikang Life Insurance stated that this move aligns with the background of urbanization upgrading and industry transformation. The goal is to optimize the network layout of its branches in third – and fourth – tier cities and below, focusing on core customer groups and enhancing operational efficiency.
Foreign Insurers Also Adjusting
Foreign insurance companies are also making strategic adjustments. In March 2025, Starr Insurance was approved to dissolve its Chongqing and Hubei branches. This continues its strategy of closing several provincial branches in 2022. Currently, the number of provincial branches of Starr Insurance has been reduced to six. Dong Ying, the chairperson of Starr Property & Casualty Insurance, emphasized that the company adopts a light – asset development strategy, focusing on cooperation with domestic insurers to leverage their respective strengths rather than blindly expanding its branch network.
Factors Driving the “Slimming Down”
Industry insiders analyze that the continuous “slimming down” is driven by multiple factors. The limited market capacity in some regions, especially third – and fourth – tier cities and below, makes business expansion challenging. Rising labor and management costs, combined with low operational efficiency in some branches, have forced insurance companies to optimize resource allocation. Fierce industry competition has also prompted insurers to close inefficient branches to enhance their overall competitiveness. Additionally, the rapid development of online business has significantly reduced reliance on physical outlets. The “2024 China Internet Insurance Consumer Insight Report” shows that the online insurance purchase rate rose to 78% in 2024, surpassing the offline insurance purchase rate (79%) for the first time. The application of AI technology throughout the insurance consumption process is becoming increasingly widespread.
Irreplaceable Value of Offline Outlets
Despite the rapid growth of online channels, experts generally believe that offline outlets still play an irreplaceable role in providing complex product consultations, personalized services, and building customer trust.
Future Outlook
Driven by both digital transformation and market competition, the trend of insurance companies closing inefficient branches to “slim down” and optimize their operations is expected to continue. The closure of nearly a thousand branches in 2025 is part of this long – term trend. Looking ahead, the deep integration and complementarity of online and offline channels will be the main direction for the development of service models in the insurance industry.
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