Perspective on the amendment of insurance law: broadening the channels for the use of insurance funds
Xinhuanet Beijing, August 25th (Reporter Mao Xiaomei, Wu Jingjing) China’s current insurance law stipulates that the use of insurance funds is relatively narrow. However, in recent years, with the increasing scale of the insurance market, the rapid accumulation of insurance funds has become a bottleneck for the development of the insurance industry because of the narrow channels of application and the difficulty of maintaining and increasing value.
Wu Dingfu, chairman of the China Insurance Regulatory Commission, explained the revised draft of the Insurance Law at the fourth meeting of the 11th the National People’s Congress Standing Committee (NPCSC) on 25th, saying that the revised draft appropriately broadened the channels for the use of insurance funds, considering that the use of insurance funds should not only meet the needs of industry and economic development, but also take into account the principles of safety and stability. For example, the "buying and selling government bonds and financial bonds" stipulated in the current insurance law is revised to "buying and selling bonds, stocks, securities investment funds and other securities"; It is added that insurance funds can be invested in real estate.
In order to prevent risks in the use of insurance funds, the revised draft also authorizes the State Council insurance regulatory agencies to formulate management measures for the use of insurance funds in the form of authorization clauses, including stipulating the specific proportion of funds invested by insurance companies in a specific project to their total funds.
In fact, the investment of insurance funds in stocks and funds has already been broken through in practice. In recent years, according to the decision of the State Council and the actual needs of the development of the insurance industry, the China Insurance Regulatory Commission (CIRC) combined with the provisions of the current insurance law "other forms of capital utilization stipulated by the State Council", A series of regulations and normative documents, such as Interim Measures for the Administration of Insurance Companies Investing in Securities Investment Funds, Interim Measures for the Administration of Insurance Companies Investing in Corporate Bonds, Interim Provisions for the Administration of Insurance Asset Management Companies, Interim Measures for the Administration of Overseas Use of Insurance Foreign Exchange Funds, and Interim Measures for the Administration of Stock Investment of Insurance Institutional Investors, have been issued successively. While broadening the channels for the utilization of insurance funds and trying to innovate the organizational form of fund utilization, they have achieved a good balance between safety and efficiency and effectively prevented the risk of fund utilization. At present, insurance companies have become one of the most important institutional investors in the domestic capital market.
"The revised draft of the Insurance Law is the new investment channel approved by the State Council in recent years." Yang Huabai, director of the regulatory department of the China Insurance Regulatory Commission, told reporters.
As for the insurance law’s plan to "open the gate" for the first time to invest in real estate with insurance funds, the relevant person of the China Insurance Regulatory Commission said that the scale of real estate investment is large and the term is long, which is more in line with the characteristics of insurance funds pursuing long-term, valuable and steady investment. Opening this channel can give play to the capital financing function of insurance, support the national economic construction, optimize the insurance asset structure and cultivate a new profit model for the insurance industry. In practice, some insurance companies have tried to invest in developing commercial real estate.
Yang Huabai said that for the regulatory authorities, the implementation of any new investment policy must be based on effective prevention and control of risks. "Once the law allows investment in real estate, the CIRC will first limit the proportion of this investment in the company’s total funds in the future and formulate a specific method for real estate investment." Because the insurance industry’s investment in real estate is still unfamiliar and lacks professional experience, it is necessary to adhere to the system first and advance steadily.
According to the announcement, there are more than 100 Chinese and foreign insurance companies in China, and the total assets of the insurance industry are about 3 trillion yuan. In 2007, the balance of insurance funds in China reached 2.7 trillion yuan, which was 10.5 times that of 2000.
It is understood that in recent years, emerging insurance organizations such as cooperative insurance institutions and mutual insurance institutions have appeared in the insurance market. This revised draft adds provisions that insurance organizations in the form of mutual system and cooperative system shall be stipulated separately by laws and administrative regulations, and the provisions of this law shall apply to their insurance business activities. Thereby giving legal status to insurance organizations such as mutual system and cooperative system.
It is also known that the quality of insurance companies directly relates to the interests of the vast number of policyholders, insured and beneficiaries. In order to improve the quality of insurance companies, in this revision, the insurance law intends to make stricter provisions on the conditions for the establishment of insurance companies, and will clearly state the qualifications of company executives.
The revision of insurance law intends to improve the management of insurance intermediaries.
Xinhuanet Beijing, August 25th (Reporter Wu Jingjing, Mao Xiaomei) With the development of the insurance market, some new types of insurance intermediary service institutions have emerged in China, such as insurance assessment institutions, which need to be regulated by law. The revised draft of the Insurance Law, which was deliberated at the fourth session of the 11th the National People’s Congress Standing Committee (NPCSC) on 25th, further improved the management of insurance intermediaries.
When explaining the revised draft, Wu Dingfu, chairman of the China Insurance Regulatory Commission, said that the provisions of the current insurance law on insurance intermediaries are relatively simple, and there are some gaps in both the subject and the code of conduct.
According to reports, the revised draft clarifies that part-time insurance agency is an important form of insurance agency to solve the problem of unclear legal status of part-time insurance agency; It is clear that insurance assessment institutions are insurance intermediaries, and the registered capital, employees and business rules of their business scope are stipulated; Considering the characteristics of individual insurance agents, the revised draft deletes the provisions in the current insurance law that individual insurance agents should obtain insurance agency business licenses, handle industrial and commercial registration, obtain business licenses, deposit deposits or take out professional liability insurance, and only stipulates that individual insurance agents should meet the qualifications stipulated by the State Council insurance regulatory authorities and obtain qualification certificates; The legitimate business activities of individual insurance agents shall not be investigated and dealt with without a license.
China revises insurance law to crack down on insurance violations
Xinhuanet Beijing, August 25th (Reporter Wu Jingjing, Mao Xiaomei) China’s current insurance law is not perfect in terms of penalties for insurance violations, and there is a lack of penalties for some illegal acts, which makes illegal acts unable to get due sanctions. The revised draft of the Insurance Law, which was reviewed at the fourth session of the 11th the National People’s Congress Standing Committee (NPCSC) on 25th, further clarified the legal responsibilities and cracked down on insurance violations.
Wu Dingfu, chairman of the China Insurance Regulatory Commission, said that with the continuous development of the insurance market, on the one hand, it is necessary to provide corresponding penalties for some new insurance violations, and on the other hand, it is necessary to improve the penalties in the existing insurance law.
The revised draft of the insurance law has increased the punishment for new illegal acts. New illegal acts mainly include illegal appointment of directors, supervisors and senior managers; Insurance companies and their staff make false claims by means of fictitious contracts to defraud insurance money or other illegitimate interests; Lease, lend, alter or transfer the business license; Insurance companies and their staff engage in related party transactions in violation of regulations, fail to disclose information in accordance with regulations, fabricate and spread false facts, etc., which damage the business reputation of competitors and disrupt the order of the insurance market; Insurance companies and their staff misappropriate and occupy insurance premiums and use insurance intermediaries to engage in illegal acts; Insurance intermediaries conceal important information related to insurance contracts, force, induce or restrict the insured to conclude insurance contracts by improper means, and fail to pay insurance money or take out professional liability insurance in accordance with regulations; Foreign insurance institutions set up representative offices in China without approval to engage in insurance business.
The revised draft also increases the accountability of those responsible for illegal acts, and stipulates that insurance companies, insurance asset management companies and insurance intermediaries engage in illegal activities. In addition to punishing illegal institutions, insurance regulators can also take measures such as canceling their qualifications and implementing market bans for their directly responsible directors, supervisors and senior managers. Insurance salesmen, personal agents and employees of insurance intermediaries who violate the law can be warned, fined, their qualification certificates revoked and banned from the market.
In view of the actual situation of various economic sectors investing in the insurance industry, in order to prevent investors from using insurance companies as financing tools, the revised draft draws lessons from the legislation of other countries and regions, and stipulates that if an insurance company’s assets are insufficient to pay off its debts due to its illegal operation, its directors, supervisors, general manager and deputy general manager responsible for deciding the business shall be jointly and severally liable to the company’s creditors.
On the basis of the current insurance law, the revised draft increases the restrictions on the administrative behavior of insurance supervisors, and stipulates the corresponding legal responsibilities for the illegal acts of supervisors in approving institutions, approving insurance clauses and rates, conducting on-site inspections and taking compulsory measures.
China revises insurance law and strengthens self-discipline management of insurance industry.
Xinhua News Agency, Beijing, August 25th (Reporter Wu Jingjing, Mao Xiaomei) A chapter "Insurance Industry Association" was added to the revised draft of the Insurance Law, which was deliberated at the fourth session of the 11th the National People’s Congress Standing Committee (NPCSC) on August 25th, and the legal status and main responsibilities of insurance industry associations were stipulated.
"In order to promote the transformation of government management functions, improve insurance supervision methods and make effective use of supervision resources, we should give full play to the role of insurance industry associations as a self-regulatory organization." Wu Dingfu, chairman of China Insurance Regulatory Commission, said. The revised draft stipulates that the insurance industry association is a self-regulatory organization of the insurance industry and a social group legal person. An insurance company shall join an insurance industry association. Insurance agents, insurance brokers and insurance assessment institutions may join insurance industry associations.
The revised draft also stipulates the responsibilities that insurance industry associations should perform, including safeguarding the legitimate rights and interests of members in accordance with the law and reflecting the suggestions and requirements of members to insurance supervision and management institutions; To mediate disputes between members, members and policyholders, insured and beneficiaries; Members who violate the articles of association of the insurance industry association and the self-discipline rules of the industry shall be given disciplinary sanctions in accordance with the regulations. (End)
The amendment of insurance law intends to improve the market exit mechanism of insurance companies
Xinhuanet Beijing, August 25th (Reporter Wu Jingjing, Mao Xiaomei) The revised draft of the Insurance Law, which was deliberated at the fourth session of the 11th the National People’s Congress Standing Committee (NPCSC) on the 25th, further improved the market withdrawal mechanism of insurance companies.
The current insurance law has made some provisions on the cancellation and bankruptcy of insurance companies. In order to maintain the order of the insurance market and public interests, the revised draft, on the basis of the existing provisions, adds provisions that insurance companies have illegal operations, poor management or solvency lower than the standards set by the State Council insurance regulatory agencies. If the insurance company is not revoked, it will seriously endanger the order of the insurance market and damage the public interests. The insurance regulatory agency of the State Council will revoke it and organize a liquidation team in time to conduct liquidation according to law.
According to the relevant provisions of the Enterprise Bankruptcy Law, the revised draft also provides for special matters concerning the bankruptcy of insurance companies, mainly including: stipulating that the State Council insurance regulatory agencies can apply to the people’s court for reorganization or bankruptcy liquidation of insurance companies; The order of debt settlement in bankruptcy liquidation of insurance companies is further clarified.
Editor: Meng Xu