Has a trust gap already emerged for Yuanbao amid high-performance growth?

As Consumer Rights Protection Day approaches on March 15, the internet insurance platform “Yuanbao” is standing at a delicate crossroads.

Last April, Yuanbao was listed on NASDAQ in the United States, and its current development stage has attracted significant attention. While the company demonstrates strong growth resilience, it is also facing the common challenges in the internet insurance industry—balancing efficiency and compliance.

PART 01

Impressive Performance

Currently, Yuanbao has not released its full-year financial statements for 2025, but in the publicly available Q3 2025 financial report, the company maintained a solid growth trend in revenue and profit.

In the third quarter of 2025, Yuanbao’s total revenue reached 1.158 billion yuan, a 33.6% year-over-year increase, with a net profit of 370 million yuan, up 51.3%. Amid the overall pressure on the insurance industry’s growth, this performance is remarkable. As of the end of September 2025, Yuanbao’s cash reserves stood at 3.75 billion yuan, an 82.3% increase year-over-year. This data also confirms the company’s growth resilience driven by AI-powered operations and product innovation.

On the technology front, Yuanbao has built an AI-driven full-cycle service engine. By the end of 2024, this engine had developed approximately 4,700 internet models and 4,900 user data tags, covering the entire process from user acquisition to after-sales service, establishing a solid technological moat.

In claims services, the company’s January 2026 annual claims report shows that through product innovation, the fastest settlement time for medical insurance claims has been shortened to 3.4 minutes. Additionally, a research report by Citibank, which first covered Yuanbao, identified it as a leader in China’s health insurance sector, indicating recognition of its market position and technological advantages by global institutions.

PART 02

Pain Points Behind Performance Growth

Behind Yuanbao’s efficient growth, its core issues cannot be ignored.

On one hand, on the Black Cat Complaint Platform, over 1,200 complaints related to Yuanbao mainly focus on “unexplained charges,” “unknown policy purchases,” and “claims communication.”

Some users reported being misled by advertisements like “first month for 1 yuan” or “free claim” while browsing short videos or mini-programs. Without clear disclosure of actual premiums, prominent automatic renewal prompts, or full display of insurance terms, they were defaulted into insurance purchases and charged without awareness.

While such phenomena may result from violations by certain third-party channels, has Yuanbao fulfilled its obligations and responsibilities in channel management and user authorization verification?

On the backend, regarding claims, although Yuanbao claims its AI claims system can process claims as quickly as 3.7 minutes, many user complaints point to an unavoidable issue: in small or standardized claims, Yuanbao indeed achieves high efficiency. But when it comes to complex cases or non-standard users, can the claims process still remain so simple and efficient? Slow customer service responses, difficulty in tracking progress, lengthy and opaque document requirements—all are concerns users want addressed urgently.

User concerns about post-purchase claims are critical. If the service experience stalls after purchase, some users may feel “tricked,” even damaging the entire brand’s trust.

However, it should be noted that these complaint cases are common across the internet insurance industry. According to a report by the “Economic Daily” at the end of last year, the Shanghai Consumer Protection Committee, in collaboration with Fudan University, conducted a review of mainstream internet insurance products in May 2025. The results showed issues such as ambiguous product names, insufficient information disclosure, and lack of human customer service. Some products also featured “weakened complex clauses” and “diluted key risks.”

Chen Hui, director of the China Actuarial Science and Technology Laboratory at Central University of Finance and Economics, stated that these phenomena are not isolated but reflect structural contradictions emerging during the rapid expansion of internet insurance.

Notably, some issues raised in Yuanbao-related complaints have been resolved. After continuous charges, some users received full refunds following communication with Yuanbao’s platform. This indicates that the company is improving its mechanisms for protecting user rights rather than ignoring complaints.

PART 03

How to Balance Scale, Efficiency, and Compliance?

For Yuanbao, maintaining rapid growth likely depends on extensive traffic cooperation channels. To control costs, automation technology must be employed to improve efficiency. However, combining these approaches can easily lead to neglecting user rights protections.

Any problem—be it violations by third-party partners or flaws in system authorization—can trigger numerous user complaints. If such complaints are amplified by public opinion, especially around sensitive dates like March 15, the company’s reputation could suffer serious damage.

Currently, the internet insurance industry is entering a new phase of “refinement.” According to the “China Internet Insurance Development Report (2024),” the scale of internet insurance premiums in China grew at an average annual compound rate of over 30% from 2013 to 2023. However, future growth is expected to stabilize at around 15-20% annually over the next five years. This indicates that industry growth is becoming more rational, and product design and service capabilities will become key factors in long-term competitiveness.

Regulatory-wise, the former China Banking and Insurance Regulatory Commission’s “Internet Insurance Business Supervision Measures” explicitly prohibit practices like “default opt-in” and “coercive bundling,” which undermine consumer choice. This underscores that compliant operation is a prerequisite for sustainable development in internet insurance.

Looking at Yuanbao’s platform, in February 2026, on its sixth anniversary, the company released a brand video emphasizing its dual strategy of “technology-driven insurance inclusion,” focusing on “expanding coverage” and “enhancing value.” The company also plans to expand overseas markets and deepen technological innovation in 2026. These initiatives could become future growth drivers.

Conclusion:

Reviewing Yuanbao’s development, it demonstrates that technology can significantly improve operational efficiency. In a challenging industry environment, Yuanbao’s ability to sustain high growth suggests it has established a scalable profit model. Additionally, research reports from Citibank and other reputable institutions recognizing Yuanbao reflect market acknowledgment.

Of course, compliance remains the foundation for industry development. Given the professionalism and long-term nature of internet insurance, building user trust is paramount. Balancing efficiency and user experience—ensuring transparent, controllable service processes and clear product understanding—is a critical challenge not only for Yuanbao but for the entire industry.

It is worth noting that Yuanbao has already recognized these issues and continues to invest in product innovation and service optimization. With improved regulation and corporate growth, it is believed that internet insurance companies like Yuanbao will eventually overcome cycles and create real value for users.