Provisions on the Regulation of Insurance Brokers
Provisions on the Regulation of Insurance Brokers
Provisions on the Regulation of Insurance Brokers
Order of the China Insurance Regulatory Commission [2018] No.3
February 1, 2018
The Provisions on the Regulation of Insurance Brokers, adopted at the sixth chairman office meeting of the China Insurance Regulatory Commission on January 17, 2018, have been released for implementation as of May 1, 2018.
Provisions on the Regulation of Insurance Brokers
Chapter I General Provisions
Article 1 In order to regulate the operations of insurance brokers, protect the lawful rights and interests of the applicant, the insured and the beneficiary, and maintain the market order, the Provisions on the Regulation of Insurance Brokers (the "Provisions") are hereby formulated in accordance with the Insurance Law of the People's Republic of China (the "Insurance Law") and other laws and administrative regulations.
Article 2 For purposes hereof, the term "insurance brokers" refers to institutions, including insurance brokerage companies and their branches, that provide intermediary services for the entry into insurance contracts by and between applicants insurance companies for the interests of the applicants and therefore receive commissions according to the law.
The term "insurance brokerage practitioners" in the Provisions refers to persons who are employed by insurance brokers to draft insurance plans for applicants or the insured, handle the insurance procedures, assist in the claims for compensation, or provide the clients with disaster and loss prevention, risk assessment, risk management consulting services, and engage in reinsurance brokerage and other business.
Article 3 To operate insurance brokerage business within the territory of the People's Republic of China, an insurance brokerage company shall meet the conditions stipulated by the China Insurance Regulatory Commission ("CIRC") and obtain a license to operate insurance brokerage business (the "license").
Article 4 An insurance broker shall comply with laws, administrative regulations and the provisions of the CIRC and follow the principles of voluntariness, honesty and fair competition.
Article 5 As authorized by the Insurance Law and the State Council, the CIRC supervises and administers all insurance brokers.
The CIRC local offices exercise regulatory authority within the scope as authorized by the CIRC.
Chapter II Market Access
Section 1 Business License
Article 6 An insurance broker shall be established in the following forms unless otherwise provided by the CIRC:
1. A limited liability company; and
2. A company limited by shares.
Article 7 To operate insurance brokerage business, an insurance brokerage company shall satisfy the following conditions:
1. Its shareholders meet the requirements hereof, and make capital contribution with their self-owned, true and lawful funds instead of bank loans or non-self-owned funds in various forms;
2. Its registered capital meets the requirements of Article 10 and is under the custody in accordance with the relevant provisions of the CIRC;
3. Its business scope recorded in the business license is in compliance with the relevant provisions of the CIRC;
4. Its articles of association are in conformity with the relevant provisions;
5. Its company name is in conformity with these Provisions;
6. Its senior officers meet the qualification requirements hereof;
7. It has established a governance structure and internal control system as stipulated by the CIRC, and a scientifically and reasonably feasible business mode;
8. It has a fixed domicile in line with its scale of business;
9. It has a business and financial information management system as stipulated by the CIRC; and
10. Other conditions provided for in laws and administrative regulations and by the CIRC.
Article 8 Any entity or individual who is under any of the following circumstances may not be a shareholder of an insurance brokerage company:
1. having been punished or subject to major administrative penalties during the last five years;
2. being investigated by the relevant departments for suspected major offenses;
3. being subject to joint punishments by the relevant state entities and shall be punished in the field of insurance due to serious dishonesty or being involved in other serious dishonesty records within the recent five years;
4. cannot invest in any enterprises in accordance with laws and administrative regulations; or
5. other circumstances where the CIRC deems the entity or individual inappropriate to be a shareholder of an insurance brokerage company in accordance with the principle of prudential supervision.
Article 9 A staff member of an insurance company or a practitioner of a professional insurance intermediary investing in an insurance brokerage company shall provide a written certificate proving the employer's knowledge of that investment; a director, supervisor or senior officer of an insurance company or a professional insurance intermediary investing in an insurance brokerage company shall obtain the consent of the shareholders' meeting or general meeting of shareholders according to the related provisions.
Article 10 The minimum registered capital of an insurance brokerage company that conducts business in regions not limited to the province, autonomous region, municipality directly under the Central Government, or the city specifically designated in the state plan where its business registration is made is CNY50 million.
The minimum registered capital of an insurance brokerage company that conducts business in the province, autonomous region, municipality directly under the Central Government, or city specifically designated in the state plan where its business registration is made is CNY10 million.
The registered capital of an insurance brokerage company must be paid-in money capital.
Article 11 The name of an insurance broker shall include the words "insurance brokerage".
The name of an insurance broker shall not be the same as that of an existing professional insurance intermediary, unless the insurance broker has the same actual controller as that of the professional insurance intermediary.
Article 12 An insurance broker applying for operating insurance brokerage business shall, after obtaining the business license, submit without delay the application materials as required by the CIRC and disclose the relevant information.
The CIRC and its local offices shall grant administrative licenses in accordance with their statutory responsibilities and procedures.
Article 13 After receiving the application for operating insurance brokerage business, the CIRC and its local offices shall understand and examine the operating records of the shareholders of the applicant and the applicant's market development strategy, business development plan, construction of the internal control system, staffing, information system configuration and operation as well as other matters by means of conversation, inquiry, on-site inspection and acceptance and other manners, conduct risk testing and give risk warnings.
Article 14 If the CIRC and its local offices grant a permit to an applicant to operate the insurance brokerage business in accordance with the law, they shall issue licenses to the applicant. An applicant may not carry out the insurance brokerage business until it obtains the license, and it shall register the relevant information in a regulatory information system as prescribed by the CIRC in time.
Where the CIRC and its local offices decide not to grant a permit, they shall make a written decision and state reasons. An applicant shall, within 15 days from the date of receiving the written decision of the CIRC and its local offices, make a written report to the industrial and commercial administrative department where its industrial and commercial registration is made. Where the company continues to exist, it shall not engage in the insurance brokerage business and shall go through the formalities for business registration of changes in matters such as name, business scope and articles of association according to the law, and ensure that there is no such words as "insurance brokerage" in its name.
Article 15 An insurance brokerage company that conducts business in regions not limited to the province, autonomous region, municipality directly under the Central Government, or the city specifically designated in the state plan where its business registration is made may operate insurance brokerage business within the territory of the People's Republic of China.
Where an insurance brokerage company that conducts business in regions not limited to the province, autonomous region, municipality directly under the Central Government, or the city specifically designated in the state plan where its business registration is made sends insurance brokerage practitioners to any places other than the place of incorporation to serve the applicants or the insured that are natural persons, it shall set up local branches. When setting up branches, it shall firstly set up a provincial branch assigned to be responsible for handling applications for administrative licensing, regulatory reports, submission of statements and other related matters and managing other branches.
An insurance brokerage company's branches include branch offices and business departments.
Article 16 To operate insurance brokerage business by newly established branches, an insurance brokerage company shall satisfy the following conditions:
1. The insurance brokerage company and its branches have not been punished or subject to major administrative penalties in the recent one year;
2. The insurance brokerage company and its branches have not been investigated by the relevant departments for suspected major offenses;
3. The insurance brokerage company and its branches have not triggered any group petition of more than 30 people or abnormally concentrated surrender cases of more than 100 persons in the recent one year;
4. The branches established in the recent two years do not exit the market within one year of operation;
5. The insurance brokerage company has a sound branch management system;
6. The newly established branches have satisfactory business premises, business financial information systems and other facilities that match the business operations;
7. The principals of the newly established branches shall meet the job qualifications hereof; and
8. Other conditions provided for by the CIRC.
In the event that any insurance brokerage company is subject to joint punishments by the relevant state entities and shall be punished in the field of insurance due to serious dishonesty, or is involved in other serious dishonesty records within the recent five years, it may not establish new branches to operate insurance brokerage business.
Article 17 Within 15 days from the date of registration as stated in the business license, the branches of an insurance brokerage company shall report in writing to the CIRC local offices, register the relevant information in the regulatory information system regulated by the CIRC, publicly disclose it in accordance with the provisions, and submit the application materials or reporting materials with respect to the approval of the qualifications of the principals.
Article 18 Where an insurance broker falls under any of the following circumstances, it shall, within five days from the occurrence of that circumstance, make public disclosure in accordance with the provisions via the regulatory information system stipulated by the CIRC:
1.
......
Order of the China Insurance Regulatory Commission [2018] No.3
February 1, 2018
The Provisions on the Regulation of Insurance Brokers, adopted at the sixth chairman office meeting of the China Insurance Regulatory Commission on January 17, 2018, have been released for implementation as of May 1, 2018.
Provisions on the Regulation of Insurance Brokers
Chapter I General Provisions
Article 1 In order to regulate the operations of insurance brokers, protect the lawful rights and interests of the applicant, the insured and the beneficiary, and maintain the market order, the Provisions on the Regulation of Insurance Brokers (the "Provisions") are hereby formulated in accordance with the Insurance Law of the People's Republic of China (the "Insurance Law") and other laws and administrative regulations.
Article 2 For purposes hereof, the term "insurance brokers" refers to institutions, including insurance brokerage companies and their branches, that provide intermediary services for the entry into insurance contracts by and between applicants insurance companies for the interests of the applicants and therefore receive commissions according to the law.
The term "insurance brokerage practitioners" in the Provisions refers to persons who are employed by insurance brokers to draft insurance plans for applicants or the insured, handle the insurance procedures, assist in the claims for compensation, or provide the clients with disaster and loss prevention, risk assessment, risk management consulting services, and engage in reinsurance brokerage and other business.
Article 3 To operate insurance brokerage business within the territory of the People's Republic of China, an insurance brokerage company shall meet the conditions stipulated by the China Insurance Regulatory Commission ("CIRC") and obtain a license to operate insurance brokerage business (the "license").
Article 4 An insurance broker shall comply with laws, administrative regulations and the provisions of the CIRC and follow the principles of voluntariness, honesty and fair competition.
Article 5 As authorized by the Insurance Law and the State Council, the CIRC supervises and administers all insurance brokers.
The CIRC local offices exercise regulatory authority within the scope as authorized by the CIRC.
Chapter II Market Access
Section 1 Business License
Article 6 An insurance broker shall be established in the following forms unless otherwise provided by the CIRC:
1. A limited liability company; and
2. A company limited by shares.
Article 7 To operate insurance brokerage business, an insurance brokerage company shall satisfy the following conditions:
1. Its shareholders meet the requirements hereof, and make capital contribution with their self-owned, true and lawful funds instead of bank loans or non-self-owned funds in various forms;
2. Its registered capital meets the requirements of Article 10 and is under the custody in accordance with the relevant provisions of the CIRC;
3. Its business scope recorded in the business license is in compliance with the relevant provisions of the CIRC;
4. Its articles of association are in conformity with the relevant provisions;
5. Its company name is in conformity with these Provisions;
6. Its senior officers meet the qualification requirements hereof;
7. It has established a governance structure and internal control system as stipulated by the CIRC, and a scientifically and reasonably feasible business mode;
8. It has a fixed domicile in line with its scale of business;
9. It has a business and financial information management system as stipulated by the CIRC; and
10. Other conditions provided for in laws and administrative regulations and by the CIRC.
Article 8 Any entity or individual who is under any of the following circumstances may not be a shareholder of an insurance brokerage company:
1. having been punished or subject to major administrative penalties during the last five years;
2. being investigated by the relevant departments for suspected major offenses;
3. being subject to joint punishments by the relevant state entities and shall be punished in the field of insurance due to serious dishonesty or being involved in other serious dishonesty records within the recent five years;
4. cannot invest in any enterprises in accordance with laws and administrative regulations; or
5. other circumstances where the CIRC deems the entity or individual inappropriate to be a shareholder of an insurance brokerage company in accordance with the principle of prudential supervision.
Article 9 A staff member of an insurance company or a practitioner of a professional insurance intermediary investing in an insurance brokerage company shall provide a written certificate proving the employer's knowledge of that investment; a director, supervisor or senior officer of an insurance company or a professional insurance intermediary investing in an insurance brokerage company shall obtain the consent of the shareholders' meeting or general meeting of shareholders according to the related provisions.
Article 10 The minimum registered capital of an insurance brokerage company that conducts business in regions not limited to the province, autonomous region, municipality directly under the Central Government, or the city specifically designated in the state plan where its business registration is made is CNY50 million.
The minimum registered capital of an insurance brokerage company that conducts business in the province, autonomous region, municipality directly under the Central Government, or city specifically designated in the state plan where its business registration is made is CNY10 million.
The registered capital of an insurance brokerage company must be paid-in money capital.
Article 11 The name of an insurance broker shall include the words "insurance brokerage".
The name of an insurance broker shall not be the same as that of an existing professional insurance intermediary, unless the insurance broker has the same actual controller as that of the professional insurance intermediary.
Article 12 An insurance broker applying for operating insurance brokerage business shall, after obtaining the business license, submit without delay the application materials as required by the CIRC and disclose the relevant information.
The CIRC and its local offices shall grant administrative licenses in accordance with their statutory responsibilities and procedures.
Article 13 After receiving the application for operating insurance brokerage business, the CIRC and its local offices shall understand and examine the operating records of the shareholders of the applicant and the applicant's market development strategy, business development plan, construction of the internal control system, staffing, information system configuration and operation as well as other matters by means of conversation, inquiry, on-site inspection and acceptance and other manners, conduct risk testing and give risk warnings.
Article 14 If the CIRC and its local offices grant a permit to an applicant to operate the insurance brokerage business in accordance with the law, they shall issue licenses to the applicant. An applicant may not carry out the insurance brokerage business until it obtains the license, and it shall register the relevant information in a regulatory information system as prescribed by the CIRC in time.
Where the CIRC and its local offices decide not to grant a permit, they shall make a written decision and state reasons. An applicant shall, within 15 days from the date of receiving the written decision of the CIRC and its local offices, make a written report to the industrial and commercial administrative department where its industrial and commercial registration is made. Where the company continues to exist, it shall not engage in the insurance brokerage business and shall go through the formalities for business registration of changes in matters such as name, business scope and articles of association according to the law, and ensure that there is no such words as "insurance brokerage" in its name.
Article 15 An insurance brokerage company that conducts business in regions not limited to the province, autonomous region, municipality directly under the Central Government, or the city specifically designated in the state plan where its business registration is made may operate insurance brokerage business within the territory of the People's Republic of China.
Where an insurance brokerage company that conducts business in regions not limited to the province, autonomous region, municipality directly under the Central Government, or the city specifically designated in the state plan where its business registration is made sends insurance brokerage practitioners to any places other than the place of incorporation to serve the applicants or the insured that are natural persons, it shall set up local branches. When setting up branches, it shall firstly set up a provincial branch assigned to be responsible for handling applications for administrative licensing, regulatory reports, submission of statements and other related matters and managing other branches.
An insurance brokerage company's branches include branch offices and business departments.
Article 16 To operate insurance brokerage business by newly established branches, an insurance brokerage company shall satisfy the following conditions:
1. The insurance brokerage company and its branches have not been punished or subject to major administrative penalties in the recent one year;
2. The insurance brokerage company and its branches have not been investigated by the relevant departments for suspected major offenses;
3. The insurance brokerage company and its branches have not triggered any group petition of more than 30 people or abnormally concentrated surrender cases of more than 100 persons in the recent one year;
4. The branches established in the recent two years do not exit the market within one year of operation;
5. The insurance brokerage company has a sound branch management system;
6. The newly established branches have satisfactory business premises, business financial information systems and other facilities that match the business operations;
7. The principals of the newly established branches shall meet the job qualifications hereof; and
8. Other conditions provided for by the CIRC.
In the event that any insurance brokerage company is subject to joint punishments by the relevant state entities and shall be punished in the field of insurance due to serious dishonesty, or is involved in other serious dishonesty records within the recent five years, it may not establish new branches to operate insurance brokerage business.
Article 17 Within 15 days from the date of registration as stated in the business license, the branches of an insurance brokerage company shall report in writing to the CIRC local offices, register the relevant information in the regulatory information system regulated by the CIRC, publicly disclose it in accordance with the provisions, and submit the application materials or reporting materials with respect to the approval of the qualifications of the principals.
Article 18 Where an insurance broker falls under any of the following circumstances, it shall, within five days from the occurrence of that circumstance, make public disclosure in accordance with the provisions via the regulatory information system stipulated by the CIRC:
1.
......