Saturday, January 20, 2018

Low-rated insurers to face curbs in China

Insurance companies in China that have low ratings will face restrictions from the regulator, the official Xinhua news agency reported.

According to the report, the China Insurance Regulatory Commission is planning to restrict the businesses of insurers that have shown poor performance in asset liability management.

The regulator’s move happens at a time when a sector-wide clampdown on risk and graft is being implemented in China.

This clampdown has led to new ownership rules for insurers and the fall of the country’s chief insurance regulator, among other things.

The report said insurers in China will be rated from A to D by the regulator on their ability to ensure the matching of maturity, cash flow, and cost on both sides of their balance sheet.

Those with low ratings will not be allowed to do certain investment activities, the draft rules read.

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