The Shenzhen-based insurer, in which HSBC Holdings owns a 19.9 percent stake, said after-tax profit rose to 4.23 billion yuan (HK$4.1 billion) in 2005 from 3.12 billion yuan in 2004.

Its turnover rose from 63.19 billion yuan to 64.59 billion yuan.

Ping An Insurance's profit growth beat analysts' forecast of 20 percent as the insurer, which sells both life and property and casualty policies, benefited from the rising gains from investment despite less premium incomes last year.

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Its gross written premiums and policy fees totalled 59 billion yuan in 2005, slightly lower than 60 billion yuan a year earlier.

However, its total investment income jumped 49.8 percent to 9.66 billion yuan last year from 6.45 billion yuan in 2004.

Ping An's interest income on held- to-maturity bonds rose 91 percent to 4.57 billion yuan last year from 2.39 billion yuan a year earlier.

The Shanghai T-Bond Index, which tracks government bonds, rose 3.5 percent in the second half of last year, compared with 1.4 percent a year earlier.

Chinese insurers are allowed to invest in limited channels of government bonds, bank deposits, domestic securities and stocks of overseas-listed mainland companies.

The government is set to allow the insurers to invest their capital into infrastructure projects which will benefit the insurers' long-term growth, said analysts.

The Shanghai Composite Index, which tracks yuan-denominated A shares and foreign exchange-denominated B shares, rose 7.4 percent in the second half of last year, compared with a loss of 9.5 percent during the same period a year earlier.

Ping An, whose 12-month target price was raised by Citigroup to HK$20 from HK$11 Wednesday, collected premiums of 13.7 billion yuan in the first two months of this year, a rise of 21 percent from a year earlier.

The share price of Ping An closed at HK$19.6 per share Wednesday, down 2.2 percent from a day earlier.

Chinese insurers got a combined premium of 493 billion yuan last year, up 14 percent from a year earlier.