China Life Insurance (601628.SH,02628.HK) has become the first Chinese insurer to obtain a private equity license which allows it to set up a private equity fund, reports caijing.com.cn.

The license allows China Life to invest in non-guaranteed bonds, fixed assets and the stocks of non-listed companies.

The total value of the investments are to be capped at up to five percent of China Life's total assets at the end of each quarter.

According to the report, as China Life had recorded total assets of 1.51 trillion yuan as of the end of the first quarter of 2011, it could invest up to 75.7 billion yuan in private equity.

The scale of China Life's total investments to date exceed 10 billion yuan, including investments in CITIC Securities (600030.SH), China Union Pay and Hangzhou Bank.

According to regulations, investments in enterprises which are highly pollutive, or with low-technology value-added are not allowed.

In addition, the funds cannot be invested in venture capital funds or be used to establish investment companies.

Equity investments are limited to investments in insurance companies, financial enterprises or enterprises in the pension, medical or automobile sectors.

China Life has set up a team of 20-30 employees to identify investment opportunities for its private equity business, according to the report.