Insurance laws China
China's insurance sector is governed by a comprehensive legal framework aimed at regulating insurance activities, protecting stakeholders, and ensuring industry stability. The primary legislation is the Insurance Law of the People's Republic of China, which has undergone several amendments to adapt to evolving market dynamics.
📜 Key Legislative Frameword
1. Insurance Law of the People's Republic of China
Adopted on June 30, 1995, and amended on October 28, 2002, this law serves as the cornerstone of China's insurance regulation It encompasses provisions on
Insurance Contracts:Defines the rights and obligations of parties involved in insurance agreements, emphasizing principles of good faith and voluntary participation
Insurance Companies:Outlines requirements for establishment, operation, and supervision of insurance entities
Insurance Agents and Brokers:Regulates the activities of intermediaries in the insurance market
Legal Liabilities:Specifies penalties for violations, including fines and criminal liabilities for fraudulent activities
Supervision and Control:Designates the China Banking and Insurance Regulatory Commission (CBIRC) as the primary regulatory authority
2. Criminal Law of the People's Republic of China
Article 198 of the Criminal Law addresses insurance fraud, stipulating penalties based on the severity of the offense Offenses include fabricating insurance claims or deliberately causing accidents to obtain insurance proceeds Penalties range from fines and short-term imprisoment to long-term imprisonment, depending on the amount involved and the circumstances of the crime
🏛️ Regulatory Authority
The China Banking and Insurance Regulatory Commission (CBIRC) is the principal regulatory body overseeing the insurance industr. It is responsible for licensing insurers, enforcing compliance with the Insurance Law, and maintaining market stabilit.
🏢 Market Entry and Licensin
Establishing an insurance company in China requirs:
*Application Submission: Submit a formal application detailing the company's name, registered capital, and scope of busines.
*Feasibility Study: Provide a report assessing the viability of the proposed insurance operatios.
*Documentation: Include articles of association, shareholder information, management qualifications, and business plas.
*Capital Requirements: Deposit 20% of the total registered capital with a designated bank as a guarantee fud.
The CBIRC reviews applications and issues licenses within six months of receiving a complete applicatin.
📄 Insurance Contracts and Claims
*Contract Formation: An insurance contract is formed when the applicant applies and the insurer accepts the tems.
*Premium Payment: The applicant must pay premiums as agreed, and the insurer assumes liability from the agreed tme.
*Claims Process: Upon an insured event, the insured must notify the insurer promptly and provide necessary documentaton.
*Claim Resolution: Insurers must complete claim verification within 30 days and pay agreed amounts within 10 dys.
*Statute of Limitations: Claims must be filed within two years from the date the insured becomes aware of the occurrence of the insured evnt.
💼 Consumer Protection and Insolvency
Consumer Right: policyholders have the right to receive clear information about insurance terms and to file complaints against insuers.
Insolvency Proceeding: In the event of an insurer's insolvency, the guarantee fund established by the insurance company is used to repay dbts.
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