In 2014, journalists from Japan's NHK documented the phenomenon of A Society Without Bonds, portraying how the elderly in an atomized society—devoid of social, familial, or community ties—gradually become isolated and ultimately pass away alone.

A decade later, the Japanese drama Two in the Neighborhood (Douban rating 9.3) offers a starkly different narrative. Its two 55-year-old female protagonists no longer treat aging with tragic solemnity; instead, they put on face masks, lift weights casually, and remark with ease: "Humans simply can't give up hope."

Japan, China's neighboring country, provides a vivid window into how attitudes toward aging have shifted from fear to composure amid profound, gradual demographic changes.

Young people are often captivated by youth, seldom envisioning their own twilight years. Yet the reality is that in twenty years, the silver-haired generation—now less visible in shopping malls and cinemas—will constitute a critical one-third of society.

According to the latest data from China's Ministry of Civil Affairs, by the end of 2024, the population aged 60 and above had reached 310 million, accounting for 22.0% of the total populace. This figure is projected to rise to around 30% by 2035.

While the morning sun has set, the evening glow still shines bright.

China's average life expectancy neared 79 years in 2024, continuing to increase by 2-3 years per decade. Concurrently, the older generation is moving beyond mindsets of self-denial and sacrifice, embracing their later years with positivity and savoring the depth and richness that time brings. Time, therefore, should be seen as a gift, not a burden.

From an industry perspective, the vast opportunities arising from the desire to "enjoy aging" in this longevity era are well-documented in developed nations. The U.S. Bureau of Labor Statistics, for instance, identified healthcare as one of the most promising sectors for 2017-2027.

A similar story is unfolding in China.

To address the industrial demands of a shifting demographic structure, China has established a personal pension system and piloted various commercial pension products, aiming to build a diversified payment framework for the senior care industry. Sectors like healthcare and wellness have emerged as new "blue oceans," attracting a steady stream of entrants.

The most notable pioneers are insurance companies—entities with substantial capital and the unique capability to integrate healthcare and wellness resources. We observe that the life insurance industry has entered a new round of competition for the senior care market. Among these players, forward-thinking leaders have been cultivating the senior care track for over a decade, building supply chain networks spanning wellness, medical care, and real estate. Their efforts have yielded a distinctly Chinese model, different from those in the U.S. or Japan.

For example, since 2007, Taikang Insurance Group has been exploring ways to extend insurance into tangible healthcare, senior living, and wellness services.

In the latest Fortune Global 500 ranking, Taikang Insurance Group climbed to 334th place, up 47 spots from the previous year. In his new book Strategy Determines Everything, Chen Dongsheng—founder, chairman, and CEO of Taikang—articulates an innovation that integrates physical services into the traditional two-dimensional framework of liabilities and investments, creating a "three-pronged synergy." He terms this model "New Life Insurance."

1. How to Plan for Old Age?

The UN's World Population Prospects 2024 reports that life expectancy has surpassed 75 years in half of all countries globally. By the late 2070s, the global population aged 65 and above is projected to exceed 2.2 billion.

Chen Dongsheng noted in his research for The Longevity Era that increased lifespans bring intense demands for funding and healthcare. Thus, the age of longevity is also an age of wealth and health. Following this logic, constructing a robust pension system is the most immediate challenge of this era. As life expectancy grows and the social dependency ratio tightens, the accumulated surplus of the basic pension fund for enterprise employees continues to decline, intensifying pressure on the system's sustainability.

Moshe A. Milevsky, a Canadian retirement research expert, emphasized in his book Pensionize Your Nest Egg that the foundation of personal retirement planning lies in income sustainability. Individuals must ensure they accumulate sufficient financial resources during their working years to support themselves throughout retirement.

This sustainability does not rely solely on frugal savings during one's prime.

Milevsky illustrates the point with an analogy: accumulating wealth is like filling a pool—its capacity depends on length, width, and depth. Similarly, one's ability to build wealth hinges on the term, principal, and rate of return of financial products. Given these "three core factors," long-term, compound-interest pension products have gained widespread popularity.

In the 1970s, the U.S. government incentivized employer and individual participation in the pension system through two key measures: first, adding Section 401(k) to the tax code, which offered tax advantages for employer-sponsored retirement plans (sparking the development of corporate pensions); second, establishing Individual Retirement Accounts (IRAs), laying the groundwork for the commercial third pillar of the pension system.

Among developed economies, the U.S. pension system is dominated by its second and third pillars, which account for over 90% of total assets. Japan's system, meanwhile, relies primarily on its first and second pillars, achieving "universal insurance and universal pensions for all citizens."

To address its own challenges of insufficient total pension assets and structural imbalance, China has also established a personal pension system. Pilot programs for innovative insurance products—such as exclusive commercial pension insurance and commercial pension plans—have delivered tangible results.

The Weighty Issue of Health

We cherish the richness and depth that time confers upon life, yet we cannot escape the afflictions of disease, loneliness, and frailty.

This is undeniably linked to individual constitution and the advancement of modern medicine. However, by stepping beyond traditional perspectives to redefine "health," we may uncover broader, more insightful answers.

Before the mid-20th century, the "biomedical model" dominated medicine, reducing illness to abnormal physiological indicators and focusing on correction through drugs or surgery.

While invaluable for combating infectious and organic diseases, this model's limitations became increasingly apparent as society developed: it overlooked psychological and social factors, failing to recognize that many chronic conditions are closely tied to emotional stress, cognitive patterns, and lifestyle choices.

In response, George Engel proposed the "biopsychosocial medical model" in 1977, advocating for understanding health and illness through the interplay of biological, psychological, and social factors. This model integrates prevention, healthcare, treatment, and rehabilitation into a holistic framework.

Long confined to theory due to technological constraints and systemic inertia, this approach is now being revitalized in today's longevity era, as the needs of the silver-haired generation shift from mere "survival" to "development and enjoyment."

As the demands of the elderly evolve, the senior care industry chain in many countries has matured, encompassing upstream players (investment, finance, and insurance with large capital pools), midstream entities (real estate and healthcare), and downstream support sectors (senior-specific products, tourism, and education).

Together, these elements form the systemic support for elderly health envisioned by Engel.

Today, the broader health industry is one of the largest globally. Medical and care services for the elderly and disabled are expanding rapidly, and community-based integrated senior care services are thriving.

2. The Rise of Institutions

It is evident that as the scope of demand widens, the elderly are shedding the stereotypical image of being self-sacrificing, restrained, and conservative. Instead, they are demonstrating diverse, individualized, and proactive needs.

Preferences regarding senior living arrangements offer a telling glimpse of this shift.

According to the Guide to a New Lifestyle for Aging Well—jointly released by Taikang Insurance and research firm AgeClub—a survey of 1,500 seniors showed a 17% year-on-year increase in visits to senior care communities in 2022. A growing number of older adults are actively abandoning traditional, solitary aging in favor of a high-quality, vibrant new life.

As hubs integrating pensions, real estate, and wellness, senior care institutions are a vital window into the longevity economy. Such assets have been common features in the aging trajectories of developed nations like the U.S. and Japan, with several distinct segments based on location, services, and profit models:

• Active Adult Communities (AACs): Originating from the real estate sector, these are typically located in scenic suburbs or resort areas. Their primary profit model involves selling property ownership, and they do not provide medical care. Essentially, they are real estate projects with specialized senior-friendly amenities—such as golf courses and swimming pools—catering to independent seniors. The renowned Sun City is a prime example.
• Nursing Communities (NCs): Catering to the physically or cognitively frail, or those with chronic illnesses, these communities are situated in areas with high elderly populations. They charge short-term rents, employ professional medical staff, and are equipped with advanced facilities to provide 24-hour care.
• Continuing Care Retirement Communities (CCRCs): Striking a balance between AACs and NCs, these communities offer independent living, assisted living, and skilled nursing care. Residents can receive continuous care within the same community even if their health declines. Revenue comes from entry fees and monthly rents, which vary significantly based on housing type and service level.

Japan also features a distinctive community-based model centered around "convenience stores."

Pioneered by retail giant Lawson, this approach leverages convenience stores to extend community care and health management services. Stores host consultation and product sales counters, providing professional advice and care support.

Unlike the U.S. and Japan, a significant number of China's high-quality senior care institutions are founded by life insurance companies.

This strategic choice is logically sound from an investment perspective: insurers naturally hold substantial cash reserves and are among the few players with the capital strength to integrate real estate, healthcare, and wellness resources. Furthermore, the long-term, stable returns of well-run senior care communities align perfectly with the long-dated liability profile of insurance capital.

Notably, top-performing CCRCs often yield returns superior to bonds while offering greater stability than stocks or commodities. U.S. commercial real estate firm CBRE reported that from 2004 to 2018, facility-based senior housing communities delivered an average annualized investment return of 14.6%, with asset appreciation and operational income contributing 7.6% and 7% annually, respectively—outperforming commercial real estate sectors like apartments, offices, and hotels.

3. Lessons from Abroad

Thanks to their inherent long-term, compound-interest nature—a natural fit for retirement planning—life insurers have the potential to lead in both the pension and senior care markets.

However, in the fiercely competitive U.S. market, the life insurance industry—once a dominant force—has long since lost its leading position.

During the critical period of rising life expectancy, U.S. life insurers failed to adequately prioritize the middle class, mistakenly believing that demand for annuity products from affluent individuals was the key to growth.

This misjudgment led the industry to largely miss out on the health insurance market. For instance, in 1995, MetLife sold its health insurance business for $1.5 billion, later finding itself unable to compete effectively in that sector. Meanwhile, the booming asset management and mutual fund industries further captured the savings needs of the middle class.

After setbacks in these two key markets, U.S. life insurers faltered in the pension arena.

Today, traditional life insurance premiums account for less than 30% of the pension system, down from a peak of nearly 80% in 1950.

Moreover, U.S. life insurance companies rarely make direct investments in senior living real estate.

The investment landscape for U.S. senior care communities is dominated by real estate developers and established REITs (Real Estate Investment Trusts). These entities either lease the communities to operators for rent or adopt a management contract model, paying operators 5-6% of revenue while bearing the risks themselves.

Sun City exemplifies the real estate developer-led model.

Its originator, developer Del Webb, noticed that Arizona's hot, dry, sunny climate was ideal for retirees from colder northern states. Seizing the opportunity, Webb began constructing communities tailored for this demographic.

At the time, the "active community" concept was nascent. A cautious Webb initially released a limited number of homes, complemented by a shopping center, recreation center, and golf course. On opening day, his community drew 100,000 visitors, causing traffic jams. Webb soon graced the cover of Time magazine.

Unlike in China, cash-rich U.S. insurers did not enter the market directly. Instead, they invested indirectly through REITs. For example, AIG invested in California CCRCs via REITs, and MetLife also holds indirect stakes in numerous senior living communities through healthcare REITs.

However, communities operated solely by real estate developers have inherent limitations.

The Longevity Era points out that both active communities and CCRCs create a sense of superiority through high-quality consumption, making residents feel their lifelong efforts have been rewarded. This reliance on a superiority-oriented mindset ties the industry's fate closely to a nation's economic strength, middle-class size, and pension system.

As lifespans extend, this high-consumption model—lacking integrated financial tools—inevitably faces the risk of retirees outliving their savings.

The U.S. experience offers two key lessons: First, facing the "blue ocean" of senior care, the life insurance industry must decisively seize the strategic window for developing pensions and the senior care industry. Second, a senior care community only achieves a true closed-loop of service and security when it incorporates a complete mechanism for recycling individual funds.

4. The "New Life Insurance" Model

The term "New Life Insurance" was first introduced by Chen Dongsheng during an academic conference in late 2023.

Shortly after, in a signed article titled Embracing New Life Insurance for High-Quality Industry Development, he elaborated on the concept. He proposed adding a "service end"—encompassing medical care, senior living, health, and wellness—to the traditional two-dimensional structure of liabilities and investments.

Later that year, in his book Strategy Determines Everything, he discussed the bottlenecks faced by the life insurance industry in mature Western markets, stressing that seizing strategic opportunities is key to achieving leapfrog development.

In the year that followed, this "New Life Insurance" model—restructuring the industry's value chain—sparked widespread discussion.

For years, senior care communities have been one of Taikang's most recognizable flagship offerings. In fact, many perceive Taikang first and foremost as a professional, high-end, and valuable senior care service provider, and only secondarily as a leading insurer.

Also in Strategy Determines Everything, Chen Dongsheng shares for the first time the original intent behind the company's senior care strategy, the doubts, challenges, and hardships faced during its execution, and the perseverance that followed. He condenses years of experience and reflection into the book's title.

For a long time, the primary contributor to the life insurance value chain has been the interest spread from the asset side.

But over the past two decades, global mature markets have been trapped in a low, even zero-interest-rate environment, putting long-term pressure on investment returns. China's life insurance industry has also entered a "deep-water zone" of transformation in the last five years, with diminishing marginal benefits across the value chain. Meanwhile, the advent of the longevity era presents new, unavoidable challenges for individuals concerning health and wealth in old age.

Thus, the entire industry faces immense pressure: the challenges are clear, but the path forward is not.

Failure to seize this critical strategic period could lead, at best, to a fate like the U.S. life insurance industry—relegated to a secondary role, ceding market share. At worst, companies could face bankruptcy due to interest spread pressure, potentially triggering systemic risk.

The "New Life Insurance" model, characterized by the three-pronged synergy of "Payment + Services + Investment," is Taikang's proposed solution.

By incorporating the "service end," Taikang's "Happiness Plan" insurance product provides long-term, stable cash flow, enhancing clients' ability to pay for future services. Comprehensive medical and wellness services, in turn, stimulate insurance sales, while high-return assets like senior care communities help alleviate "asset scarcity." Robust investment returns stabilize the interest spread, naturally boosting the competitiveness of the insurance products.

This increasingly detailed blueprint also explains why, while state-owned and centrally-administered enterprise giants have been slow to activate their senior care engines, Taikang embarked early on the "more challenging path" of building its own asset-heavy communities.

The book highlights several key milestones in Taikang's senior care journey:

• 2007: Identified senior care services during its search for a "second growth curve."
• 2009: Secured the first regulatory pilot approval from the China Insurance Regulatory Commission (CIRC) for a life insurer to operate a senior care community.
• 2012: Launched "Happiness Plan," its first large-scale annuity product linked to a senior care community, and began constructing its high-end community, Taikang Home•Yanyuan. This marked a breakthrough from the traditional life insurance model to a "payment + senior care services" approach.

Thereafter, Taikang's strategy crystallized. It moved into healthcare, building rehabilitation hospitals for each community, and expanded its service network into end-of-life care, forming three interconnected closed loops: Longevity, Health, and Wealth.

This journey was inevitably fraught with challenges best left unsaid.

On the title page of Strategy Determines Everything, Chen Dongsheng inscribed: "Pursue pure goals, stay single-minded, do the right thing—time is the answer."

As of 2025, Taikang has cumulatively invested more than RMB 50 billion in the construction and operation of healthcare and elderly-care services. In addition, over RMB 17 billion has been invested in companies across the broader healthcare ecosystem. Taikang Home has developed 47 projects in 37 cities nationwide, with a resident population exceeding 20,000.

The "Happiness Plan" has evolved into four systems: "Longevity Plan," "Health Plan," "Wealth Plan," and "Graceful Aging Plan," serving a total client base exceeding 300,000. Its team of Health and Wealth Planners has grown to over 20,000 members.

Genuine three-pronged synergy constitutes Taikang's unique "moat" in both the life insurance and senior care markets. From 2007 into 2025, Taikang is narrating not just a corporate story for the Chinese market, but a Chinese story for the global stage.

In 2025, amid economic transition, shifting growth drivers, industry transformation, and capital market pressures, Taikang continued to execute its "New Life Insurance" strategy. It achieved annual growth in revenue, new business value, and net profit, while maintaining sufficient solvency. Having navigated the senior care sector for nearly two decades, Taikang's industry-leading strategy has been consistently validated by time. The market has good reason to expect even greater value from "New Life Insurance" in the future.