(Yicai Global) June 19 -- Big Chinese insurers are gaining from the country's recent interest rate cuts as more residents shift to life insurance products that still pay better than time deposits.

Six large life insurers earned about CNY130.5 billion (USD18.3 billion) in premiums in May, rising by almost 14 percent from a year ago, Yicai Global learned. The year-over-year pace of increase accelerated by around 9 percentage points from April.

As the rates of three-year and five-year time deposits have dropped below 3 percent, life insurance products that promise a rate of 3.5 percent are becoming more attractive, an insurance professional said to Yicai Global.

Before the central bank lowered key policy rates last week, many commercial lenders cut their rates for fixed-term savings account-like products. Consequently, more clients have come to consult about related insurance products, according to the above-mentioned source. 

However, the pressures are predicted to be passed on. Residents were eager to buy protections to ensure their return on assets in May amid the declining interest rates ahead of an expected adjustment to insurance rates, Guotai Junan Securities pointed out in its latest research report. 

Yicai Global learned from a market insider that the 3.5-percent life insurance products will be replaced by 3 percent policies. Since late April, new products with the higher rate have not been approved and the existing products will no longer be available after June, the person said. Thereby, sales staff at many firms are quick to remind potential clients that the closing window of higher returns is an opportunity not to be missed.

Still, premiums are predicted to narrow growth in the short term and insurers' quarterly performance will be affected even though the low-interest rate environment drives residents to invest in long-term products, analysts said.

Editors: Liao Shumin, Emmi Laine