SHANGHAI (Reuters) - China’s insurance regulator launched new rules on Wednesday to tighten insurers’ compliance management systems, it said in a notice on its official website.
The move is the latest in a barrage of measures introduced in the last month by the China Insurance Regulatory Commission (CIRC), which has been taking steps against overbearing shareholders and risky acquisitions in an attempt to clean up the industry.
The rules cover insurance firms and insurance asset management companies and must be implemented by July 1 this year.
The holding company of an insurance conglomerate must set up a compliance management system to oversee the entire group, according to the new rules.
The rules also set out who in a company is responsible for which elements of compliance, for example, the board of directors are ultimately responsible for compliance management while the general manager is responsible for reviewing policy.
An insurance company shall ensure the independence of the compliance department and if the firm dismisses the person in charge of compliance it has to report to the CIRC and provide a reason within 10 days, according to the rules.
Reporting by Engen Tham in Shanghai and Beijing monitoring desk; Editing by Kim Coghill