BEIJING - China Life Insurance Co Ltd, the country's largest insurer, posted sharply slower profit growth last year as reduced interest rates affected balance sheets.

The company earned 34.7 billion yuan ($5.3 billion) in net profits attributable to shareholders, up 7.7 percent year on year, according to its annual report filed to the Shanghai Stock Exchange on Wednesday.

It was down from a 30.1 percent net profit increase recorded in 2014.

A rise in investment returns was the major driver for profit growth in 2015, but this was offset by higher claims reserves the company had to set aside, the report said.

Claims reserves are shown as liabilities on the balance sheet and are sensitive to interest rate changes. Many life insurance policies offer guaranteed interest rates and insurers need to earmark more money for future claim payments if the actual rates go down.

China's central bank reduced the benchmark interest rates five times in 2015 to prop up the slowing economy.

China Life said its revenue rose 14.7 percent year on year to 511.4 billion yuan in 2015, with premiums up 9.8 percent to 362.3 billion yuan.