CHINA Life Insurance Co., the nation’s largest life insurer by premiums, yesterday reported a 61 percent fall in first-quarter profit as investment income decreased due to a weak securities market.

Net profit for the three months ended March 31 fell to 3.47 billion yuan (US$495.2 million) from 8.89 billion in the year-ago period, the Hong Kong and Shanghai-listed company said.

Due to a plunge of the domestic stock market earlier this year, China Life booked a 5.5 billion yuan loss on the fair value of its investment portfolio, mainly in stocks, the company said.

That compared with a fair value gain of 3.9 billion yuan in the same period last year.

Shanghai’s stock market, on which China Life depends for a sizeable portion of its investment income, has dropped by around 32 percent since the start of the year on expectations of slowing income growth and rising interest rates to combat inflation.

China’s life insurance market, dominated by China Life and Ping An, has grown dramatically as the government dismantles a cradle-to-grave welfare system, although the rate of premium growth is slowing.

China Life raked in investment income of 15.1 billion yuan for the first quarter, a 10 percent decrease compared with a year earlier and the investment yield was 1.09 percent during the reported period. (SD-Agencies)