Insurance Group Should Control at Least 2 Insurers

Rules on the management of insurance groups were released by the China Insurance Regulatory Commission (CIRC), the top Chinese banking regulator, on March 24.

In detail, the rules involve insurance group's threshold, corporate management, capital management, information disclosure and related supervision. According to them, insurance groups should own qualified investors and the stake an insurance group takes in two or more insurance companies should be over 50 percent and among the controlled insurance companies, at least one should have been engaged in insurance for over six years and enjoy profit-making operation in recent three years. Its net assets should be not less than CNY 1 billion and total assets should be at least CNY 10 billion. The minimum registered capital should be CNY 2 billion.

An insurance group is allowed to control a company via its subsidiaries but is banned to control a company via subsidiaries of its subsidiaries. A top executive of an insurance group is allowed to serve in at most one of its subsidiary. Top executives of the group's subsidiaries are banned to serve in each other.