China insurance regulatory Commission to rein in property insurance product

Speculative class of insurance, and like "smog risks", "Moon risks" such wonderful insurance will officially quit the stage of history.

On January 3, the China insurance regulatory Commission issued the guidelines on property insurance product premium (hereinafter referred to as the rating guidelines) and the guidelines on the development of property insurance products (hereinafter referred to as the Guide to product development), from both ends of the product development and ratemaking standard insurance products.

From the aspect of product development, from 2017, the insurance companies would be barred from developing underwriting losses and profit opportunities of speculative risk insurance products, substance-free meaning, hype gimmick products, the concept of "zero premium" "no danger return premiums" return or other improper benefits insurance products. From a premium view, file specifications the ratemaking process, and the specific requirements to the contents and methods of calculating rate.

According to the surging news Combs, 2016, the CIRC said in its official website announced 16 regulatory letters, 8 are concerning the regulation of property insurance products. 6 regulatory functions associated with automobile insurance ratemaking, 1 telephone sales, return and settlement-related, 1 agricultural insurance claim-related.

Speculative risk insurance products to say "no" China Unicom or modified programmes had been finalized

According to this times released of products development guidelines, insurance company shall not development following eight class insurance products: (a) on insurance standard of not has legal Shang admitted of legal interests; (ii) agreed of insurance accident not caused was insurer actual loss of insurance products; (three) bearing insurance of risk is determine of, as risk loss not actual occurred or risk loss determine of insurance produced; (four) bearing insurance both loss may and has profit opportunities of speculation risk of insurance products; (five) no real content meaning, and Hype concept gimmick products; (vi) no actual coverage, only the price (fee), price (free of charge) for the purpose of insurance products; (g) "zero premium" "no danger return premiums" return or other improper benefits insurance products; (VIII) other violations, breach of the principle of insurance and social insurance of public order and good custom products.

Insurance, property insurance product development at the same time, some companies there is quantity over quality, focusing on development of light management problems. Tendency of individual concept of product hype and gimmicks, prejudice the legitimate interests of insurance consumers. A few institutional mechanisms are not perfect, and extensive product management, product control are not in place. This product development guidelines detailed for the first time defined the product development principles and prohibitive provisions, such as negative lists may not develop eight types of insurance products. At the company level, provided the company's product development organizations and institutions. In addition, a few company issues such as system is not perfect, the controls are not in place, the company established to develop guidelines on product development guidance to quit the whole process of product management system.

As early as 2014, China people's property insurance company (hereinafter "PICC") has published a section named "air pollution health insurance" (also known as "smog risks") products, premium ranges from 78 to 154 for a period of one year. According to clause 10-50 of the people in Beijing, if 5 consecutive days 12 Beijing monitoring the AQI is greater than 300, one-time payment "pollution allowances" 200-300 yuan. In addition, due to smog-causing (such as respiratory and cardiovascular disease) in hospital, hospitalization subsidies awarded, 50 Yuan-100 Yuan/day, maximum 1500 Yuan. In September of that year, the China insurance regulatory Commission said "smog risks" have contravened the relevant provisions of the Insurance Act, and contrary to the nature of insurance, no longer is an insurance product, more like gambling. In this regard, the insurance of PICC out administrative punishment and fined it 500,000 yuan, higher than that of the total insurance premiums by nearly 200 times.

In June 2014, the China insurance regulatory Commission had issued on standard insurance product development and sales of property insurance companies issued an emergency notice on the relevant issues. As some of the property insurance company at that time contrary to the principle of insurance, development and sales of insurance products of a gambling nature, the China insurance regulatory Commission issued a notice prohibiting this insurance product, and the product naming and marketing tools are clearly defined.

Regulatory focus on property insurance premium

Property insurance at present pricing problems in the process, the China insurance regulatory Commission was issued on the basis of the guidelines on the development of the rating guide, as lead insurance companies to establish reasonable pricing processes and control mechanisms.

So-called premium rate refers to the ratio of premiums payable and the amount of insurance. In determining a reasonable and fair in product design, adequate rates for protecting insurance consumers ' legitimate rights, maintenance of stable and sustainable development of the industry is important.

This times products development guidelines specific content can is divided into three a aspects: a is on rates of constitute and rates determined of principles, for has normative description; II is specification has rates determined of specific process, including early prepared, and determined process, and monitoring and adjustment; three is on products rates determined of supervision management approach made provides, including on rates fine is report, and rates determined work papers of requirements and the Chase accountability provides, for products rates determined regulatory provides guarantees.

According to the surging news Combs, 2016, the CIRC said in its official website announced 16 regulatory letters, 8 are concerning the regulation of property insurance products. 6 regulatory functions associated with automobile insurance ratemaking, 1 telephone sales, return and settlement-related, 1 agricultural insurance claim-related. In terms of auto insurance rates, receive regulatory functions of insurance companies mostly because a comprehensive car insurance costs compared to submit material in the area of automobile insurance combined ratio is expected in major deviations from supervision to fine insurance companies usually stop and modify the relevant insurance premium rate, conduct a comprehensive self-examination and rectification and other regulatory requirements in a timely manner.

The China insurance regulatory Commission said, the next step would promote the construction of long-term mechanism of rate regulation: a framework for building a premium and process, supervise market premium monitoring and adjustment processes, form a complete loop of internal control mechanisms to ensure that the results of rate of rationality, equity and adequacy, to adjust the rates continue. Second is to actively build a monitoring force, strengthen risk control responsibility, guide the insurance industry associations to strengthen self-discipline self-control, self-discipline, the association management methods such as ex-post checks, continues to urge companies to strengthen management product rating. Three is to strengthen the tracking and summary. Regulators will be tracking the implementation of the rating guide, lessons learned, refined and effective practices into departmental rules.