The China Insurance Regulatory Commission (CIRC) has found 19 insurers guilty of product irregularities in its latest move to reduce risk in the country’s burgeoning financial industry.
The CIRC said that 8,495 insurance products from the 19 firms had flaws such as unclear and incomplete statement of terms, improper classification, and unclear terms regarding the reduction of insurer liability, according to a report by Reuters.
“The problems reflect the lack of responsibility of some companies in product management,” the regulator said in a post on its website. It also detailed the various irregularities and gave instructions on how to correct them.
Recently, the CIRC announced that it would impose restrictions on insurers that have unsatisfactory ratings for asset liability management. It also ordered insurers to ensure the compliance of each investment related to local government debt in order to reduce risk and prevent funds being used for illicit purposes.
An increase in oddball products such as “love insurance” which are more similar to gambling than actual insurance has also attracted the regulator’s ire. It warned the public to avoid patronising such products and threatened to go after firms who refuse to stop selling them.
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