CHINA LIFE INSURANCE CO LTD | CIK:0001268896 | 3

  • Filed: 4/25/2018
  • Entity registrant name: CHINA LIFE INSURANCE CO LTD (CIK: 0001268896)
  • Generator: Donnelley Financial Solutions
  • SEC filing page: http://www.sec.gov/Archives/edgar/data/1268896/000119312518130051/0001193125-18-130051-index.htm
  • XBRL Instance: http://www.sec.gov/Archives/edgar/data/1268896/000119312518130051/lfc-20171231.xml
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  • ifrs-full:DisclosureOfFairValueMeasurementExplanatory

    10 FAIR VALUE OF FINANCIAL ASSETS AND LIABILITIES

    The table below presents the carrying value and estimated fair value of major financial assets and liabilities, and investment contracts:

     

         Carrying value      Estimated fair value (i)  
         As at 31
    December
    2017
    RMB
    million
         As at 31
    December
    2016
    RMB
    million
         As at 31
    December
    2017
    RMB
    million
         As at 31
    December
    2016
    RMB
    million
     

    Held-to-maturity securities (ii)

         717,037        594,730        692,984        619,152  

    Loans (iii)

         383,504        226,573        375,899        231,005  

    Term deposits

         449,400        538,325        449,400        538,325  

    Statutory deposits - restricted

         6,333        6,333        6,333        6,333  

    Available-for-sale securities, at fair value

         789,897        745,586        789,897        745,586  

    Securities at fair value through profit or loss

         136,809        209,124        136,809        209,124  

    Securities purchased under agreements to resell

         36,185        43,538        36,185        43,538  

    Cash and cash equivalents

         48,586        67,046        48,586        67,046  

    Investment contracts (iii)

         (232,500      (195,706      (229,222      (192,373

    Financial liabilities at fair value through profit or loss

         (2,529      (2,031      (2,529      (2,031

    Securities sold under agreements to repurchase

         (87,309      (81,088      (87,309      (81,088

    Bonds payable (iii)

         —          (37,998      —          (38,204

    Interest-bearing loans and borrowings

         (18,794      (16,170      (18,794      (16,170
               

     

    (i) The estimates and judgements to determine the fair value of financial assets are described in Note 3.2.
    (ii) The fair value of held-to-maturity securities is determined by reference with other debt securities which are measured by fair value. Please refer to Note 4.3. The fair value of held-to-maturity securities under Level 1 was RMB55,137 million and that under Level 2 was 637,847 million as at 31 December 2017 (as at 31 December 2016: Level 1 RMB76,299 million and Level 2 RMB542,853 million).
    (iii) Investment contracts at fair value through profit or loss have quoted prices in active markets, and therefore, their fair value was classified as Level 1.

    The fair value of policy loans approximated its carrying value. The fair values of other loans, investment contracts at amortised cost and bonds payable were determined using valuation techniques, with consideration of the present value of expected cash flows arising from contracts using a risk-adjusted discount rate, allowing for the risk-free rate available on the valuation date, credit risk and risk margin associated with the future cash flows. The fair values of other loans and investment contracts at amortised cost, and bonds payable were classified as Level 3.