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Chinese private capital lured to invest in insurance sector

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BEIJING, June 21 (Xinhua) -- China's insurance regulator on Thursday unveiled guidelines to encourage and support private investment in the state-owned-asset-dominated insurance industry, marking the country's latest move to loosen restrictions on private capital in the financial sector.

The China Insurance Regulatory Commission (CIRC) said in a statement on its website that qualified private investors can invest in insurance companies by means of incorporation, equity transfers and purchases of new shares to diversify the source and equity of insurers.

The CIRC made a specific ruling on how much a qualified private investor could hold for the first time in history, allowing individual private investors to hold stakes of 20 percent or more in a single insurance company.

The regulator said it would support private funds in setting up insurance intermediaries and agencies to provide a platform for reforms in the country's insurance agency system.

The CIRC said it would also encourage private information-technology companies to cooperate with insurance firms and the regulator itself in information-technology development in the sector

Private capital will be guided to cooperate with colleges and universities to train insurance agents, and private investors are encouraged to provide outsourcing services like data maintenance, software development, translation and consulting, according to the guidelines.

The State Council, China's Cabinet, has announced a number of initiatives to bring private capital into sectors such as infrastructure construction, water resources, new energy, oil, telecommunications and mining, as well as public utilities, as part of efforts to spur a slowing economy.

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