Limits to be relaxed soon for insurers

08:56, May 27, 2010      

Email | Print | Subscribe | Comments | Forum 

The China Insurance Regulatory Commission (CIRC) will loosen the limits on investments by insurance companies in stocks and bonds, but may be cautious on permitting property investments, a CIRC official said on Wednesday.

"We are in discussions to allow major insurers to invest 20 percent of their assets into stocks and equity funds, and increase their investments in unsecured bonds to 20 percent from 15 percent," Sun Jianyong, head of the capital management department of CIRC told China Daily.

Currently, insurers are allowed to invest 20 percent of their assets into stocks, equity funds and debt funds.

"Since debt funds usually account for a small proportion of the 20 percent investment basket, the loosening is just a signal. It is hardly expected to boost the stock market and insurers' investment returns," said Wang Xiaogang, a senior analyst with Shanghai-based Orient Securities.

According to CIRC data, the premium income of insurers rose 13.8 percent to 1.1 trillion yuan last year, with total assets touching 4.1 trillion yuan.

Industry insiders said the loosening may bring around 10 billion yuan of capital into China's stock market.

The Shanghai Composite Index, which tracks the bigger of China's stock exchanges, gained 3.16, or 0.1 percent, to close at 2625.79 on Wednesday.

"We are more keen to see the detailed rules governing investments in property and private equities," said a manager at a leading insurance asset management company.

But according to Sun, the launch of the detailed rules, especially the one on property investment, may still take some time.

Though the CIRC opened property as a new investment channel after the revised insurance law came into effect from Oct 1 last year, the detailed rules are yet to come out and hence effectively bars insurers from making such investments.

Wu Dingfu, chairman of the CIRC, said early this year that insurers would not be allowed to invest in residential buildings or be involved during the property development stage.

At the same time, the CIRC said insurers would not be allowed to make direct investments in the nation's commercial property sector.

Source: China Daily

(Editor:黄硕)

  • Do you have anything to say?

双语词典
dictionary

  
Special Coverage
  • Premier Wen Jiabao visits Hungary, Britain, Germany
  • From drought to floods
Major headlines
Editor's Pick
  • Rescue workers and local residents search for survivors after a building collapsed in old Delhi, India, Sept. 27, 2011. At least 10 people were killed and 35 injured when an old three-storey building collapsed. More than a dozen people are still feared trapped under the debris, police said. (Xinhua/Partha Sarkar)
  • A visitor has flying experience in the windmill castle of Jinshitan National Holiday resort in Dalian, northeast China's Liaoning Province, Sept. 27, 2011. The castle is a 23-meter-high building with 21 meters in diameter. The castle uses wind tunnel to make objects floating in the air. It is the first indoor stadium in China, which enables people to have flying experience. (Xinhua/Zhang Chunlei)
  • An Indian artist colours clay idols of Goddess Durga for the upcoming Durga Puja festival in Calcutta, capital of eastern Indian state West Bengal on Sept. 27, 2011. The festival celebrates the homecoming of Mother Goddess Durga and the victory of good over evil, dramatized by the goddess' demolition of the evil buffalo demon, Mahishasura. (Xinhua/Tumpa Mondal)
  • A model presents a creation of new upcoming designer Sergei Grinko at the Milan Fashion Week Women's Wear Spring/Summer 2012 in Milan, northern Italy, Sept. 27, 2011. The Milan fashion week closed on Tuesday. (Xinhua/Wang Qingqin)
  • Yu Guangyao (2nd R), president of Shanghai Shentong Metro Co., Ltd, bows his apology at a press conference on the subway trains collision accident happened Tuesday afternoon, in east China's Shanghai Municipality, Sept. 27, 2011. By 8:30 p.m. (1230 GMT) Tuesday, a total of 271 injured people in the accident have received medical treatment in hospitals, among them 180 have been dispatched. Other 61 injured people are still in hospital, in which 30 are under emergency observations. No critical injuries have been reported. (Xinhua/Chen Fei)
  • Children visit the Confucian temple in Tainan, southeast China's Taiwan, Sept. 27, 2011. A ceremony will be held at the temple to commemorate Confucius (551-479 BC) on Sept. 28, the birthday of the ancient Chinese thinker and educationist and the annual Teacher's Day of Taiwan in honor of him. (Xinhua/Ren Zhenglai)
Hot Forum Discussion