China Speeds up Legislation and Rectification for Insurance Industry

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Last updated at: (Beijing Time) Tuesday, February 05, 2002

China Speeds up Legislation and Rectification for Insurance Industry

China will continue to improve legislation for the insurance industry, and will quickly abolish, amend, correct and update existing laws and regulations, which do not meet with the requirements of the World Trade Organization (WTO),an high official said Monday in Beijing.

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More rules to regulate market

Speaking at a press conference, Ma Yongwei, chairman of the China Insurance Regulatory Commission (CIRC), said that his commission will focus on legislation necessary since China's entry into the WTO, including rules on punishing illegal insurance companies, administration of the insurance industry, including the administration of vehicle insurance and reinsurance.

Since last year, CIRC has clarified 8 rules covering 22 items, and issued laws on the administration of foreign funded insurance and rules on insurance agencies, which offered legal guarantees for authorization and supervision oof foreign funded companies and the sound development of the insurance agencies.

CIRC rectified market order

Moreover, CIRC made relevant rules to standardize insurance products and marketing. with more than 100 inspection teams spot-checking 392 property insurance branches, 415 life insurance branches, and 1,323 intermediate agencies, and 15 representative offices of foreign funded companies. It also checked more than 400,000 guarantee slips and 24,000 volumes of accounts.

So far, CIRC has banned 10 illegal branches and closed down more than 1,000 agencies. Pilot areas for vehicle insurance reforms were also launched in east China's Guangdong Province and Shenzhen.

China Rectifies Insurance Market

China Insurance Regulatory Commission (CIRC) July 19 revealed that from January to June this year, CIRC inspected 186 insurance branches, 3 agencies and 4 foreign insurance companies, revoking 9 firms' qualifications as agencies, punishing 24 senior management staffs and annulling 9 persons' posts.

According to reports, by the end of 2000, among the 10,000 senior management staffs in various insurance institutions, 20 percent were appointed without inspection approval. Personnel's "impure behavior" resulted in occurrence of various problems. So far, China registers a total of 10,000 insurance institutions, 4 percent, namely 400 institutions, were set up in breach of regulations. Full Story

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