China's insurers earned 8.9 billion yuan (about 1.1 billion U.S. dollars) by investing insurance funds in the country's bullish stock market last year, the China Insurance Regulatory Commission has said..

The yield rate of stock investment by the whole insurance industry reached 27.1 percent, more than quadruple that of the whole returns on the insurance funds, said Sun Jianyong, director in charge of the use of insurance funds with the commission, at a conference Friday.

The insurance sector gained 93.2 billion yuan from all investments last year, with a yield rate of 5.82 percent and double that of 2005, said Sun.

"Heavy gains in returns on the insurance funds have created favorable conditions for the development of new insurance products and businesses," he noted.

He urged the insurance companies to further reduce the proportion of bank savings and increase stock investment to diversify the use of insurance funds.

The commission will strengthen risk control, improve the emergency response system of managing insurance assets and make innovations in stock investment and fund allocation, said Sun.

After a four-year recession, China's mainland stock markets began to rally at the beginning of 2006, with the benchmark Shanghai Composite Index continuously hitting new highs.

The index broke the 2,900-point mark on Jan. 22, compared with 1,255.77 points on January 23 last year.

Source: Xinhua