Friday, March 23, 2018

China revamps insurance rules for more transparency

China has overhauled the regulations on shareholdings of the country’s insurers in a bid to increase their ownership transparency, as well as remedy problems like fake capital injection and illegal shareholding entrustment.

The nation’s insurance watchdog, the China Insurance Regulatory Commission, has expanded the number of provisions of the regulation from 37 to 94 and has implemented much more detailed rules to beef up regulations on issues, including the qualifications for insurers’ shareholders, ownership structure and fund authenticity.

The move by the insurance regulator is consistent with Beijing’s clampdown against risks in the country’s financial sector.

According to the new rules, which will take effect starting 10 April, the maximum stake a single shareholder can own in an insurer will be reduced to one-third of the insurer’s registered capital, from the current 51%.

A single asset management plan or a trust product also cannot hold more than 5% stake in an insurer.


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