News eDaily12 Apr 2017

China:Tighter regulation and supervision looming for insurers

| 12 Apr 2017

The CIRC has stated that it would tighten regulations for the insurance industry, adding that insurers should focus on their insurance business and regulators should strictly enforce regulations.

The regulator said in a statement on Monday that the insurance sector should guard against financial risks, support supply-side structural reform and help promote the development of the real economy.

The statement came after Premier Li Keqiang said on Sunday that the country's financial sector is vulnerable to risks such as bad assets, bond defaults, shadow banking and Internet financing, with frequent illegal and corrupt activities.

To bring order to the market, the Premier called for efforts to crack down on bank violations when it comes to extending credit, insider trading in the securities market and insurance fraud. He urged "relentless" punishment of internal supervisors and company managers who collude with major players in the market and steal and sell confidential information.

Mr Li's remarks came after the Chinese government announced on Sunday that Xiang Junbo, Chairman of the CIRC, was being investigated for suspected serious violations of the code of conduct of the Communist Party of China. Xiang is also Party chief of the CIRC.

Last December, China's Central Economic Work Conference cited preventing financial risks as a priority, and since then, regulators from the banking, securities and insurance sectors have acted to discipline the market.


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