Insurance funds are about to "operate" gold! Four major insurance fund giants have been approved to become members of the Shanghai Gold Exchange

On March 24, the Shanghai Gold Exchange announced on its website: It has agreed to accept China People's Property Insurance Company, China Life Insurance Company, Ping An Life Insurance Company, and China Pacific Life Insurance Company as members of the Shanghai Gold Exchange.

This means that after gaining membership, these insurance giants, as long-term capital, are ready to embark on gold investment.

Insurance funds are broadening their hedging avenues and have welcomed a formal "trading opportunity."

Insurance Capital Invests in Gold “ Small Steps, Quick Pace ”

In early February 2025, insurance capital's participation in gold investment officially "opened the floodgates."

The National Financial Regulatory Administration issued a notice on "Conducting Pilot Projects for Insurance Funds to Invest in Gold," which outlines the scope of gold investment for the pilot program, including gold spot contracts listed or traded on the main board of the Shanghai Gold Exchange, gold spot deferred delivery contracts, Shanghai gold centralized pricing contracts, gold inquiry spot contracts, gold inquiry swap contracts, and gold leasing business.

It is worth noting that the pilot participants involve ten major insurance giants in China, including China People's Property Insurance Company, China Life Insurance Company, Taiping Life Insurance Company, China Export & Credit Insurance Corporation, Ping An Property & Casualty Insurance Company, Ping An Life Insurance Company, China Pacific Property Insurance Company, China Pacific Life Insurance Company, Taikang Life Insurance Co., Ltd., and New China Life Insurance Company.

In addition, the aforementioned notice clarifies the scale requirements for insurance capital's gold investment:

"Pilot insurance companies must strictly adhere to investment ratio requirements, with the total book balance of gold investments not exceeding 1% of the company's total assets at the end of the previous quarter."

According to data from the Financial Regulatory Administration, as of the end of the third quarter of 2024, the balance of Chinese insurance funds reached 32.15 trillion yuan, a year-on-year increase of 14.06%.

Trading Imminent

The Shanghai Gold Exchange, abbreviated as SGE, was established by the People's Bank of China and is a financial market specifically engaged in the trading of precious metals such as gold, silver, and platinum.

The membership qualifications obtained by the four insurance giants mentioned above mean that these insurance giants will soon officially gain trading rights for precious metals.

According to the "Member Management Measures of the Shanghai Gold Exchange," the Shanghai Gold Exchange operates on a membership system, and members have the right to engage in trading activities of gold, silver, platinum, and their derivatives upon approval by the exchange