People Insurance of China : FIRST QUARTERLY REPORT OF 2021

Hong Kong Exchanges and Clearing Limited and The Stock Exchange of Hong Kong Limited take no responsibility for the contents of this announcement, make no representation as to its accuracy or completeness and expressly disclaim any liability whatsoever for any loss howsoever arising from or in reliance upon the whole or any part of the contents of this announcement.

(A joint stock company incorporated in the People's Republic of China with limited liability)

(Stock Code: 1339)

FIRST QUARTERLY REPORT OF 2021

This announcement is made by The People's Insurance Company (Group) of China Limited (the "Company") pursuant to the Inside Information Provisions under Part XIVA of the Securities and Futures Ordinance (Chapter 571 of the Laws of Hong Kong) and Rules 13.09 and 13.10B of the Rules Governing the Listing of Securities on The Stock Exchange of Hong Kong Limited.

The financial data of the Company for the first quarter of 2021 are unaudited and have been prepared in accordance with the PRC Accounting Standards for Business Enterprises.

1. IMPORTANT INFORMATION

1. The Board of Directors, the Board of Supervisors, the directors, the supervisors and the senior management of the Company undertake that the contents of this quarterly report are true, accurate and complete and that there is no false record, misleading statement or material omission in this quarterly report, and they severally and jointly accept responsibility for the contents of this quarterly report.
2. The 2021 First Quarterly Report of the Company was considered and approved at the 27th meeting of the 3rd session of the Board of Directors of the Company on 28 April 2021, which 13 directors were required to attend and 13 of them attended in person.
3. Mr. Luo Xi (Chairman of the Company), Mr. Wang Tingke (President in charge of accounting work) and Mr. Zhang Hongtao (Head of the Finance Department) warrant the truthfulness, accuracy and completeness of the financial statements contained in this quarterly report.
4. The financial data contained in the 2021 First Quarterly Report of the Company are unaudited and have been prepared in accordance with the PRC Accounting Standards for Business Enterprises.

Note: Unless otherwise specified, the currencies in this report are all in RMB.

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2. BASIC INFORMATION OF THE COMPANY 2.1 Key Financial Data

		Unit: RMB million
	As of 31	As of 31
	March 2021 December 2020	Change (%)
Total Assets	1,339,181	1,255,461	6.7
Equity attributable to shareholders of
the parent company	207,758	202,194	2.8
Net assets per share attributable to
shareholders of the parent company
(RMB/share)	4.70	4.57	2.8
	January to	January to
	March 2021	March 2020	Change (%)
Net cash flows generated from
operating activities	23,198	1,965	1,080.6
Operating income	173,762	168,881	2.9
Net profit attributable to shareholders
of the parent company	10,034	7,061	42.1
Net profit attributable to shareholders
of the parent company after
deducting non-recurring items	9,999	7,077	41.3
Basic earnings per share (RMB/share)	0.23	0.16	42.1
Diluted earnings per share (RMB/
share)	0.23	0.16	42.1
Basic earnings per share after
deducting non-recurring items
(RMB/share)	0.23	0.16	41.3
Weighted average return on equity			Increase of
(%)	4.9	3.8	1.1 pts
Weighted average return on equity
after deducting non-recurring items			Increase of
(%)	4.9	3.8	1.1 pts

Note: The percentage increase or decrease of basic earnings per share, diluted earnings per share and basic earnings per share after deducting non-recurring items is calculated based on the data before rounding off.

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2.2 Non-recurring Items

	Unit: RMB million
	January to	January to
	March 2021	March 2020
Gains or losses from disposal of non-current assets	42	19
Government grants included in profit or loss	12	12
Net non-recurring items other than those
mentioned above	15	(52)
Effect of income tax on non-recurring items	(20)	1
Attributable to non-controlling interests	(14)	4
Total	35	(16)

2.3 Solvency of the Group and Its Subsidiaries

					Unit: RMB million
As of 31 March 2021	PICC Group	PICC P&C	PICC Life	PICC Health
Core capital			337,368	189,363	106,511	13,016
Actual capital		399,723	217,345	119,345	16,569
Minimum capital		128,790	71,606	46,122	8,516
Core solvency margin ratio (%)	262	264	231	153
Comprehensive solvency margin
ratio (%)			310	304	259	195
Notes:	1.	PICC Group means the Company and all of its subsidiaries;
	2.	PICC P&C means PICC Property and Casualty Company Limited;
	3.	PICC Life means PICC Life Insurance Company Limited;
	4.	PICC Health means PICC Health Insurance Company Limited.

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2.4 Total Number of Shareholders, Shareholdings of the Top Ten Shareholders and Top Ten Shareholders not Subject to Selling Restrictions as at the End of the Reporting Period

						Unit: Share
Total number of shareholders (Shareholder)			A Share: 257,974; H Share: 5,643
	Shareholdings of the Top Ten Shareholders
	Number of		The number	Pledged or frozen
	shares held as		of shares held	shares
Name of shareholder	at the end of the	Proportion	subject to selling	Status of	Number	Class of
(in full name)	reporting period	(%)	restrictions	the shares	of shares	Shareholder
Ministry of Finance of the PRC	26,906,570,608	60.84%	26,906,570,608	-	-	The State
HKSCC Nominees Limited	8,702,517,698	19.68%		-	-	Foreign legal
						person
National Council for Social Security	6,313,368,327	14.28%	2,989,618,956	-	-	The State
Fund, PRC
Hong Kong Securities Clearing	47,954,061	0.11%	-	-	-	Foreign legal
Company Limited						person
Beijing Hengzhaoweiye Investment	20,607,653	0.05%	-	-	-	Domestic Non-
Company Limited						state-owned
						legal person
Wang Ru	13,982,890	0.03%	-	-	-	Domestic
						natural person
Industrial and Commercial Bank of	12,795,077	0.03%	-	-	-	Others
China-Shanghai 50 Transactional
Open Index Securities Investment
Fund
Li Shaofu	12,150,000	0.03%	-	-	-	Domestic
						natural person
CITIC Securities Company Limited	9,912,088	0.02%	-	-	-	Domestic Non-
						state-owned
						legal person
Huo Wenliang	9,774,871	0.02%	-	-	-	Domestic natural
						person

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Note:

1. In addition to the 6,313,368,327 A Shares of the Company held by it, National Council for Social Security Fund, PRC holds 524,279,000 H Shares as a beneficial owner and 649,000 H Shares through overseas manager.

2. HKSCC Nominees Limited holds shares on behalf of securities firm customers in Hong Kong and other CCASS participant. Relevant regulations of The Stock Exchange of Hong Kong Limited do not require such persons to declare whether their shareholdings are pledged or frozen. Hence, HKSCC Nominees Limited is unable to calculate or provide the number of shares that are pledged or frozen.

3. The shares under Hong Kong Securities Clearing Company Limited are held by the shareholders of the Shanghai Stock Connect.

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12,150,000 A Share 12,150,000

9,912,088 A Share 9,912,088

9,774,871 A Share 9,774,871

8,911,600 A Share 8,911,600 The Company is not aware of any connected relationship among the

above shareholders or any parties acting in concert as defined by the "Measures for the Administration of the Takeover of Listed Companies".

Shareholdings of the Top Ten Shareholders Not Subject to Selling Restrictions

	Number of shares held
	not subject to selling	Class and number of shares
Name of shareholder	restrictions	Class	Number
HKSCC Nominees Limited	8,702,517,698	H Share	8,702,517,698
National Council for Social Security	3,323,749,371	A Share	3,323,749,371
Fund, PRC
Hong Kong Securities Clearing	47,954,061	A Share	47,954,061
Company Limited
Beijing Hengzhaoweiye Investment	20,607,653	A Share	20,607,653
Company Limited
Wang Ru	13,982,890	A Share	13,982,890
Industrial and Commercial Bank of	12,795,077	A Share	12,795,077
China-Shanghai 50 Transactional Open
Index Securities Investment Fund
Li Shaofu
CITIC Securities Company Limited
Huo Wenliang
Li Mahao
Details of the above shareholders who

are connected to each other or acting in concert

3	QUARTERLY BUSINESS ANALYSIS
	3.1 Key Financial Indicators
					Unit: RMB million
			January to	January to
			March 2021	March 2020	Change (%)
		Gross written premiums	204,754	194,177	5.4
		Profit before tax	16,172	12,070	34.0
		Net profit	13,844	9,876	40.2
		Net profit attributable to shareholders of
		the parent company	10,034	7,061	42.1
		Basic earnings per share (RMB/share)	0.23	0.16	42.1
	Weighted average return on equity (%)	4.9	3.8	Increase of 1.1 pts
			As of	As of
			31 March	31 December
			2021	2020	Change (%)
		Total assets	1,339,181	1,255,461	6.7
		Total liabilities	1,058,117	982,325	7.7
		Total equity	281,064	273,136	2.9
		Net assets per share attributable to
		shareholders of the parent company
		(RMB/share)	4.70	4.57	2.8
		Gearing ratio (%)	79.0	78.2	Increase of 0.8 pt

In the first quarter of 2021, the Group1 firmly kept in mind the initial mission of serving the people, carried out "To be Prominent Strategy", strengthened responsibility, maintained a stable, progressive, and positive development trend in the core businesses. Its profitability increased significantly, and the performance of cash flows from operating activities was excellent. The group has achieved satisfactory results in the transformation to high-quality development. In the first quarter of 2021, the gross written premiums of the Group amounted to RMB204,754 million, representing a period-on-period increase of 5.4%. The net profit amounted to RMB13,844 million, representing a period-on-period increase of 40.2%. The net profit attributable to shareholders of the parent company amounted to RMB10,034 million, representing a period-on-period increase of 42.1%. The net profit attributable to shareholders of the parent company after deducting non-recurring items amounted to RMB9,999 million, representing a period-on-period increase of 41.3%. The earnings per share amounted to RMB0.23, representing a period-on-period increase of 42.1%. The weighted average return on equity was 4.9%, representing a period-on-period increase of 1.1 percentage points. The net cash flow generated from operating activities amounted to RMB23,198 million, representing a significantly increase compared with the same period of last year.

1 The Group means the Company and all of its subsidiaries.

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The Group further boosted its capital. As of 31 March 2021, the total equity of the Group was RMB281,064 million, representing an increase of 2.9% as compared to the beginning of the year, the net assets per share attributable to shareholders of the parent company was RMB4.70, representing an increase of 2.8% as compared to the beginning of the year.

3.2 Insurance Business

3.2.1 PICC P&C

In the first quarter of 2021, PICC P&C fully implemented "To be Prominent Strategy" of the Group, consistently upheld a customer-centric concept and concentrated on the four main themes consisting of "focusing on main business, striving for excellence, emphasizing on competency and providing comprehensive service", proactively responded to the comprehensive reform of motor vehicle insurance, optimised business structure and resource allocation, strictly controlled business risks, promoted the development through reform and innovation and achieved a good start. During the reporting period, PICC P&C1 achieved original premiums income of RMB135,552 million, representing a period-on-period increase of 6.2%. The claim ratio was 70.3%, representing a period-on-period increase of 4.0 percentage points. The expense ratio was 25.4%, representing a period-on-period decrease of 5.4 percentage points. The combined ratio was 95.7%, representing a period-on-period decrease of 1.4 percentage points. The net profit amounted to RMB8,942 million, representing a period-on-period increase of 40.7%.

The original premiums income by type from PICC P&C for the above periods indicated as follows:

			Unit: RMB million
	January to	January to
	March 2021	March 2020	Change (%)
Motor vehicle insurance	57,503	61,660	(6.7)
Accidental injury and health
insurance	43,646	34,805	25.4
Agricultural insurance	12,196	9,766	24.9
Liability insurance	9,784	8,213	19.1
Commercial property insurance	5,266	4,859	8.4
Credit insurance	490	2,497	(80.4)
Cargo insurance	1,257	1,039	21.0
Other P&C insurance	5,410	4,804	12.6
Total	135,552	127,643	6.2

1 The data is from the individual statement of PICC P&C as the parent company.

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3.2.2 PICC Life

In the first quarter of 2021, PICC Life thoroughly implemented the Group's "To be Prominent Strategy", put more efforts into innovation and reform, improved product structure, vigorously promoted team-building and the development of value- based regular premium business, strictly controlled risks, reinforced the foundation of development and strengthened value-oriented, which led to further improved profitability. During the reporting period, PICC Life achieved original premiums income of RMB50,660 million, representing a period-on-period decrease of 5.4%. The regular original premiums income amounted to RMB40,737 million, representing a period-on-period increase of 6.5%. The first-year regular total written premiums with the paid period of more than ten years amounted to RMB1,581 million. The net profit was RMB3,290 million, representing a period-on-period increase of 15.6%.

The original premiums income by type from PICC Life for the above periods indicated as follows:

		Unit: RMB million
	January to	January to
	March 2021	March 2020	Change (%)
First-year business of long-term
insurance	21,527	26,128	(17.6)
Single premiums	8,868	14,331	(38.1)
First-year regular premiums	12,659	11,797	7.3
Renewal business	28,078	26,459	6.1
Short-term insurance	1,055	992	6.4
Total	50,660	53,579	(5.4)

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3.2.3 PICC Health

In the first quarter of 2021, PICC Health extensively carried out the Group's "To be Prominent Strategy", adhered to the direction of serving people's health, highlighted the two functions of "protecting from health risks and providing healthcare services", concentrated on the three key words of "Progress, Breakthrough, and Reform", promoted business growth, strengthened corporation's characteristics, enhanced sales' quality and efficiency, steadily promoted the transformation of business model. PICC Health accelerated the high-quality development in the strategy of serving "Healthy China" and constructing the national multi-level medical security system and realised the relatively rapid growth in business, which indicates the overall business of PICC Health will continue to achieve sustained growth. During the reporting period, PICC Health achieved original premiums income of RMB17,190 million, representing a period-on-period increase of 37.0%. The net profit amounted to RMB141 million, representing a period-on-period increase of 56.7%.

The original premiums income by type from PICC Health for the above periods indicated as follows:

			Unit: RMB million
	January to	January to
	March 2021	March 2020	Change (%)
First-year business of long-term
insurance	7,040	3,627	94.1
Single premiums	5,122	1,240	313.1
First-year regular premiums	1,918	2,387	(19.6)
Renewal business	3,585	2,004	78.9
Short-term insurance	6,565	6,917	(5.1)
Total	17,190	12,548	37.0

3.3 Asset Management Business

In the first quarter of 2021, the asset management segment of the Group actively served for the new development pattern of national "Dual Circulation", implemented requirements of the Group's "To be Prominent Strategy", strengthened market trend research, adjusted asset allocation dynamically, made the investment yield well, and prevented investment risks effectively. In terms of bond investment, the asset management segment chose optimal allocation time, grasped investment opportunities, and never chase the high income at the expense of credit sinking. In terms of equity investment, it actively seized investment opportunities of industry and individual stock, optimised the position structure constantly, and achieved robust investment performance.

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4. IMPORTANT INFORMATION

4.1 Particulars of and Reasons for Material Changes in Major Accounting Items and Financial Indicators of the Company

4.1.1 Changes in key financial indicators and the reasons

				Unit: RMB million
	As of 31	As of 31
Key financial	March	December	Change	Reasons of
indicators	2021	2020	(%)	major changes
Total assets	1,339,181	1,255,461	6.7	Growth in
				insurance
				business
Total liabilities	1,058,117	982,325	7.7	Increase in
				insurance
				reserves
Equity attributable to	207,758	202,194	2.8	Increase in net
shareholders of the				profits
parent company
				Unit: RMB million
Key financial	January to	January to	Change	Reasons of major
indicators	March 2021	March 2020	(%)	changes
Operating income	173,762	168,881	2.9	Growth in
				insurance
				business and
				increase in
				investment
				income
Net profit attributable	10,034	7,061	42.1	Increase in
to the shareholders of				investment
the parent company				income

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4.1.2 Material changes in major financial items and analysis
					Unit: RMB million
		As of 31	As of 31
		March	December	Change	Reasons of major
	Items in Balance Sheet	2021	2020	(%)	changes
	Premiums receivable	85,612	36,775	132.8	Growth in scale
					of government
					coordinating
					business
	Receivables from	22,717	15,578	45.8	Affected by
	reinsurers				increase of
					premiums ceded
					and reinsurance
					settlement cycle
	Premiums received in	13,177	24,048	(45.2)	Transformation
	advance				of prepaid
					premiums
					to received
					premiums
	Payables to reinsurers	31,093	21,296	46.0	Affected by
					reinsurance
					settlement cycle
	Policyholders' dividend	5,477	4,096	33.7	Increase in policy
	payable				dividend
	Deferred tax liabilities	271	1,449	(81.3)	Fluctuation in
					capital market

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Items in	January to	January to	Change	Unit: RMB million
income statement	March 2021	March 2020	(%) Reasons of major changes
Reinsurance premiums	1,300	359	262.1	Increase in overseas
assumed	36,017			reinsurance business
Change in unearned	27,683	30.1	Increase in insurance
premium reserves				business and decline in
	17,995			policy acquisition cost ratio
Investment income	13,165	36.7	Increase in the bid-ask spread
	387			of financial assets
Fair value losses	57	578.9	Fluctuation in capital market
Exchange gains	90	232	(61.2)	Fluctuation in exchange rate
Gains on disposal of assets	42	22	90.9	Increase in disposal of assets
Other operating income	798	594	34.3	Increase in rental income and
	6,622			management income
Surrenders	34,216	(80.6)	Adjustment of business
				structure and significant
				reduction of surrenders
				compared with the same
	78,030			period of last year
Gross claims paid	59,062	32.1	Achieving faster claim
	5,718			settlement
Paid losses recoverable	3,821	49.6	Achieving faster claim
from reinsurers				settlement and increase in
	41,166			ceded scale
Change in insurance	25,863	59.2	Decrease in the surrender
contract liability reserves				value of life insurance
				compared with the same
Reinsurers' share of	(1,352)			period of last year
(360)	275.6	Decrease in original
insurance contract				insurance outstanding
liability reserves				claim reserves compared
				with the same period
				of last year, leading to
				corresponding increase
				in the reinsurers' share of
				insurance contract liability
	371			reserves
Reinsurance expenses	109	240.4	Increase in reinsurance
	334			business
Impairment losses	618	(46.0)	Improvement of premiums
				receivable and reduction of
	16,177			bad debts loss
Operating profit	12,121	33.5	Affected by above mentioned
Non-operating expenses	38	80	(52.5)	Reduction of donation
	16,172			expenditure
Profit before tax	12,070	34.0	Affected by above mentioned
Net profit	13,844	9,876	40.2	Affected by above mentioned
Other comprehensive	(5,916)	(3,085)	91.8	Fluctuation in fair value of
income, net of tax				available-for-sale financial
				assets

4.2 Explanation and Analysis of Significant Events and Their Impacts and Solutions

□Applicable  √Not applicable

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1. Undertakings Were Not Implemented in Due Time During the Reporting Period
   □Applicable   √Not applicable
2. Warning of Projection on Cumulative Net Profit for the Period from the Beginning of the Year to the End of the Next Reporting Period to be at a Loss or Expected to Have Material Changes as Compared to the Corresponding Period of Last Year and Its Explanation
   □Applicable   √Not applicable

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5. APPENDIX

5.1 Consolidated Statement of Financial Position and Statement of Financial Position of the Company as at 31 March 2021 and 31 December 2020

Consolidated Statement of Financial Position As at 31 March 2021

(Amounts in millions of Renminbi, unless otherwise stated)

	31 March	31 December
	2021		2020
	(Unaudited)	(Audited)
ASSETS
Cash and bank balances	20,982	24,104
Financial assets at fair value through profit or loss	41,272	33,433
Financial assets purchased under resale agreements	55,307	55,081
Premiums receivable	85,612	36,775
Receivables from reinsurers	22,717	15,578
Reinsurers' share of unearned premium reserves	14,811	12,202
Reinsurers' share of outstanding claim reserves	16,522	18,192
Reinsurers' share of life insurance reserves	27	25
Reinsurers' share of long-term health insurance
reserves	4,388	4,072
Policy loans	5,611	5,295
Other receivables	15,400	13,893
Term deposits	89,807	89,016
Available-for-sale financial assets	399,152	379,312
Held-to-maturity investments	183,524	181,199
Investments classified as loans and receivables	163,855	171,307
Long-term equity investments	127,880	124,840
Restricted statutory deposits	12,994	12,994
Investment properties	13,035	13,246
Fixed assets	32,912	33,183
Right-of-use assets	2,878	2,942
Intangible assets	7,916	8,123
Deferred tax assets	9,734	8,491
Other assets	12,845	12,158
TOTAL ASSETS	1,339,181		1,255,461

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	31 March	31 December
	2021		2020
	(Unaudited)	(Audited)
LIABILITIES AND EQUITY
LIABILITIES
Securities sold under agreements to repurchase	78,410	85,826
Premiums received in advance	13,177	24,048
Handling charges and commission payable	9,251	8,177
Payables to reinsurers	31,093	21,296
Salaries and staff welfare payables	22,144	21,671
Tax payable	10,000	8,579
Claims payable	9,661	12,493
Policyholders' dividend payable	5,477	4,096
Other payables	17,577	17,167
Policyholders' deposits	41,266	39,338
Unearned premium reserves	199,488	160,862
Outstanding claim reserves	161,181	162,022
Life insurance reserves	342,547	303,046
Long-term health insurance reserves	48,113	45,031
Premiums reserve	3,095	2,594
Bonds payable	57,008	56,960
Lease liabilities	2,932	2,792
Deferred tax liabilities	271	1,449
Other liabilities	5,426	4,878
TOTAL LIABILITIES	1,058,117		982,325

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	31 March	31 December
	2021		2020
	(Unaudited)	(Audited)
EQUITY
Issued capital	44,224	44,224
Share premium account	7,545	7,545
Other comprehensive income	12,998	17,468
Surplus reserve	13,319	13,319
General risk reserve	13,781	13,772
Catastrophic loss reserve	793	793
Retained profits	115,098	105,073
Equity attributable to equity holders of the Company	207,758		202,194
Non-controlling interests	73,306	70,942
TOTAL EQUITY	281,064		273,136
TOTAL LIABILITIES AND EQUITY	1,339,181		1,255,461

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Statement of Financial Position of The Company

As at 31 March 2021

(Amounts in millions of Renminbi, unless otherwise stated)

	31 March	31 December
	2021		2020
	(Unaudited)	(Audited)
ASSETS
Cash and bank balances	694	489
Financial assets at fair value through profit or loss	676	740
Financial assets purchased under resale agreements	232	280
Other receivables	298	218
Term deposit	4,463	4,462
Available-for-sale financial assets	12,783	12,126
Investments classified as loans and receivables	7,248	7,248
Long term equity investments	91,126	91,042
Investment properties	2,542	2,542
Fixed assets	2,768	2,790
Intangible assets	88	85
Other assets	80	66
TOTAL ASSETS	122,998		122,088

- 17 -

	31 March	31 December
	2021		2020
	(Unaudited)	(Audited)
LIABILITIES AND EQUITY
LIABILITIES
Securities sold under agreements to repurchase	123	30
Salaries and staff welfare payables	3,539	3,593
Tax payable	25	12
Other payables	442	384
Bonds payable	17,988	17,987
Other liabilities	872	647
TOTAL LIABILITIES	22,989		22,653
EQUITY
Issued capital	44,224		44,224
Share premium account	35,578		35,578
Other comprehensive income	1,280		908
Surplus reserve	13,319		13,319
Retained profits	5,608		5,406
TOTAL EQUITY	100,009		99,435
TOTAL LIABILITIES AND EQUITY	122,998		122,088

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5.2 Consolidated Income Statement and Income Statement of the Company for the Three Months Ended 31 March 2021 and for the Three Months Ended 31 March 2020

Consolidated Income Statement

For the three months ended 31 March 2021

(Amounts in millions of Renminbi, unless otherwise stated)

	Three months	Three months
	ended	ended
	31 March 2021	31 March 2020
	(Unaudited)	(Unaudited)
OPERATING INCOME	173,762		168,881
Net earned premiums	155,091		154,814
Gross written premiums	204,754		194,177
Included: Reinsurance premiums assumed	1,300		359
Less: Premiums ceded to reinsurers	(13,646)	(11,680)
Change in unearned premium reserves	(36,017)	(27,683)
Investment income	17,995		13,165
Included: Share of profits and losses of
associates and joint ventures	2,643		2,203
Fair value losses	(387)	(57)
Exchange gains	90		232
Gains on disposal of assets	42		22
Other income	133		111
Other operating income	798		594
OPERATING EXPENSES	157,585		156,760
Surrenders	6,622		34,216
Gross claims paid	78,030		59,062
Less: Paid losses recoverable from reinsurers	(5,718)	(3,821)
Change in insurance contract liability reserves	41,166		25,863
Less: Reinsurers' share of insurance contract liability
reserves	1,352		360
Change in premium reserve	363		291
Interest expenses credited to policyholders' deposits	1,995		1,808
Reinsurance expenses	371		109
Tax and other surcharges	411		490
Handling charges and commissions	14,744		17,407
General and administrative expenses	19,438		21,656
Less: Net reinsurance commission income	(3,421)	(2,949)
Other operating costs	1,898		1,650
Impairment losses	334		618

- 19 -

	Three months	Three months
	ended	ended
	31 March 2021	31 March 2020
	(Unaudited)	(Unaudited)
OPERATING PROFIT	16,177		12,121
Add: Non-operating income	33		29
Less: Non-operating expenses	(38)	(80)
PROFIT BEFORE TAX	16,172		12,070
Less: Income tax expense	(2,328)	(2,194)
NET PROFIT	13,844		9,876
By continuing operations:
Net profit from continuing operations	13,844		9,876
By ownership:
1. Net profit attributable to equity holders of the
Company	10,034		7,061
2. Net profit attributable to non-controlling interests	3,810		2,815
OTHER COMPREHENSIVE INCOME FOR THE
YEAR, NET OF TAX
Other comprehensive income attributable to equity
holders of the company, net of tax	(4,470)	(2,364)
OTHER COMPREHENSIVE INCOME THAT MAY
BE RECLASSIFIED TO PROFIT OR LOSS:
Fair value losses of available-for-sale financial assets	(4,408)	(2,425)
Portion of fair value changes attributable to
participating policyholders	(334)	-
Other comprehensive income that may be reclassified
to profit or loss under the equity method	225		39
Exchange differences arising on translation of foreign
operations	9		22
OTHER COMPREHENSIVE INCOME THAT WILL
NOT BE RECLASSIFIED TO PROFIT OR LOSS
Other comprehensive income that cannot be
reclassified to profit or loss under the equity method	38		-
Other comprehensive income attributable to non-
controlling interests, net of tax	(1,446)	(721)
TOTAL	(5,916)	(3,085)

- 20 -

	Three months	Three months
	ended	ended
	31 March 2021	31 March 2020
	(Unaudited)	(Unaudited)
TOTAL COMPREHENSIVE INCOME	7,928		6,791
Attributable to equity holders of the Company	5,564		4,697
Attributable to non-controlling interests	2,364		2,094
EARNINGS PER SHARE (in RMB Yuan)
- Basic	0.23		0.16

Note: The Group had no potential ordinary shares in issue during the three months ended 31 March 2021 and the three months ended 31 March 2020.

- 21 -

Income Statement of The Company

For the three months ended 31 March 2021

(Amounts in millions of Renminbi, unless otherwise stated)

	Three months	Three months
	ended	ended
	31 March 2021	31 March 2020
	(Unaudited)	(Unaudited)
OPERATING INCOME	495	409
Investment income	458	335
Included: Share of profits and losses of
associates	84	82
Fair value losses	(30)	(35)
Exchange gains	3	30
Other operating income	64	79
OPERATING EXPENSES	427		427
Tax and other surcharges	4	3
General and administrative expenses	158	163
Other operating costs	250	254
Impairment losses	15	7
OPERATING PROFIT	68		(18)
Add: Non-operating income	-	-
Less: Non-operating expenses	-	-
PROFIT BEFORE TAX	68		(18)
Less: Income tax credit/(expense)	134	(245)
NET PROFIT	202		(263)

- 22 -

	Three months	Three months
	ended	ended
	31 March 2021	31 March 2020
	(Unaudited)	(Unaudited)
OTHER COMPREHENSIVE INCOME
OTHER COMPREHENSIVE INCOME
THAT MAY BE RECLASSIFIED
SUBSEQUENTLY TO PROFIT OR LOSS:
Fair value gains/(losses) of available-for-sale
financial assets	372	(684)
OTHER COMPREHENSIVE INCOME
THAT WILL NOT BE RECLASSIFIED TO
PROFIT OR LOSS
Remeasurement of the variation of defined
benefit plans	-	-
OTHER COMPREHENSIVE INCOME,
NET OF TAX	372		(684)
TOTAL COMPREHENSIVE INCOME	574		(947)

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5.3 Consolidated Statement of Cash Flow and Statement of Cash Flow of the Company for the Three Months Ended 31 March 2021 and for the Three Months Ended 31 March 2020

Consolidated Statement of Cash Flows For the three months ended 31 March 2021

(Amounts in millions of Renminbi, unless otherwise stated)

	Three months	Three months
	ended	ended
	31 March 2021	31 March 2020
	(Unaudited)	(Unaudited)
CASH FLOWS FROM OPERATING
ACTIVITIES
Cash received from premiums under direct
insurance contracts	148,828	145,215
Increase from policyholders' deposits	1,660	-
Other cash inflows from operating activities	2,810		4,428
Cash inflows from operating activities	153,298		149,643
Cash paid for claims payments under direct
insurance contracts	(79,766)	(59,098)
Decrease from policyholders' deposits	-	(3,621)
Cash paid for reinsurance, net	(1,471)	(1,251)
Handling charges and commissions paid	(13,995)	(16,746)
Interest paid to policyholders' deposits	(614)	(944)
Payment to and on behalf of staff	(13,209)	(12,203)
Taxes and surcharges paid	(3,710)	(4,777)
Other cash outflows for operating activities	(17,335)	(49,038)
Cash outflows for operating activities	(130,100)	(147,678)
Net cash flows generated from operating activities	23,198		1,965

- 24 -

	Three months	Three months
	ended	ended
	31 March 2021	31 March 2020
	(Unaudited)	(Unaudited)
CASH FLOWS FROM INVESTING
ACTIVITIES
Proceeds from disposals of investments	57,676	105,093
Cash received from investment income	13,793	10,786
Proceeds from disposals of fixed assets, intangible
assets and other long term assets	302		58
Cash inflows from investing activities	71,771		115,937
Payment for purchases of investments	(87,861)	(129,104)
Net increase in policy loans	(316)	(73)
Payment for purchases of fixed assets, intangible
assets and other long term assets	(625)	(1,939)
Other cash outflows for investing activities	(59)	(51)
Cash outflows for investing activities	(88,861)	(131,167)
Net cash flows used in investing activities	(17,090)	(15,230)

- 25 -

		Three months	Three months
		ended	ended
		31 March 2021	31 March 2020
		(Unaudited)	(Unaudited)
CASH FLOWS FROM FINANCING
ACTIVITIES
Cash inflows from debt issuance	-		8,000
Cash inflows from financing activities	-		8,000
Repayment of bank borrowings	(4)	-
Repayment of lease liabilities	(422)	(239)
Cash paid for distribution of dividends, profits or
interests	(675)	(305)
Other cash outflows for financing activities	(7,416)	(2,952)
Cash outflows for financing activities	(8,517)	(3,496)
Net cash flows (used in)/generated from financing
activities	(8,517)	4,504
NET FOREIGN EXCHANGE DIFFERENCES	(12)	27
NET DECREASE IN CASH AND CASH
EQUIVALENTS	(2,421)	(8,734)
Cash and cash equivalents at beginning of the
period		78,209		76,984
CASH AND CASH EQUIVALENTS AT END
OF THE PERIOD	75,788		68,250

- 26 -

Statement of Cash Flow of The Company For the three months ended 31 March 2021

(Amounts in millions of Renminbi, unless otherwise stated)

	Three months	Three months
	ended	ended
	31 March 2021	31 March 2020
	(Unaudited)	(Unaudited)
CASH FLOWS FROM OPERATING
ACTIVITIES
Other cash inflows from operating activities	153		79
Cash inflows from operating activities	153		79
Payment to and on behalf of staff	(163)	(149)
Taxes and surcharges paid	(6)	(1)
Other cash outflows for operating activities	(43)	(72)
Cash outflows for operating activities	(212)	(222)
Net cash flows used in operating activities	(59)	(143)
CASH FLOWS FROM INVESTING
ACTIVITIES
Proceeds from disposals of investments	2,137		2,467
Investment income received	205	165
Net cash inflow on disposal of a subsidiary	-		236
Cash inflows from investing activities	2,342		2,868
Payment for purchases of investments	(2,202)	(4,937)
Payment for purchases of fixed assets, intangible
assets and other long term assets	(13)	(1)
Other cash outflows for investing activities	(4)	(2)
Cash outflows for investing activities	(2,219)	(4,940)
Net cash flows generated from/(used in) investing
activities	123		(2,072)

- 27 -

	Three months	Three months
	ended	ended
	31 March 2021	31 March 2020
	(Unaudited)	(Unaudited)
CASH FLOWS FROM FINANCING
ACTIVITIES
Net cash inflow from securities sold under
agreements to repurchase	93		205
Cash inflows from financing activities	93		205
Interested paid	(2)	(2)
Cash outflows for financing activities	(2)	(2)
Net cash flows generated from financing activities	91		203
NET FOREIGN EXCHANGE DIFFERENCES	2		31
NET INCREASE/(DECREASE) IN CASH AND
CASH EQUIVALENTS	157		(1,981)
Cash and cash equivalents at beginning of the
period	768		3,003
CASH AND CASH EQUIVALENTS AT END
OF THE PERIOD	925		1,022

By Order of the Board

The People's Insurance Company (Group) of China Limited

Luo Xi

Chairman

Beijing, the PRC, 28 April 2021

As at the date of this announcement, the executive directors of the Company are Mr. Luo Xi, Mr. Wang Tingke, Mr. Xie Yiqun and Mr. Li Zhuyong, the non-executive directors are Mr. Wang Qingjian, Mr. Miao Fusheng, Mr. Wang Shaoqun, Ms. Cheng Yuqin and Mr. Wang Zhibin, and the independent non- executive directors are Mr. Shiu Sin Por, Mr. Ko Wing Man, Mr. Lin Yixiang and Mr. Chen Wuzhao.

- 28 -