At the beginning of the new year, the review selected china insurance 10 news 2022 and invited experts to make some comments。
01
Support for the third pillar of old age
InsuranceImproved supply capacity of old-age products
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In february 2022, the state council issued the plan for the development of the national system for the development of ageing and the old age services of the 14th five-year plan, 36 of which refer to “insurance” and specify the general requirements, main objectives and tasks of the insurance industry during the 14th five-year plan to assist in the construction of the system。
In order to meet the growing needs of the population for old-age pension protection, in 2022, the supply capacity of old-age products in the insurance sector increased significantly and contributed actively to the construction of the third pillar of pension insurance. At the policy level, in february 2022, the board issued a circular on the expansion of the pilot scope of exclusive commercial old-age insurance, extending the pilot area of exclusive commercial old-age insurance to the entire country, while allowing the participation of pension insurance companies in the pilot; in november, the board issued a circular on matters related to the implementation of individual pension operations by insurance companies, with seven of the exclusive old-age insurance products of six insurance companies becoming the first-line individual pension insurance products; and in december, the board specified that, as of 1 january 2023, four old-age insurance companies had piloted commercial pension operations with pension insurance companies in 10 provinces (municipals)。
In addition, in november 2022, the business insurance research branch of the chinese social security institute was officially established to provide intellectual support for the development of our multi-level social security system。
Director, professor and ph. D. Teacher wang, china insurance institute, beijing business university
Population ageing is a general trend in human social development and addressing the challenges of ageing is a major national strategic issue. Different countries have different characteristics, and the basic characteristics of our population ageing are: the size and rate of old age. In 2021, the number of older persons aged 65 years and over was 20056,000, or 14. 2 per cent of the total population; the second was fast. The proportion of older persons rose from 6. 96 per cent in 2000 to 14. 2 per cent in 2021, only 21 years after; three are relatively behind in commercial old-age insurance, with the third pillar accounting for less than 1 per cent of old-age insurance; and four are under-age and basic old-age security, which is gradually streamlined but more varied. Solving old-age security is therefore an urgent and integrated strategic issue。
The government has repeatedly proposed the establishment of a multi-pillar pension insurance system and three-pillar pension insurance systems for basic pension insurance, enterprise annuities or occupational pensions, individual pensions and commercial pension insurance. In particular, since 2022, the third pillar of old-age insurance has received high priority. The state council issued the “xivv” national plan for the development of ageing services, which refers to the third pillar of old-age insurance, long-term care insurance, etc., and defines the requirements, objectives and tasks of the insurance industry in contributing to the construction of the national pension service system。
In order to further meet the population's needs for old-age pension protection, in 2022 the bank's superintendence of insurance issued a circular on the expansion of the pilot scope of exclusive commercial old-age insurance, a circular on matters related to the implementation of individual pension operations by insurance companies, which was extended nationwide from exclusive commercial old-age insurance to seven pilot units of exclusive old-age insurance products. These policies have greatly enriched the country's supply of commercial old-age insurance products and improved the third pillar of the country's pension insurance system, thereby effectively enriching the social old-age security system, reducing the pressure on basic old-age pensions and raising the population's level of pension insurance。
In fact, the party and the government have been focusing on building a multi-level social security system, including pension insurance. The 20 major reports of the party emphasize once again the importance of “a sound social security system” and the important role of the social security system in the safety of people's lives and the functioning of society, as well as the development of a multilevel social security system。
In november 2022, the china social security institute's business insurance research section was established to provide intellectual support for the construction of our multi-level social security system and theoretical support for an effective framework for the third level of social security, thus contributing to the sound development of our business insurance. The third level of development of our social security system, which we have moved from insurance to insurance, will contribute more effectively to our transition from insurance to insurance。
02
Response to disaster accidents plays a reconstruction role
Improving disaster accident systems in the insurance industry
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In 2022, the insurance industry played an active role in the rehabilitation of major disaster accidents, such as the 3. 21 east flight mu5735 aerial vehicle accident, the sichuan ya'an earthquake, and the scale 6. 8 earthquake。
The professional advantage of insurance was further developed in the modernization of emergency management systems and capacities. In february 2022, the state council issued the plan for the 14th five-year national emergency response system, which proposes to strengthen the positive role of market-based mechanisms such as insurance in risk prevention, compensation for losses and rehabilitation, explore multi-channel risk-sharing mechanisms and vigorously develop disaster insurance; encourage enterprises to take out insurance for safe production responsibilities; and enrich the range of personal safety insurance for emergency relief workers。
The insurance industry's system for responding to major disaster incidents is constantly being updated. In november 2022, the board published the property insurance categorization of accidents, which classifies property insurance accidents as being particularly significant, significant and large according to the nature of the event, the extent of loss and the extent of impact, corresponding to the i, ii and iii levels of response, which are coordinated by the board and its sending agencies, respectively, to initiate, respond to and terminate the response in a timely manner, and to identify the subjects and working measures of the integrated response to disaster incidents at all levels。
Assistant royal army to the dean of the university of foreign economics and trade insurance school
In addition to common and clearly quantified indicators of the level of development of the insurance industry, such as insurance depth and insurance density, one of the important indicators for assessing the extent of the development of the insurance industry in a country or region is its capacity to respond to major disaster accidents. This capacity is reflected both in the share of total losses in insurance awards in major disaster incidents and in the effectiveness and motivation of the insurance industry's emergency response in the aftermath of a major disaster, as well as in the extent to which insurance plays a role in the prevention of major disaster accidents。
The value of insurance never guarantees a small loss, either for the individual family or for the enterprise. It is the value of insurance that risks are passed on to insurance companies in order to cope with unexpected financial shocks to larger losses without affecting the financial stability of households and enterprises. For governments, the compensatory function of insurance is even more negligible. Because whether the insured gives the premium to the insurance company or the insurance company pays the insured person, the loss is not reduced, but an internal transfer of wealth. At the macro level, the value of insurance is more evident in the role that insurance mechanisms can play in disaster prevention and response。
The insurance industry has proven to have a greater role to play in responding to major disaster accidents, but it needs to be implemented as required by the state council's “xiv5” national emergency system plan — strengthening the positive role of market mechanisms such as insurance in risk prevention, compensation for damages and rehabilitation。
The classification of property insurance accidents issued by the superintendence of insurance is an important document for the insurance authorities to continuously improve the mechanisms for the disposal of property insurance accidents and to improve the quality of the disposal of accidents in the financial insurance industry. In particular, a number of innovative and systematic provisions have been made with regard to the classification of property insurance accidents and measures for their disposal, prevention and dissemination, support and security. For example, the classification of property insurance disaster accidents into particularly significant, significant and large three levels, depending on the nature of the event, the extent of the loss and the extent of the impact, corresponding to the initiation of the i, ii and iii levels of response, and the initiation of organizational direction and response measures at the respective levels by the bank's insurance board, the bank's insurance board and the bank's insurance subdirectorate, respectively, have transformed the handling and prevention of single-hazard incidents into a single-insurance operation with specific rules and incentives, and a single-insurance disaster disposal operation into a single coordinated, coordinated and integrated action by local insurance regulators。
It can be said that in 2022, an important step was taken in the construction of a system for the insurance industry to deal with major disaster accidents, and that the value of the insurance industry has been revalued by society with a meaningful code。
03
I'm trying to help you
The insurance industry improves the economic quality of services
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In response to the challenges posed by the spread of the new coronary pneumonia epidemic in the country, in 2022 the insurance industry further expanded its economic “shock-mitigating” and social “stabilizer” functions, enriched its supply of products, improved its coverage, increased its efforts and helped to reduce poverty and boost the real services economy。
In 2022, the insurance industry formally implemented the reimbursability regulation (ii) for insurance companies, with positive results for the service real economy. By the end of the second quarter, an additional $2. 1 billion was provided for risk protection in the field of science and technology; insurance premiums for exclusive commercial old-age insurance products were about $2. 2 billion; minimum capital savings were about $2. 7 billion, which would support insurance companies to provide additional risk security for “three farmers” of about $420 billion; and insurance companies to provide additional risk security for our exports and investments abroad of about $240 billion。
At the policy level, in april 2022, the board issued a circular on financial support for the smooth operation of freight logistics, encouraging insurance companies to develop products such as accident insurance for special job groups such as truck drivers, couriers, etc.; and actively develop financial insurance operations such as cargo insurance and liability insurance for road cargo carriers. In june, a circular was issued on the further development of financial services, such as enterprises in industries affected by the epidemic, requiring insurance agencies to increase the supply of insurance products, increase insurance coverage, provide financial services for foreign trade and encourage late collection of premiums。
The china insurance industry association has twice initiated industry-wide initiatives to ensure that financial relief policies are put on hold。
Zheng wei, director of risk management and insurance, beijing school of economics
The real economy is an important focus of economic development, and the real economy of insurance services is an important component of the economic and social development of insurance services。
The viable path to the real economy of insurance services includes at least the following aspects: first, promoting the production of agro-forestry, fisheries, industrial construction and services through risk security for three main industries on the supply side, and promoting real economic growth. Second, the promotion of consumption, investment and exports through risk guarantees for demand-side residents and enterprises, and the promotion of real economic growth. Thirdly, participation in social management, including through liability insurance, promotes qualitative real economic growth. Fourth, economic growth in the real sector is better served by providing long-term finance and improving the efficiency of financial resource allocation。
In 2022, the insurance industry responded to the obstacles to the functioning of the economy by providing relief and improving the quality of the services sector. First, in response to the specific conditions of the epidemic, greater support has been given to micro-enterprises, freight logistics and enterprise development in difficult industries. Second, support for new forms of urbanization and comprehensive servicesRural revitalizationI don't know. The board issued, inter alia, the circular on strengthening the work of new citizen financial services, the circular on the overall advancement of rural renewal focus in banking insurance services 2022. Thirdly, it supports high-quality road transport and manufacturing development and contributes to the building of powerful nations and nations. The board issued its opinions on banking insurance in support of high quality development of road traffic, circular on further promotion of quality development of the financial services manufacturing sector, which promotes real economic development in many areas。
At the same time, the board also directed the real economy of insurance services from the point of view of solvency, through the newly introduced regulation (ii) of insurance companies on repayability in january 2022. Rule ii allows for the measurement of the minimum risk of insurance for professional science and technology insurance companies at a rate of 90 per cent, the minimum risk of longevity for exclusive commercial old-age insurance products, the minimum risk of insurance for agricultural insurance operations, the minimum risk of insurance for policy long- and medium-term export credit insurance and overseas investment insurance at a rate of 90 per cent, and the minimum risk of insurance for insurance companies at a rate of 90 per cent. These policies can enable the relevant insurance companies to release more capital to support the development of science and technology insurance, pension insurance, agricultural insurance, export credit insurance and overseas investment insurance, as well as to support insurance companies in investing in green bonds, thereby contributing to the ability of the insurance industry to upgrade the service economy。
04
For the first time, the scale of the insurance premiums was over $100 billion
Full advancement of the service rural renewal strategy
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By the end of september 2022, our agricultural insurance premiums had reached $105. 9 billion, an increase of 26. 7 per cent over the same period. For the first time, they had surpassed the $100 billion mark and remained the highest in the world. At present, our agricultural insurance has covered all 826 food-producing counties in the 13 major food-producing provinces of the country, with full cost coverage and income-generating insurance。
To further develop the active role of agricultural insurance in rural revitalization, in april 2022 the bank insurance supervisory board issued a circular on the comprehensive advancement of rural renewal priorities in banking insurance services 2022, which proposes to enhance the role of rural revitalization services。
To further regulate the management of agricultural insurance insurance coverage, in february 2022, the bank issued the agricultural insurance insurance insurance insurance management scheme, which focuses more on services to the “three farmers”, includes new forest insurance as an adaptation, and further clarifies the content and requirements of insurance coverage, taking into account recent developments in agricultural insurance, and increases related provisions such as onlineization, technological empowerment, and information security。
Assistant royal army to the dean of the university of foreign economics and trade insurance school
In recent years, the pace of development of agricultural insurance has been steady, with institutional innovation, industry norms and market development steadily moving forward. In 2022, for the first time, our agricultural insurance premium reached the hundreds of billions mark and continued to be the highest in the world. In the first three quarters, agricultural insurance earned rmb 10. 9 billion, an increase of 26. 7 per cent over the same period, providing guarantees of rmb 4. 28 trillion for 152 million households. The agricultural insurance market has continued to grow in size, the level of security has been increasing, the level of technological sophistication has been deepening, and pilot work on innovation risks has yielded significant results. In particular, the total coverage of 826 major food-producing counties in the 13 major food-producing provinces of the three major food-producing provinces has provided a solid basis for agricultural insurance to guarantee national food security, agro-industry development and increased income for farmers. These achievements, facilitated by consistent policies in the regulatory, agricultural and financial sectors, are also indicative of the fact that in the three years of the new coronary pneumonia epidemic, a group of people have done their job with dedication and commitment。
The construction of the agricultural insurance system is a guarantee for the healthy development of agricultural insurance. In 2022, the bank issued the agricultural insurance insurance insurance and compensation management scheme, which provides for insurance coverage, insurance coverage, insurance coverage and billing from underwriting; reporting, surveying of damages, filing of cases, settlement of awards, award of awards and payment of awards; and co-operation of business management and internal control management, which provides for a full process of insurance coverage in the plantation and farming industries. At the same time, the insurance industry association has issued, in a timely manner, model insurance provisions for the pig breeding industry, model insurance provisions for the pig breeding industry and model provisions for the forest insurance industry. The institution-building of agricultural insurance, which focuses on services to the “three farmers”, promotes the process of “extension, enhancement and labelling” of agricultural insurance by increasing the efficiency of science and technology。
It has been proven that for several years the main drivers of agricultural development in the country have come from three sources: financial subsidies, institutional optimization and scientific and technological empowerment. With a view to further promoting agricultural insurance to better serve the country's “three-farmer” cause, and on the basis of continued increased and extensive central and local financial support for agricultural insurance, the process of legalization of the agricultural insurance market must be continuously promoted, supervision and regulation strengthened and relations between the government and the market streamlined. The involvement of local governments, especially at the district level, in agricultural insurance is strictly regulated, and forced insurance, intervention pricing, retention, and diversion of premium subsidy funds from central and provincial governments are eliminated. At the same time, the development of agricultural insurance is further promoted through institutional innovations and scientific and technological means to enable agricultural insurance in all its aspects。
05
Regulation of information on personal risk products pea. Lou
Effective protection of legitimate rights and interests of financial consumers
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In 2022, the board twice reported on the typical issue of personal risk products in january and november. The design of the personal insurance product raises the issue of unreasonable coverage of insurance coverage, unreasonable calculation of the value of cash, imprescriptible and unreasonable presentation of the product clause, unreasonable determination of the product rate and lack of pricing basis。
In february 2022, the board's personal insurance department issued a “negative list” of personal insurance products (2022 edition), covering four elements: product terms, product liability design, product rate fixing and actuarial assumptions, and product submission management。
In order to effectively protect the legitimate rights and interests of insured persons, insured persons and beneficiaries, in november 2022 the board issued the personal insurance product disclosure management scheme, which identifies the subject of disclosure of the product by insurance companies, and the right use of the product disclosure by insurance salesmen, insurance intermediaries and their practitioners; and defines the disclosure of the product before, during and after sale。
Director, professor and ph. D. Teacher wang, china insurance institute, beijing business university
Disclosure of insurance products is an important aspect of disclosure by insurance companies, and disclosure of personal risk products is an important element of disclosure insurance by insurance companies operating personal risk products. Regulating disclosure of personal risk products not only promotes compliance by insurance companies, stabilizes the personal risk market, but also involves reducing sales misled and insurance disputes, improving consumer transparency and effectively protecting legitimate interests。
Since the resumption of personal insurance operations in 1982, there has been a rapid increase in income from personal insurance premiums, from $16 million in 1980 to $33,633,588 million in 2021. Insurance legislation and regulations are constantly regulated in the course of the development of personal insurance operations. Broadly speaking, the insurance act 1995 was enacted in 2010 and the insurance companies ' information disclosure management scheme was revised in 2018, followed by further elaboration of regulations and normative documents, and the personal insurance product disclosure management scheme is an important regulation regulating the disclosure of personal risk products。
In november 2022, the board issued the personal insurance product disclosure management scheme as a landmark document for the regulation of personal risk product disclosure. The first is to clarify the purpose, scope of disclosure and principles of the document; the second is to identify insurance companies as the subject of product information disclosure, which should be correctly used by insurance salesmen, insurance intermediaries and practitioners, and which should include policyholders, insured persons, beneficiaries and the public at large, and provide channels for disclosure; the third is to identify information disclosure requirements for insurance products before, during and after sale and for specific groups of people; the fourth is to clarify disclosure controls for insurance companies to improve internal product information disclosure management mechanisms; and the fifth is to clarify the legal responsibility of product information disclosure entities. In practice, for the first time, the schedule of premiums for insurance products and the full statement of the cash value of personal insurance products over one year were voluntarily disclosed as product information disclosures, which also contributed to the regulation of insurance operations。
As with the development of insurance operations as a whole, the development of personal insurance operations in our country is in transition to quality development. Further regulate the disclosure of personal risk products, which will enhance overall national insurance awareness by protecting the interests of insured consumers, enhance the credibility and international competitiveness of the insurance industry, promote personal risk practices, achieve high-quality development in a robust manner, effectively perform the third level of personal risk in the social security system and serve socio-economic well。
06
The definition of green insurance is clear
Continued improvement of the green financial policy system
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In 2022, the system of green finance policies in the insurance sector was continuously built, leading insurance institutions to develop green finance and to increase support for green development。
In june, the superintendency of banking insurance issued green finance guidelines, which require banking insurance institutions to strategically advance green finance, increase support for green, low-carbon and circular economies, protect against environmental, social and governance risks, enhance their environmental, social and governance performance and promote a comprehensive green transformation of economic and social development。
In november, the bank insurance green finance guidelines were published by the bank insurance board, which for the first time defined green insurance as a combination of risk security and financial support in the insurance industry in terms of environmental resource protection and social governance, green industry operations and green living consumption。
Wang tsingnan, deputy director, centre for insurance and economic development research, china institute of social sciences
The construction of eco-civilization is an important element of high-quality development, and a green development path is an inevitable option for a new stage of development. Insurance can play an important role in green development as an important method of managing risk for market owners and an important tool for national governance of economic and social societies。
Green development requires the protection of the ecological environment and the realization of the green mountain. In this regard, insurance agencies can analyse and assume environmental risks for their clients, manage risk “reduce” and improve the efficiency of government assistance to vulnerable ecological groups; and in investment activities, they can increase or decrease investments based on project-friendly environments. Green development requires effective carbon savings to address climate change. Insurance can cover risks in the development and use of green technologies and increase investment in sustainable development projects such as clean, low-carbon energy construction, in particular by providing medium- and long-term finance. Following the introduction of the “two carbon” target, insurance institutions will enhance consideration of the “carbon” factor and there will be greater scope for insurance incentives and constraints。
The green finance guidelines for banking insurance, issued in june 2022, are systematic and leading and fully deploy green insurance. First, there are a number of requirements for corporate governance. (b) promote the role of insurance agencies in clarifying the roles of boards or boards of directors, executives, specialized committees, directors of green finance, etc., and promote the operationalization of the green development concept and become a realistic reference point for improved corporate governance in insurance institutions. Second, to integrate green-related risks into a comprehensive risk management framework. Risk alerts for insurance institutions through quantitative or qualitative indicators promote both green development as an endogenous option for insurance institutions, as well as prudential and stable practices. Thirdly, the emphasis on market-based mechanisms has reinforced the principle of disclosure of information and led to several initiatives. The international frontier practice allows insurance agencies to follow the green development path spontaneously, taking into account their endowments, abilities and values. Fourth, from the environmental factor (e), attention is paid to the social factor (s), further extending to the governance factor (g), which incorporates the esg concept and system. While “g” and even “s” go beyond the concept of “green”, the adoption of the esg concept can facilitate international exchanges and cross-border cooperation between insurance agencies and the insurance industry。
The circular on a statistical system for green insurance, issued in november 2022, defines green insurance in the context of green development objectives, defines the scope of green insurance activities, forms the basis for holistic work on green insurance and promotes green ideas to reach insurance practitioners at all levels. Traditionally, in addition to environmental risks, “green” is not an important factor affecting the various types of risk covered by insurance, nor is it important information collected and analysed by global insurance institutions. Therefore, the circular explores a statistical system that allows chinese insurance to base its green practices on detailed data and is an important contribution to global green insurance activities。
07
Implementation of the regulations governing the management of insurance assets
Directing the regulatory operation of insurance asset management companies
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In august 2022, the board issued the regulations for the management of insurance assets management companies, which were formally implemented on 1 september。
A total of seven chapters and 85 of the regulations have been substantially revised in terms of the structure and content of the articles. The main elements include the following: a new chapter on corporate governance, the enhancement of the operational independence of insurance firms, and a comprehensive strengthening of the institutional framework for corporate governance regulation. Second, a dedicated chapter on risk management focuses on strengthening the risk management capacity of insurance companies and on ensuring long-term financial security, such as insurance funds. Third is the requirement to optimize the design of equity structures, to treat the shareholders of domestic and external insurance companies equally, and to remove the foreign equity ceiling. Fourth is the optimization of operating principles and related requirements, the addition of basic principles for the management of funds entrusted to them, the explicit requirement for the establishment of a trusteeship mechanism, the improvement of asset independence and the prohibition of debt set-off statements, and the strict prohibition of access operations. Fifth is the addition of regulatory instruments and regulatory irregularities to further improve the quality of institutional regulation。
Zhu junsheng, research director, china insurance and pension research centre, qinghua university school of finance
With economic development and the accumulation of wealth among the population, our asset management market has grown rapidly, with about 135 trillion yuan in size by the end of 2021. On 1 january 2022, the guidance on the regulation of asset management operations in financial institutions was formally implemented, and the regulatory sector has developed a marketable and specialized competition under uniform regulation and coordinated regulation. In order to facilitate the integration of insurance management into the large-capital market, in 2022 the bank amended the regulation on the management of insurance asset management companies, which provides guidance for the marketization and differential development of insurance asset management companies, helps to channel and promote the normative operation and quality development of insurance asset management companies, better meets the value-added needs of long-term funds, such as insurance funds, and fosters more robust institutional investors for the smooth and healthy functioning of capital markets and the high-quality development of the real economy。
Compared to the original provisions, there are at least six positive changes in the regulation: the first is the extension of the position of the insurance regulatory company from the “trusted management of funds such as insurance” financial institutions to the commissioning of qualified investors, the issuance of insurance management products and other permitted operations, and the incorporation of insurance asset management companies into the large-capital market. The second is a new chapter on corporate governance, which promotes the independence of insurance firms while strengthening the regulatory framework and establishing an independent, large market-oriented governance base. Third, risk management is included as a specific section, with systematic requirements for risk management systems, internal control compliance systems, and audit oversight systems, with emphasis on the ability of insurance companies to exercise control. Fourth, the requirements for the design and institutional set-up of equity structures have been optimized and the principles of openness and marketability have been implemented. Fifth is the optimization of business principles and related requirements by creating a “red and green light” for insurance management on a wider track. Sixth is the addition of regulatory instruments and irregularities, and greater independence implies greater responsibility。
The regulation offers new opportunities for the development of insurance. The size of third-party asset management is often higher in the world's leading insurance institutions, such as the united nations environment programme, which has over 70 per cent. As of the end of 2021, the assets managed by 32 insurance asset management companies in the country amounted to rmb 19,89 trillion and, by source of funds, the management of insurance funds amounted to rmb 17,73 trillion, representing 84 per cent of the total volume of management funds; and the management of off-site funds amounted to rmb 3,38 trillion, or 16 per cent. There is considerable room for improvement in the third-party management of our insurance asset management company compared to mature foreign management agencies. The regulation removes some of the industry barriers and allows insurance regulators to take advantage of their long-term financial advantages, compete in large-scale management markets and seize new opportunities for development; and helps to promote the core competitiveness of insurance asset management firms, third-party management operations and the high-quality development of the insurance industry。
08
Establishment of hierarchical sales rules
The regulation of insurance sales continues
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In september 2022, the board issued risk alert no. 5 of 2022 to alert consumers against misleading insurance sales。
In 2022, work on the regulation of insurance sales behaviour continued. In july, the board consulted publicly on the measures for the management of insurance sales (approval draft), which included pre-insurance, in-sales, post-sales behaviour management, and public education and information security obligations for insurance companies and insurance intermediaries. In november, the chinese insurance industry association issued a plan for building a system of qualification for the sales capacity of insurance sales practitioners, which seeks to set up rules for the authorization of sales at a level corresponding to the qualifications of sales capacity over a period of about three years. Depending on the complexity of the insurance products, the qualifications of the sales capacity are divided into four levels, with the first, second and third levels being only those of the insurance product, and the fourth level being those of the insurance product and related non-insured financial products, with the overall upgrading of the professional qualifications and professional skills of the sales staff。
Wang hong-nan, deputy director, centre for insurance and economic development research, china institute of social sciences
For ordinary goods, sales are a “risk leap” process, while for insurance products, sales are usually the beginning of the service and largely affect the way in which and the effect of the follow-up service. Insurance exists in all areas of social productive life and is exposed to risks of diversification and complex consumers, so the industrial organization of the subject of insurance sales needs to be adapted to this diversity. The rapid economic and social development of the country, with several rounds of changes in the supply of and market demand for the elements of insurance sales, has led to the emergence of new situations and problems as old problems continue to decline. These factors determine that insurance sales are “scientific” and that insurance requires regulation of market behaviour, which is not easy to achieve in a fair, effective and comprehensive manner。
In recent years, consumer protection has become a priority objective of the insurance regulatory sector, while regulating sales has been a priority. The measures for the regulation of insurance marketing practices (approval draft) (hereinafter referred to as the scheme), issued in july 2022, is a more comprehensive and integrated regulation. First, the subject matter of regulation includes insurance companies, several types of insurance intermediaries and various categories of salesperson, so it begins with “acts” and is comprehensive. Second, the pre-sales, in-sales and post-sales practices are regulated by the insurance sales process. The points of concern, before, after and after, vary widely and incorporate the relevant requirements in the “notification” of multiple “options” in existing regulatory regimes. The focus on pre- and post-sales reflects the “finishing” of management responsibilities, the improvement of risk-producing soils and the need to invest in insurance services, especially long-term risk services. Thirdly, the establishment of a system for the classification of insurance products, the classification of sales personnel and the matching of both are specified. Among them, the standard classification of sales staff is concerned with professional knowledge, marketing skills, good faith behaviour, etc., which dilutes the requirements for academic qualifications and practitioners. Institutional synergies are being developed to improve the quality of sales services and consumer satisfaction, in conjunction with an ongoing system of assessment of the risk tolerance of insurance clients and a system of disciplinary sanctions for failures by insurance sales personnel. Fourth, the elements of accountability for violations have been developed to ensure that demands are met。
On the basis of the scheme, the implementation rules for the sub-areas have been introduced. For example, in november 2022, the china insurance industry association issued the plan for building the qualifications and qualifications system for insurance sales practitioners, which aims to establish rules for the authorization of sales that correspond to the qualifications of sales capacity and to promote the professionalization of insurance sales teams. This programme, which incorporates industry-wide ideas, builds broad consensus and is implemented together, is an important manifestation of self-regulation in the insurance sector。
The market response generated by the scheme has been strong and is being widely consulted. It is to be hoped that the implementation of the scheme and its accompanying rules will advance our insurance market to enhance the quality and effectiveness of development on a scale and pace。
09
Strengthening the regulation of related transactions in the use of insurance funds
Continuous regulation of the use of insurance funds
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In january 2022, the bank organized a special inspection of transactions related to the use of insurance funds, the first of its kind since its inception。
In parallel with enhanced inspections, the system has been further strengthened. In january 2022, the superintendence of banking insurance institutions issued the measures for the regulation of related transactions of banking insurance institutions, which regulates the conduct of related transactions of banking insurance institutions and protects against the risk of the transfer of benefits. In june, the superintendence of banking insurance institutions issued a circular on strengthening the regulation of related transactions in the use of the funds of insurance institutions, undermining the primary responsibility of insurance institutions, strengthening supervision and supervision, fully exploiting the role of the industry's self-regulatory organizations, regulating the use of related transactions of insurance funds and preventing investment risks。
Director, department of risk management and insurance, beijing school of economics
In recent years, the bank's superintendence of insurance has found, in its risk disposal of high-risk insurance institutions, that there is a high risk risk associated with the use of insurance funds, that there is a constant retrofitting of inappropriately linked transactions, and that this is an area of heightened risk in the insurance industry。
In order to correct the misappropriation of insurance funds, the transmission of benefits and the transfer of property by major shareholders or related parties in insurance institutions through related transactions, in 2022 the superintendence of banking and supervision of related transactions in the use of insurance funds increased its efforts to regulate the use of insurance funds, a special inspection of related transactions in the use of insurance funds was organized in january and a circular on strengthening the supervision of related transactions in the use of funds by insurance institutions was issued in june (hereinafter referred to as the circular). Among them, the january on-site inspection was the first special inspection dedicated to transactions connected with the use of insurance funds since the establishment of the board, as well as the first large-scale special inspection operation following the reform of the responsibility of the institution's supervisory body。
There are four main categories of institutions that focus on strengthening the regulation of related transactions in the use of the funds of insurance institutions: insurance agencies that have investments in capital-based gold control platforms or covert gold control platforms; insurance agencies that have high leverage, tight financial flows and aggressive expansion of industrial capital investments; insurance agencies that have a high degree of concentration and irregular operation; and insurance agencies that have high-risk bank deposits, high concentration of alternative investments, high value of related transactions, high percentage of related transactions used or unusual disclosure of related transaction information。
The circular requires that the primary responsibility of the insurance institution be upheld and specifies what the insurance institution should and should not do in the field of related transactions in the use of funds. On the one hand, it was emphasized that insurance agencies should clarify the division of responsibilities between the “triple tier” of corporate governance in the management of associated transactions for the use of funds, strengthen the identification and management of related parties, strengthen the management of the decision-making process for related transactions, and issue disclosure notices in accordance with regulatory requirements. On the other hand, it is emphasized that insurance institutions must not exist, for example, by circumventing relevant transaction reviews or regulatory requirements by concealing or concealing related relationships, shareholdings, drawer agreements, etc.; or by breaking regulatory restrictions by borrowing immovable property projects, non-insured subsidiaries or other means, or by stretching the chain of finance, blurring the substance of the business, concealing the final flow of funds, and committing violations of financing and channelling benefits to related parties or parties. These regulatory initiatives are important for channelling regulatory pressure to insurance institutions, sound management of related transactions in the use of funds, and protection against risks in the use of funds。
10
Health sector in the insurance sector
Meeting the health needs of the population
[continues]
In may 2022, the office of the secretary of state issued the “xivv” national health plan, which provides for an increase in the supply of new health insurance products, encourages insurance institutions to undertake management-based medical pilot projects, and provides a platform for high-level public hospitals and their special-needs medical components to interface with insurance agencies。
In 2022, in order to continue to build a healthy china and to meet the growing health needs of the population, there was a marked increase and acceleration in the allocation of health care facilities。
Following the issuance of the new ten articles by the joint prevention and control mechanism of the state council on 7 december 2022, the insurance agencies actively provided services and assistance in the field of health care, based on their resource advantage. On the day after the release of the new ten-year free-of-charge consultation area on the safe and healthy health promotion under the chinese flag, the number of visits to the advisory area increased by 137 per cent from the previous day; the tecon insurance fund, which provided 300 family doctors' teams in 15 community health centres in the western city of beijing and over 40 old-age institutions, donated a total of 400 tablets of blood oxids; and the beijing general health insurance granted new coronal virus safeguards to the insured persons in 2023。
Head of research at the china insurance and pensions research centre, qinghua university school of finance fan
In 2022, the insurance industry increased the distribution of health care, essentially because health insurance and health services have a well-integrated cooperative basis. The sustainable development of health insurance requires greater cooperation between insurance companies and health services such as medical care, medical examinations and nursing. First, insurance institutions have developed stronger links with health services through investment creation, strategic cooperation, etc., which allow for the sharing of medical data, cooperation in the development of health insurance products suited to market needs, and better use of insurance risk protection and risk management functions. Second, the insurance institutions provide clients with services such as health risk assessment, health check-ups, health counselling, health management and the competitive advantage of the service. Thirdly, insurance companies, in cooperation with medical institutions, can effectively perform strategic purchasing functions as payers, strengthen supervision of medical behaviour and control of medical costs, promote norms of medical behaviour, reduce the rate of payment of compensation and improve the quality of medical services. Finally, the combination of health insurance and health services can also facilitate the integration of liability insurance with asset-based investment operations. On the one hand, investment in health services is large and has a long profit cycle, requiring investment in long-term capital. Insurance financing, with its large and long-term characteristics, is highly compatible with the development needs of health services and can be an important source of capital for health services. On the other hand, investment in the health industry by insurance funds can ease the pressure on insurance funds for misalignment, avert cyclical economic risks, weaken the risk-resistant and sustainable development capabilities of insurance companies because of the impact of capital market instability on their investment earnings。
In recent years, health insurance has been integrated with health services, supported by state policy. Increased coverage of the health sector by the insurance industry can facilitate the integration of “health, medicine, risk” and “health risk plus health management”. Indeed, the disease spectrum in china has changed considerably, with chronic diseases becoming one of the most important factors of death, both urban and rural. Unhealthful diets, inadequate physical activity, unhealthy lifestyles such as smoking, and diseases such as hypertension, blood resin abnormalities, diabetes and obesity. This change highlights the need for health management, which in turn requires health insurance to promote a shift from a treatment-centred to a health-centred health-care system through the distribution of health care. On the one hand, health care services, such as health check-ups, health counselling, health promotion and disease prevention, are provided for the health sector and contribute to the improvement of health levels through improved lifestyles. On the other hand, there is slow disease management, access to medical services and rehabilitation care for the already ill, controlling the development of the disease, improving the effectiveness of treatment, reducing the course of the disease, promoting rehabilitation and stabilizing the quality of life。
