(Yicai Global) July 19 -- New China Life Insurance Co. [SHA:601336; HKG:01336] -- commonly called Xinhua Insurance -- is amid a business transformation.

Its original gross premium (OGP) fell 13.8 percent per year to USD9 billion (CNY61.2 billion) in the first half, showing its revenue decline has kept decelerating compared with previous months, a recent report on premium income states.

The company posted negative OGP growth in the first half because of the business transformation. This was mainly attributable to a major fall in lump-sum premiums in the bank assurance business resulting from premium restructuring, Changjiang Securities [SHE:000783] noted. However, the first-half decrease is smaller than the monthly falls recorded thus far this year. From January through May, the monthly drops in Xinhua Insurance's OGP ranged between 17 percent and 30 percent, with negative growth consistently slowing each month, China Insurance Regulatory Commission (CSRC) said, citing statistics.

The deceleration  primarily results from a continuous increase in monthly premium income. The company's OGP is estimated at CNY11.085 billion for last month, up 71 monthly percentage points and 8.56 percent annually.

Xinhua Insurance rallied by 47.87 percent on the A-share market between April 18 and July 18, and closed at CNY61.56 yesterday, data provided by wind.com show.

Judging by external market conditions, strict regulation has become the norm, prompting insurance companies to transform their existing business structures, said Wan Feng, chairman and chief executive at Xinhua Insurance, at a recent internal meeting on business performance in the first half. Furthermore, market concentration is set to further increase, which will lead to major changes in the competitive landscape in the life insurance industry. Looking at the company itself, Wan added, Xinhua Insurance has achieved some initial results with its business transformation initiative, but the foundation of business restructuring still awaits further consolidation.

The company's 13th 'Five-year Plan' dictates that its business transformation should conclude by the end of this year, and the firm will embark on a new phase of development starting next year.