State Council, Several Opinions Concerning the Reform and Development of the Insurance Industry

Issued: June 15 2006

Main contents: These Opinions seek to:
- actively develop individual and group old-age pension insurance businesses;
- encourage and support enterprises with potential to establish multi-layered old-age pension schemes through commercial insurance;
- strongly promote the development of health insurance, and support relevant insurance institutions to invest in medical institutions (Article 4);
- carry out pilot projects for mandatory liability insurance in industries such as coal mining, and, after gaining experience, gradually promote such projects in areas such as high-risk industries, places of public gathering, and domestic and overseas travel;
- improve the deposit system for work safety risk in high-risk industries, and seek to standardize administration and operation through specialized insurance companies (Article 5);
- develop high-technology insurance such as aviation and aerospace;
- steadily develop consumption credit and guarantee insurance such as housing insurance and motor vehicle insurance;
- encourage the development of specialized insurance companies engaging in commercial old-age pension insurance, health insurance and liability insurance, etc. (Article 6);
- allow qualified insurance asset management companies to gradually expand the scope of asset management;
- explore the establishment of an independent insurance funds custody mechanism;
- provided that risks are under control, encourage the direct and indirect investment of insurance funds in capital markets, gradually increase the investment proportion, steadily expand the scale and variety of asset securitization products invested in by insurance funds, develop pilot investment in immovable properties and venture investment enterprises by insurance funds;
- support equity participation in commercial banks and overseas investment by insurance funds (Article 7);
- conduct research on, and gradually implement, consolidated financial statements for insurance holding (group) companies (Article 9); and
- establish a natural disasters or major catastrophes insurance system supported by state finance (Article 10).