BEIJING, Dec. 3, 2009 (Xinhua News Agency) -- China's insurance industry is expected to witness a fast increase in its premiums growth and investment yields in 2010, according to analysts.

Thanks to the business restructurings of China's insurance giants, they have been able to improve their economic structures and growth of their new business values.

China Life Insurance Co. Ltd. (LFC.NYSE; 02628.HK; 601628.SH) and China Pacific (OOTC:CHNAQ) Insurance (Group)(CPIC, 601601.SH) focused on protection-type and dividend-type insurance products, while Ping An Insurance (Group) of China (02318.HK, 601318.SH) emphasized dividend-type and universal insurance products.

In the first three quarters of this year, China's life insurance market posted premiums growth of 4.04 percent.

Analysts predicted that life premiums would increase 6 percent this year, and the industry's investment yield would be over 5.5 percent.

Everbright Securities meanwhile predicted that premiums would grow 25 percent next year.

According to Shenyin & Wanguo Securities, universal insurance would become next year the major insurance product, given that the banking-insurance channel has been widened. Thanks to the industry's business restructuring, insurance companies will enjoy premiums growth next year.

In response to growing inflation and interest rates increase expectations, bonds yields may climb, which would pull insurers' investment yields along with them.

Equity investment yields will increase quickly next year, said Everbright Securities. According to the broker's forecast, Ping An's equity investment yield will reach 18 percent; that for CPIC 23 percent; and China Life's equity investment yield will hit 24 percent in 2010.

In addition, factors such as Taikang Life Insurance's listing plan, tax-deferred old-age insurance pilot programs, and Ping An's purchase of Shenzhen Development Bank (OOTC:SZDVF) (000001.SZ), would lift up the valuation of insurance companies.