China Banking and Insurance Regulatory Commission tightens supervision on the access of insurance company branches
The establishment of a branch must have a risk rating of B or above for two consecutive quarters
□ Our reporter Zhou Fenmian
In order to guide insurance companies to establish branches in a reasonable and orderly manner, and to improve the quality and effectiveness of supervision, the China Banking and Insurance Regulatory Commission recently issued a new version of the "Administrative Measures for the Access to Branches of Insurance Companies" (hereinafter referred to as the "Measures") to address the establishment, reconstruction, and restructuring of branches of insurance companies. The procedures for changing business premises and cancellation were standardized.
Experts believe that the new "Measures" generally reflect the trend of stricter access supervision of insurance companies and their branches, and many new requirements and conditions have been added.
New branch cancellation regulations
The "Measures" has six chapters and 46 articles, which are general rules, branch establishment, branch reconstruction, change of business premises, branch cancellation, and supplementary rules.
Liu Xiaoyu, a senior partner of Beijing Bank of China Law Firm, said that the original method only had 35, but 11 new ones have been added.
The new "Measures" unify and integrate the relevant regulatory regulations issued in recent years, and at the same time supplement and improve the existing systems to improve the standardization and systemicity of the approval of the establishment of branches.
Compared with the old method, the first is the change in the legislative basis. In addition to the Insurance Law and the "Regulations on the Management of Insurance Companies," the upper-level legal basis of the Administrative Licensing Law has also been added.
Secondly, it is reflected in the chapters. The new "Measures" added chapters 4 and 5, and added specific regulations on the change of business premises and cancellation of insurance branches.
At the same time, new anti-money laundering and anti-terrorist financing regulations have been added.
A professor from the School of Economics and Law of Northwest University of Political Science and Law strongly stated that although the "Measures" does not specify the number of branches established by insurance companies, with the changes in economic development such as the construction of new development parks and new towns, insurance companies have been changed, rebuilt, and cancelled. It may happen often.
Insurance companies have the driving force to expand their business scale. In order to regulate their development, the China Banking and Insurance Regulatory Commission has strengthened supervision over the branches established by its expansion sphere of influence, which is also in line with the requirements of the times.
According to the "Measures", the branch of an insurance company only changes its business premises within the business area determined at the time of application for establishment, and cannot change across business areas.
At the same time, it shall obtain the approval of the higher-level management agency after meeting the opening standards, or submit the application materials and issue a letter of commitment to meet the opening standards.
Even in the same place, only the increase or decrease in the area of the business premises should be reported to the local office of the China Banking and Insurance Regulatory Commission and related materials should be submitted.
Strongly speaking, business premises and branch offices are places where people directly deal with it. Whether it is changing business premises or dismantling an organization, it should be publicly announced.
The "Measures" stipulate that the branch of an insurance company shall submit an application for cancellation due to serious lack of service capabilities, major hidden risks, or due to strategic adjustments.
According to the "Measures", the dissolution of a branch shall be announced and the relevant insured, insured or beneficiary shall be notified, and proper arrangements shall be made for the payment of insurance premiums and the receipt of insurance money.
Comprehensive risk rating should be above category B
According to Liu Xiaoyu, in terms of market access, the new "Measures" reflect the trend of tightening supervision.
The first is new requirements for the solvency of insurance companies.
Establish provincial branches and branches other than provincial branches. In terms of access conditions, two specific ratio requirements have been added for solvency adequacy ratio and core solvency adequacy ratio. Provincial branch companies have been established for two consecutive quarters before the application. The comprehensive solvency adequacy ratio is not less than 150%, and the core solvency adequacy ratio is not less than 75%; new requirements for the evaluation results of corporate governance have been added. On the basis of "good corporate governance and sound internal control", The requirement that "the result of the previous year's corporate governance assessment was C-level or above" was added.
It is also required that the comprehensive risk rating of the insurance company for two consecutive quarters before submitting the application should be above Category B.
The reporter learned that at the end of the fourth quarter of 2020, the average comprehensive solvency adequacy ratio of the 178 insurance companies included in the meeting was 246.3%, and the average core solvency adequacy ratio was 234.3%.
The average comprehensive solvency adequacy ratios of life insurance companies, property insurance companies, and reinsurance companies were 239.6%, 277.9%, and 319.3%, respectively.
The comprehensive risk rating of 100 insurance companies was rated A, 71 were rated B, 3 were rated C, and 3 insurance companies were rated D.
At the beginning of this year, the China Banking and Insurance Regulatory Commission made an assessment of the corporate governance supervision of 10 insurance groups at this level in 2020. Six of them were rated as B-level, namely the People's Insurance Company of China, China Reinsurance, China Taiping Insurance, China Pacific Insurance, and China Ping An Insurance. , Taikang Insurance.
In comparison, prohibitive and rigid conditions are more deterrent for insurance companies to establish branches.
The "Measures" stipulate that insurance companies may not apply for the establishment of branches in five situations: the applicant has been subject to major administrative penalties by the financial regulatory agency within the last two years; the applicant or the staff of the same level of agency who intends to establish the same level of agency are suspected of major violations and crimes. Causes adverse social impact, or is under investigation by supervisory departments or judicial organs; fined and confiscated more than 300,000 yuan in the last year, restricted the scope of business, ordered to stop accepting new business, revoked business license, or its staff are revoked , Industry prohibition and other insurance administrative penalties, etc.
In recent years, penalized insurance companies have always existed.
According to Liu Xiaoyu, in recent years, the Banking and Insurance Regulatory System has continuously increased the supervision of insurance institutions in violation of laws, regulations and chaos. The establishment of branches upon approval is subject to administrative penalties, and fines, warnings, etc., are imposed on violating units and the main persons in charge.
Improve the requirements for the establishment of reconstruction materials
Strongly speaking, the new "Measures" have many highlights. Among them, the procedures for the establishment and reconstruction of branches of insurance companies are standardized, and the administrative licensing procedures and material requirements are further clarified.
In Qianli's view, in order to expand the scale of operations, insurance companies will set up corresponding institutions.
In some countries, the implementation of the parent-subsidiary system means the establishment of many subsidiaries, even extending their tentacles abroad; the establishment of a head-office system in my country, including branches at the provincial level, prefecture-level central branch companies, county-level branch companies and The sales department and marketing service department, except for the head office, do not have legal personality, which is convenient for supervision.
Because of the public nature of insurance companies, the establishment of insurance company branches is the same as the establishment of insurance companies, and licensing management is implemented.
An insurance company needs many conditions to set up a branch.
According to the "Measures", if the registered capital of an insurance company is 200 million yuan, for each application for the establishment of a provincial branch outside its domicile, the registered capital shall be increased by no less than 20 million yuan; the registered capital shall be more than 500 million yuan. , Can no longer increase.
The establishment of provincial branches and other branches has different requirements in terms of comprehensive solvency adequacy ratio.
According to the "Regulations," the requirements for applying for the establishment of branches other than provincial branches include: the previous year and two consecutive quarters before the submission of the application, the comprehensive solvency adequacy ratio shall be reduced by not less than 150% from the provincial branch. The core solvency adequacy ratio is not less than 120%, and the core solvency adequacy ratio is not less than 75%; the comprehensive risk rating is the same as the previous year’s corporate governance level, consistent with the provincial branch, and they are B and C or above respectively.
Strongly speaking, for the rebuilding of branches, it may be rebuilt to a higher level or to a lower level.
The new "Measures" further clarify the administrative licensing procedures and material requirements.
If an application for reconstruction is required, a reconstruction report must be submitted.
The report includes: the necessity and rationality of the reconstruction, the status of the reconstruction, the impact of the reconstruction on the insurance business and the policyholder, the insured or the beneficiaries and the treatment plan, the three-year business development plan and market analysis of the reconstruction organization, and the reconstruction organization and company The description of the risk management status and the internal control status is very specific, so as to ensure the safe operation of the reconstructed branch to the greatest extent, and to better serve the public.