China Life, the country’s second-biggest insurer by market value, said net profit rose to 32.25 billion yuan ($5.09 billion) last year from 19.13 billion yuan a year earlier.
Analysts on average were expecting a net profit of 30.8 billion yuan, according to Thomson Reuters data.
In 2017, returns on investment grew 19 percent from a year earlier, hitting 129 billion yuan, while total insurance premiums were also up 19 percent to 512 billion yuan.
Analysts said the growth in premiums was in part down to regulatory efforts to rein in smaller, riskier insurers.
Last year, Chinese insurers pulled in 3.66 trillion yuan of insurance premium income, up 18.16 percent from the end of 2016, the China Insurance Regulatory Commission said in an official notice.
But China Life, along with China’s other insurers, faces a tough year ahead.
Regulatory scrutiny has tightened amid an industry-wide crackdown on risk, with increased oversight of more leveraged areas of business.
The government earlier this month said it would merge its banking and insurance regulators in a long-awaited move to streamline and tighten oversight of the financial system in the world’s second-biggest economy.
Before the results, Iris Tan, senior equity analyst at Morningstar Equity Research, said China Life was still trying to reduce its business sensitivity to fluctuating interest rates and investment returns.
“The pace of its transformation is slower than peers, as its huge and rapidly growing agent force makes productivity improvement more difficult than for peers,” Tan said.
Tan expects a year-on-year decline in first-quarter sales due to the insurance regulator’s new rules on the sale of short-term investment insurance products, titled document 134, which will impact the wider industry.
($1 = 6.3300 Chinese yuan renminbi)
Reporting by Engen Tham in SHANGHAI and Shu Zhang in BEIJING; Editing by Mark Potter