CIRC releases fund risk prevention rules

2004/05/15

The China Insurance Regulatory Commission (CIRC) has published risk prevention guidelines for the management of insurance funds by both insurance firms and their asset management subsidiaries.

The guidelines, which stress both practicability and creativity, require insurance firms and insurance asset management companies to establish risk prevention systems for their rapidly growing indemnity funds.

According to the guidelines, Chinese insurance companies are allowed to invest their growing premium incomes only in bank deposits, treasury bonds, policy bank bonds and some corporate bonds, which many believe restrains their profitability and undermines their ability to settle claims.



	Article featured in Business Beijing, May 2004 Publication sponsored by Information Office of the Beijing Municipal Government, Beijing Municipal Bureau of Commerce, Development & Reform Commission of Beijing Municipality, China Council for the Promotion of International Trade (Beijing Sub-Council)