China has set in motion an exercise to overhaul the country's insurance law and also strengthen the insurance regulations. The National Financial Regulatory Administration (NFRA) released a draft revision of the country's Insurance Law for public consultation on 4 September 2026.
According to a news report in the China Daily, the draft revision proposes stronger oversight of insurers and their shareholders, tighter prudential regulation and enhanced consumer protection amid growing complexity in the insurance sector. The new draft code is being termed as the most significant systematic overhaul since the law was last amended in 2015.
The draft comprises eight chapters and 214 articles. Key changes include: raising the minimum registered capital for insurers from CNY200m to CNY1bn ($149m); codifying at the statutory level for the first time that insurance funds may invest in equities, asset management products, gold, and futures derivatives; strengthening look-through supervision of shareholders and ultimate controllers, prohibiting nominee shareholding and improper interference in operations; enriching risk-resolution tools and refining the Insurance Security.
The NFRA said China's insurance market has developed rapidly in recent years, even as risks facing the sector have grown increasingly complex and diverse. As a result, shortcomings in the existing Insurance Law have become increasingly evident, making a comprehensive revision necessary to address prominent issues facing the development and regulation of the industry.
The revision focuses on strengthening institutional, conduct-based, functional, penetrating and ongoing supervision, while prioritizing the elimination of regulatory gaps, addressing shortcomings and clarifying regulatory mandates. It also seeks to put people first and improve the effectiveness of financial regulation across the board.
Among the main changes, the draft strengthens look-through supervision of shareholders, bringing both shareholders and actual controllers of insurance institutions within the scope of regulatory oversight.
The draft also seeks to improve the prudential regulatory framework by strengthening requirements for corporate governance, risk management and internal controls, while enhancing solvency regulation, asset-liability management and oversight of the use of insurance funds.
It further proposes improving risk-resolution mechanisms and refining rules governing risk disposal and market exit. Consumer protection would also be strengthened through improvements to insurance contract rules and clearer provisions prohibiting certain practices by insurance institutions.
In addition, the draft would raise the cost of violations by expanding the scope of legal liabilities and increasing the range of applicable fines.
Insurance industry experts said the draft would further broaden the scope for the use of insurance funds and provide insurers with a wider range of asset-allocation and risk-management tools.
The NFRA has said it will fully consider opinions and suggestions from all sectors of society, further revise and improve the relevant legal provisions, and actively work with the legislative authorities on subsequent procedures to facilitate the revision and enactment of the Insurance Law at the earliest possible date. The public can submit its comments till 3 October 2026.