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BEIJING, May 7 (Reuters) - The China Insurance Regulatory Commission said on Sunday that regulatory loopholes should be plugged and supervision stepped up to the overcome shortcomings.
A sound regulatory system for companies should be established and supervision strengthened over the shareholder ownership structure and the authenticity of their funds, the commission said.
In recent years, a series of problems has been identified, including lax enforcement of rules and systemic loopholes, it added.
“The insurance regulatory system needs to deeply reflect and needs to thoroughly take stock and sort things out, locate and correct the shortcomings which exist, earnestly perfect the regulatory system and improve its methods,” the regulator said.
The commission will also closely monitor where insurance funds are invested.
The bar for overseas investments by insurance funds will be raised, it added.
Insurers will have to pay more attention to the development of insurance products, and punishments will be stepped up for those who break the rules, the regulator said.
The statement comes amid a widespread regulatory crackdown on what is seen as the excessive use of universal life products by some insurers, and as China’s central leadership moves to curb risk in the financial system.
The regulator vowed last month to improve its conduct and bring the market back to order after its chairman was placed under investigation and removed from his post for “serious disciplinary violations”, a euphemism for corruption. (Reporting by Ben Blanchard and Stella Qiu; Editing by Nick Macfie)