The growing fervour over the listing of China Life Insurance seems to be generating its own set of unique statistics - 2.7 million application forms, 53 distributing banks and 250,000 prospectuses. The issue should raise upwards of $23 billion, giving China's biggest insurer a market capitalisation of $76 billion to $93 billion. In the melee caused by the biggest listing of the year, there seems to have been little time to question the details behind the numbers. The only number at the forefront of investors' minds is the level of oversubscription, or grey-market price. Brokerages have turned on the liquidity tap with offers of 90 per cent finance, struck at below Hong Kong's prime lending rate. This should boost the share price on its debut, although the laws of supply and demand mean not everyone can flip for easy gains. The number that seems to have received a little less attention is perhaps the most important number - the price. At $2.98 to $3.65, the price range values the company at 1.4 to 1.6 times book value and 14 to 17 times this year's earnings. That is not cheap, but comfortably falls within European insurer's average of 1.7 times book and 17.5 times earnings. But even these statistics give us only a snapshot in time, since investors are really buying the firm's growth story. What has captured investors' imagination is rampaging premium income being offered in China's fast-growing life insurance market. Here, China Life is king with a 45 per cent market share that saw premium income grow 60 per cent to 227.46 billion yuan last year from 142.4 billion yuan a year earlier. With 650,000 tied agents, even with new competition, it does not demand a great leap of faith to conceive the firm continuing to capture a hefty share. The sizeable listing prospectus provides a bit more colour behind China Life's headline numbers. One issue that had previously concerned investors was interest rate risk, due to a batch of policies written between 1996 and 1999 which commit the firm to pay policy holders high guaranteed rates of return. The issue was addressed by ring fencing the policies in a separate vehicle before listing. Nevertheless, interest-rate risk remains a worry and is highlighted in the prospectus. However, management suffers from restricted investment choices, limiting its risk-management options. In China, interest rates are still rigidly set by government agencies, as are the maximum returns life insurers can guarantee on their policies. The level of rates is a primary determinant of savings choices in a market such as China that offers few investment options. In the past few years, interest rates have remained at less than 2 per cent, so the low 2.5 per cent minimum guarantee on life policies has been attractive. While life insurance is typically a long-term commitment, China Life's growth has been aided by a substantial amount of policies based on one-off lump-sum payments. Such products are akin to a time deposit offered by a bank. Last year, such policies represented 48 per cent of new premium income. The concern is that growth from such products is tied to changes in interest rates. An upturn in China's interest rate cycle would be likely to trigger a rush of policy redemptions as holders sought higher returns. Relying on such instruments, rather than locking in long-term savings commitments from customers, demands that surrender penalties be carefully managed. Low interest rates have provided the impetus for China Life's stock offering. Long-term investors will need to distinguish between the sustainable story and what might be a more cyclical monetary phenomenon.