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China lifts cap on life insurance interest rate

Source:   Time:

BEIJING, Aug. 6 (Xinhuanet) -- The 2.5 percent pre-determined interest rates attached to life insurance products here in China have been scrapped.

The move is the latest effort by central government to liberalize the country's interest rates.

The People's Bank of China has already loosened its grip on bank lending rates.

Under the new regulations, insurance companies can set their own rates to a maximum of 3.5-percent.

The rigid 2.5 percent cap left much of the insurance products on offer here in China much the same.

To prevent a policy-triggered price war in the insurance business, the China Insurance Regulatory Commission has also rolled out accompanying measures.

They include policies to boost old-age pension business and moves to support risk prevention.

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