China Life Insurance reports massive profit jump
China Life Insurance Co Ltd, one of the country's largest insurers, reported a 228.6 percent jump in first-half net profit, as stronger investment returns and growth in new business value boosted earnings.
Net profit attributable to shareholders reached 134.49 billion yuan ($18.8 billion) in the six months ended June 30, according to the company's interim report.
New business value, a key measure of the expected profitability of newly sold policies, rose 33.7 percent year-on-year to 38.17 billion yuan. Embedded value, a measure of the insurer's long-term value, reached 1.61 trillion yuan.
Investment performance was a major driver of the earnings increase. Total investment income rose to 314.50 billion yuan, while its total investment return increased 229 basis points year-on-year to 5.58 percent.
China Life increased its allocation to stocks and non-money market funds, which accounted for 19.14 percent of investment assets at the end of June, up from 16.89 percent at the end of last year. Investment assets rose 7 percent over the period to 7.95 trillion yuan.
The insurer said it would maintain a long-term, value-oriented and prudent investment approach, while improving asset allocation and coordination between its insurance liabilities and investment assets.
Total premium income rose to 536.63 billion yuan in the first half, with premiums from new policies increasing 11.6 percent to 180.04 billion yuan.
First-year regular-premium income exceeded 100 billion yuan for the first time in a six-month period, reaching 101.29 billion yuan, up 24.7 percent. Premiums from policies with payment periods of 10 years or more rose 19.2 percent to 36.121 billion yuan, reflecting the company's push towards longer-duration policies.
China Life's total assets exceeded 8 trillion yuan for the first time, reaching 8.09 trillion yuan at the end of June. It proposed an interim dividend of 3.58 yuan per 10 shares, for a total payout of 10.119 billion yuan, up 50.4 percent year-on-year.
