HONG KONG (XFN-ASIA) - , the country's largest insurer, said its peers will not be a threat to the company's business development in the mainland's rural areas.

China Life vice president Lin Dairen told a news briefing that the company started to expand its insurance business in the rural areas during the past few years, and the development currently being carried out is on a large scale.

Lin said China Life is more competitive than other insurers in the rural areas given the company's experience and its tailor-made insurance products.

China Life competitor Ping An Insurance (Group) Co of China said last week it is looking at expanding into the mainland's rural counties in order to increase its market share.

Commenting on the volatile China stock markets, chief investment officer Liu Lefei said he expects the stock markets in China to continue to perform well in the near future on the back of a robust economy.

Liu added that strong earnings growth shown by China-listed companies will also support the bourses and provide further upside, which makes him bullish despite the markets having reached high levels during a recent rally.

China Life recorded strong investment growth in 2006, with net investment income rising 49.5 pct year-on-year to 24.94 bln yuan from 16.69 bln yuan.

Net investment yield for the period rose 41 basis points to 4.27 pct. Net fair value gains on assets were up at 20.04 bln yuan from 260 mln yuan previously.

Liu declined to comment on whether the company will raise the portion of equity investments, but noted that such investments will not exceed 20 pct of the investment portfolio as set under a government policy.

The company reported earlier that under international accounting standards, its 2006 net profit rose 114 pct year-on-year to 19.96 bln yuan, driven by strong investment and premiums income.

Chairman Yang Chao said the company set in 2005 a target for future operations to have stable business growth, aiming to drive premium income up by at least 20 pct year-on-year, which he said the company achieved last year.

Yang said the company will continue to strive to ahieve such pace of growth and aim to enhance its service quality, profitability and embedded value.

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