The auto insurance landscape in 2025 presents a compelling contrast. On one side, the traditional auto insurance market continues to cool, with industry-wide premiums reaching 940.873 billion yuan, a year-on-year growth of only 2.98%. On the other side, internet-based auto insurance is booming, generating 53.16 billion yuan in premiums and maintaining a growth rate above 30% for three consecutive years.
This divergence signals a notable shift in the growth drivers of the auto insurance sector. In the United States, Progressive Insurance, a pioneer of internet auto insurance, took three decades to surpass the traditional industry leader. Domestically, the auto insurance market has not experienced significant reshuffling for over a decade, prompting industry participants to question whether overtaking the incumbents is still possible, and who might emerge as China's answer to Progressive.
The Insurance Association of China recently released its analysis report on internet insurance business for property insurers in 2025. The findings reveal that the internet auto insurance market has undergone substantial transformation compared to previous years. In this rapidly expanding market favored by younger consumers, the competitive dynamics remain fluid, and the impressive premium growth figures may hold the key to the next wave of transformation in auto insurance.
Internet Auto Insurance Surges 30% for Third Straight Year, Ping An Commands Over 35% Market Share
As growth in traditional auto insurance plateaus, internet auto insurance continues to deliver remarkable results. The report shows that internet auto insurance premiums have maintained year-on-year growth above 30% for three consecutive years. In 2025, cumulative premiums reached 53.16 billion yuan, a 33.9% increase, outpacing the overall auto insurance industry growth rate by 31 percentage points. The penetration rate of internet auto insurance jumped from 4.3% to 5.6%.
The report attributes this sustained high growth to four key factors. First, regulatory standardization has compressed cost competition in offline channels, amplifying the advantages of internet auto insurance in customer acquisition and compliance. Second, the rise of new energy vehicles, which accounted for 47.9% of new car sales in 2025, has brought younger owners naturally inclined toward online purchasing and policy management. Third, enhanced online experiences, including industry-wide platform initiatives and improved claims services, have streamlined the digital journey. Fourth, insurers are increasingly prioritizing internet-based auto insurance in their strategic planning.
Internet auto insurance has become the primary engine driving growth in the broader internet property insurance sector. Between 2022 and 2025, the share of auto insurance within internet property insurance rose for four consecutive years, from 16.9% to 28.8%. In 2025 alone, auto insurance contributed 13.47 billion yuan in incremental premiums, the highest among all internet insurance categories.
The market structure mirrors the high concentration seen in traditional auto insurance. In 2025, the top five insurers held a combined 77.3% market share in internet auto insurance, with the "big three" accounting for 65.02%. Notably, the ranking among the big three differs from the traditional order. Ping An Insurance (Group) Company Of China, Ltd. (601318) has emerged as the scale leader, generating 18.99 billion yuan in internet auto insurance premiums with a 35.73% market share—nearly double that of the second-place player and equivalent to the combined total of the next three insurers. Ping An's early commitment to telemarketing auto insurance in 2009 helped it surpass competitors, and by 2013 it had launched its own online platform, leveraging high-frequency lifestyle services to drive policy sales.
BYD Overtakes China Life to Claim Sixth Place, Yet Underwriting Profitability Remains Elusive
While Ping An Insurance (Group) Company Of China, Ltd. (601318) maintains its leading position, a new entrant has captured attention from an incremental growth perspective. Among the 13.47 billion yuan in premium growth for 2025, Ping An contributed 4.72 billion yuan, and The People'S Insurance Company (Group) Of China Limited (601319) added 3.41 billion yuan. The third-largest contributor was not one of the traditional giants but Byd Company Limited (002594)'s insurance arm, which added 1.35 billion yuan. Together, these three accounted for over 70% of the total premium growth in internet auto insurance.
BYD's insurance entity, which began full operations in 2025 after being acquired from a distressed insurer in 2023, generated 2.7 billion yuan in internet auto insurance premiums, capturing 5.09% of the market and ranking sixth, slightly ahead of China Life and just 60 million yuan behind the fifth-place insurer. The company remains in an expansion phase, having recently received approval to operate in three additional provinces, bringing its coverage to ten provinces nationwide.
BYD's growth trajectory diverges sharply from traditional insurers. Its latest solvency report shows that all 1.42 billion yuan in signed premiums during the first half of 2026 came from direct sales channels. This direct-to-consumer model has driven its expense ratio down to 4.26% in the second quarter of 2026, with commission costs at zero—figures virtually unattainable for traditional insurers. Leveraging over 4 million new energy vehicles sold annually by the parent company, BYD's insurance arm integrates directly into the car ownership lifecycle, achieving near-zero customer acquisition costs. Moreover, access to vehicle performance and battery data enables more precise pricing and risk management.
Despite eliminating intermediary costs, BYD's insurance operations still face underwriting losses. As of the second quarter of 2026, its combined loss ratio stood at 96.97%, well above the industry average, with a combined ratio of 101.23%—still above the breakeven threshold. This profitability challenge is shared across the industry, as the rapid growth in internet auto insurance is largely driven by new energy vehicles, which suffer from higher accident rates and loss ratios compared to traditional vehicles. The fastest-growing segment is also the most difficult to make profitable, as the report notes that emerging businesses like new energy vehicle insurance continue to struggle with risk control, pricing accuracy, and operational costs.
Insurer-Owned Digital Platforms Dominate as Primary Channel, Contributing Over 45% of Premiums
The rapid growth of internet auto insurance reflects a fundamental shift in consumer behavior. Industry surveys indicate that nearly 60% of internet insurance consumers have migrated from offline channels, with auto insurance ranking as the most frequently switched product. More profound changes are occurring at the distribution level, where channel structures directly reveal the evolving relationship between insurers and consumers.
In 2025, insurer-operated digital platforms generated 24.06 billion yuan in internet auto insurance premiums, accounting for 45.3% of the total and making them the largest channel. Professional agency channels contributed 21.82 billion yuan, or 41%, while broker channels added 4.87 billion yuan, or 9.2%. Together, self-operated platforms and professional agencies accounted for over 86% of all internet auto insurance premiums.
This channel structure challenges the common perception that internet insurance relies primarily on third-party platforms. Internet auto insurance shows only 50.2% dependence on intermediary channels, compared to 78.1% for health insurance and 95.2% for return shipping insurance. This indicates that insurers exercise far greater control over their proprietary channels in auto insurance than in other internet insurance categories.
Within self-operated platforms, mobile apps and official accounts serve as the primary premium sources, collectively contributing nearly 50% of premiums. Auto insurance represents the largest business line on both channels, accounting for 68.8% of app-generated premiums and 55% of official account premiums. Unlike other internet insurance products that rely on situational triggers, auto insurance is a highly regulated, essential product with an annual renewal decision, providing insurers with opportunities to retain customers through renewal reminders and app engagement—a dynamic that ultimately positions self-operated platforms as the dominant channel.
Beyond insurer platforms, professional agency channels remain influential. Platforms such as Ant Baoxian and Tencent WeSure leverage AI-driven price comparison and intelligent recommendations to aggregate fragmented consumer demand, serving as bridges connecting insurers, the automotive aftermarket, and policyholders. Industry data shows Tencent WeSure's auto insurance premiums grew 70% in 2025, with its user base doubling in three years and projected growth exceeding 50% in 2026. Ant Baoxian surpassed 10 billion yuan in auto insurance premiums in 2024, maintaining average annual growth of over 30% in insured vehicles over the past three years.