Friday, September 22, 2017

Chinese ministries cooperate to discipline insurers

The China Insurance Regulatory Commission has signed a memorandum of understanding with 30 ministries and regulators to enlist their cooperation in cracking down on rule-breaking insurers.

The signatories, which include the People’s Bank of China, and the National Development and Reform Commission, have agreed to coordinate actions against such companies by restricting market access, among other punishments.

According to the MoU, insurers found violating rules will be restricted from establishing banking, securities and insurance subsidiaries.

They will also face restrained participation in government procurement and will not get as much government subsidies as those with good track records.

Regulators will also consider insurer’s violations in determining whether to grant them authority to issue securities in the future.

On a management level, individuals with poor records will also be disqualified from future senior executive positions.

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