ZA ONLINE's profits have doubled, revealing a new curve: the awakening of "technological bloodline" is in progress

After turning a profit last year, ZA ONLINE has successfully doubled its profits.

In 2024, ZA's insurance service revenue increased by 15.3% year-on-year to 31.744 billion yuan, with premiums ranking eighth in the domestic property insurance sector;

Net profit attributable to shareholders reached 603 million yuan, with a growth rate of 105.4% after excluding one-time investment income from the same period last year.

Behind the more than double profit growth is a "double harvest" of insurance and technology—

Insurance profit was 588 million yuan, a year-on-year increase of 6.2%; technology, on the other hand, turned a profit for the first time in its eight years of listing, with a profit of only 77 million yuan but a growth of 546 million yuan.

ZA's future performance may still have upward potential:

Firstly, the insurance business is in a high-growth phase and has profitability;

Secondly, the technology business, which has been invested in for many years, has finally transitioned from passive "blood transfusion" to active "blood production."

As the first internet insurance company in China, ZA's "dual-engine" strategy of insurance and technology is beginning to take effect.

Chairman Yin Hai believes that innovative characteristics and technological capabilities are key to achieving a unique growth curve.

Now, ZA's "technological bloodline" seems to be awakening, and the advantages brought by its endowment are finally being realized in its financial reports.

Scenarios Supporting Growth

ZA's insurance structure is quite different from traditional insurance companies.

In 2024, the top five income-generating insurance types in the property insurance industry are car insurance, liability insurance, agricultural insurance, health insurance, and accident insurance;

However, ZA's order is health insurance, guarantee insurance, accident insurance, car insurance, and credit insurance.

In contrast, ZA has abandoned agricultural insurance, which is not suitable for online pricing and loss assessment, and has not focused its main efforts on car insurance, which is regarded as a mainstay by traditional large and medium-sized insurance companies;

Instead, it has invested more resources according to its internet endowment, targeting scenarios and demographics suitable for online sales and underwriting.

For example, among its four major business categories, the digital life business, which generates the most revenue, mainly provides return and logistics insurance for e-commerce platforms, as well as delay and refund insurance for travel, and also involves pet insurance and mobile phone screen damage insurance.

Almost all new insurance scenarios are backed by ZA's bold investments.

Benefiting from the sustained prosperity of the e-commerce industry and the growing demand for pet insurance, ZA's total premium for digital life insurance reached 16.197 billion yuan in 2024, a year-on-year increase of 28.9%.

However, innovation often comes with trial and error costs.

The low unit price and simple claims process of return insurance have led to fixed compensation amounts and negotiable actual freight costs, resulting in bulk orders and malicious returns in many regions, exploited by "professional wool party" members;

Pet insurance, which has a higher unit price and relatively complex terms, has frequently faced complaints on platforms like Black Cat, with issues including difficulty finding cancellation channels, ambiguous terms, and unreasonable claim denials.

Amid various problems, although the digital business saw high premium growth in 2024, its profits were meager, with a comprehensive underwriting cost ratio as high as 99.7%.

The asymmetry between main business revenue and profit reflects the overall dilemma of ZA's insurance.

Although insurance service revenue increased by 15.3% year-on-year, underwriting profit declined by 2.44%, with the entire insurance sector's profit growth relying entirely on the incremental investment income driven by the "bull market" in stocks and bonds. If the bond market fluctuates or the equity market weakens in the new year, ZA ONLINE may find it difficult to maintain its current profits.

Technology Releases Momentum

What was once often seen as a storytelling technology business is becoming a new highlight for ZA ONLINE.

In fact, as early as 2023, the cloud core system "Wujieshan" under ZA ONLINE, which supports the operation management of insurance business, issued over 10 billion insurance policies, helping ZA ONLINE achieve an automation rate of 99% in underwriting.

This is also the conventional understanding of insurance technology from the outside.

However, today's technology business is no longer satisfied with just providing support; it welcomed its first profit in 2024:

The total revenue from technology, including the joint venture ZA Xinke and Peak3, reached 956 million yuan, a year-on-year increase of 15.3%;

Excluding the joint venture portion, the technology division primarily led by ZA ONLINE achieved a net profit of 77 million yuan, with a profit turnaround of 546 million yuan.

(ZA Xinke is a joint venture company of ZA ONLINE, and Peak3 is a non-wholly-owned subsidiary of ZA ONLINE.)

This represents that the technology division, which ZA ONLINE has invested in for eight years, has finally begun to actively "generate blood."

According to Xinfeng, ZA ONLINE Technology mainly focuses on internal innovation incubation, ZA Xinke leans towards AI enterprise services, and Peak3 emphasizes overseas business.

ZA ONLINE Technology, which contributed 546 million yuan to the profit turnaround, has three product lines: business production, growth, and digital new infrastructure.

Business production mainly includes cloud-based distributed architecture insurance core and peripheral systems, agency core systems, and IFRS17 (new insurance contract standards) system solutions, among others.

Among them, the IFRS17 system solution alone is expected to bring substantial revenue.

According to regulatory requirements, non-listed insurance companies must replace IFRS4 (old standard) with IFRS17 before 2026;

The differences between the two are significant, and the transition requires the establishment of new data platforms, measurement platforms, accounting engines, and the transformation of various core business systems, which is costly.

Research results from Tao Rui Hui Yue show that the average planned cost for the 24 largest multinational insurance companies in the world to implement IFRS17 is about 175-200 million USD; the cost for the remaining 288 insurance companies is about 20 million USD.

Referring to domestic cases, the bidding results for IFRS17 among small and medium-sized insurance companies generally range from 7 to 15 million yuan, with life insurance companies being higher than property insurance;

The cost for leading large insurance companies to switch standards is over 20 million yuan.

A practitioner from a large consulting firm told Xinfeng, "The IFRS17 system requires the participation of technology companies. Although the parent company of ZA ONLINE Technology is an insurance company, it is still a technology company, and there is no risk of data leakage when insurance companies cooperate with it."

Currently, the solutions proposed by ZA ONLINE Technology cover the entire process of data collection, model construction, and computational processing. By the end of 2024, a total of 21 clients have been signed.

These include both domestic and foreign property and life insurance companies such as Minsheng Life and AXA Tianping, as well as large policy-oriented insurance companies like China Export & Credit Insurance Corporation.

ZA ONLINE Technology's IFRS17 product was launched in 2023, with the fastest completion cycle being 6 months According to the forecast by Xinfeng, as the key node of 2026 approaches, it is expected that there will still be a continuous release of related large revenues.

In addition to ZhongAn Technology, the unmerged ZhongAn Xinke also performed well.

The company focuses on cultivating large models, with core capabilities in providing end-to-end solutions from models to scenarios, bridging the "last mile" from technology to value.

In 2024, the company signed contracts with 98 clients in the insurance industry chain, including 7 clients at the ten million yuan level; at the same time, it expanded to 16 clients in the broader financial industry, including banks and securities.

Wang Min, chairman of ZhongAn Xinke, stated, "Enterprises have weak capabilities in monetizing data and knowledge in the application practice of AI large models, which is also key for enterprises to seize positions and gain an advantage."

Wang Min believes that the transformation brought by AI has just begun, "We need to evolve through learning and imagine through evolution."

In February 2025, ZhongAn Xinke completed its A+ round of financing, with participating institutions including Nanshan Zhanxin Investment, Yicun Capital, Huamin Investment, and Binfu Capital;

Peak3, focusing on overseas business, completed a $35 million Series A financing in June 2024, led by EQT, with Alpha JWC Ventures as a co-investor, and JP Morgan serving as the exclusive financial advisor