China Issues New Rules On Investments By Insurers

The China Insurance Regulatory Commission (CIRC) recently released a set of "Interim Measures on the Utilisation of Insurance Funds" (Measures), setting out modified rules on permitted investments by insurance companies in China, effective from 31 August 2010.

In particular, these Measures specify, for the first time, the ratio of insurance funds that may be invested into real estate, shares of unlisted companies and unsecured bonds and debt instruments.

Following the release of these Measures, CIRC also released a "Notice on the Modification of Insurance Fund Investment Policies" (Notice 66) on 11 August, providing further details on insurers' permitted investment channels and ratios.