Circular of China Insurance Regulatory Commission on Strengthening the Administration of the Banks’ Agency Service for Personal Insurance
(No.25  of China Insurance Regulatory Commission)
The insurance regulatory offices, the branches, business departments, regulatory offices of branches, and the central sub-branches in provincial capitals (capitals of autonomous regions) of the People’s Bank of China, the insurance companies, the commercial banks, and the postal savings & remittance bureaus:
In the recent two years, the insurance companies have enhanced their cooperation with the commercial banks (including postal savings & remittance departments, and cooperative financial institutions, hereinafter the same), the service of banks’ selling of personal insurance products as an agent (hereinafter referred to as “banks’ agency service for personal insurance) has developed rapidly. However, there exist notable misleading problems in the process of banks’ agency service for personal insurance, and if such problems are not solved in good time, the legitimate rights and interests of the consumers will be impaired, the normal development of the banks’ agency service for personal insurance will be seriously affected, the credit of banks and insurance companies will be endangered, and financial risks will result. In order to promote the long-term healthy development of the banks’ agency service for personal insurance, we decide upon deliberation to strengthen the administration of the banks’ agency service for personal insurance. The relevant requirements are hereby notified as follows:
1. The insurance companies and commercial banks shall be fully aware of the necessity and significance of strengthening the administration of the banks’ agency service for personal insurance, and shall establish and perfect, and strictly implement the internal control systems corresponding to the banks’ agency service for personal insurance.
2. The insurance companies shall strengthen information communication and cooperation with commercial banks in the agency service, and shall formulate and implement the corresponding systems of business and financial management, client visits, and after-sale services, etc.
3. The insurance companies and commercial banks shall earnestly strengthen the administration of publicity and information disclosure of the banks’ agency service for personal insurance. The materials of publicity and information disclosure of the banks’ agency service for personal insurance (hereinafter referred to as publicity materials) shall be managed in a unified way by the head offices of the insurance companies pursuant to the relevant provisions of China Insurance Regulatory Commission (CIRC), and the forms and contents of those materials may not violate the relevant provisions of CIRC. The head offices and the branches and sub-branches of commercial banks engaging in banks’ agency service for personal insurance shall set up (or assign) departments or special personnel to administer such service. No insurance company, commercial bank branch or sub-branch, or the staff members thereof, may print any publicity materials or alter the contents thereof without authorization.
4.The head offices of the insurance companies shall be responsible for guaranteeing the rule-compliance, objectiveness, and authenticity of the publicity materials. If an insurance regulatory department finds out any rule-breaking publicity materials through inspection, that department shall require the insurance company to make a correction on the newspaper, shall not approve the sale of any new bank agency personal insurance product for a period, and shall investigate the liabilities of the relevant senior managerial personnel.
5. The insurance companies and commercial banks shall, in the sale, publicize the bank agency personal insurance products objectively and justly. The publicity contents shall meet the following requirements:
1)The insurance products shall not be introduced as savings products. The concepts of “principal”, and “deposit” may not be arbitrarily applied, the benefits of insurance products shall not be publicized as analogy of the proceeds of bank savings or of national debts in a one-sided way, and the products of the company may not be compared in a one-sided way with the relevant products of other companies. The insurance products shall be publicized in an all-around way in the publicity, especially the guarantee functions, the basis for insurance benefits. The risks and expenses shall be pointed out.
2)Insurance companies shall be the business subjects explaining the insurance products to the clients. The words of “jointly promoted by the bank and insurance company”, “promoted by the bank”, or “new bank financing service”, or other similar words, and the symbol or pattern of the bank may not appear in the publicity contents.
3)Important matters shall be faithfully informed to the clients pursuant to the insurance clauses, and the benefits of the insurance contract may not be exaggerated or exaggerated in a disguised form. The fees for cancellation of insurance, the cash value of insurance policy, and the cooling period, etc., shall be expressly informed to the clients. The insurance companies and commercial banks may not, when explaining to the policy holders, promise any unsure proceeds or make any misleading demonstration, neither may they give any falsified, concealing statements, or statements leading to unfair competition.
6.The insurance companies and commercial banks shall strengthen the training of the sales agents, and shall give training especially on laws and regulations, professional ethics, and business knowledge.
7.Insurance companies shall indicate on an eye-catching position on the insurance policy the policy holder’s statements: “I’ve carefully read and understood the clauses of this insurance policy”, and the commercial banks shall, when selling personal insurance products as an agent, have the policy holders to carefully read the full text of the insurance clauses and the product specification, and have the policy holder to sign on the statements for confirmation.
8.The insurance companies shall sort out in a unified way the existing publicity materials of banks’ agency service for personal insurance, and stop the use of and destroy those not meeting the requirements immediately.
9.The insurance regulatory offices and the branches and sub-branches of the People’s Bank of China shall strengthen the supervision and administration of the banks’ agency service for personal insurance, and shall punish according to law the institutions and personnel that violate the aforesaid provisions.
10.The insurance regulatory offices and the branches and sub-branches of the People’s Bank of China shall transmit this Circular to the insurance companies and commercial banks under their respective jurisdictions, and shall establish the cooperative regulation mechanism of banks’ agency service for personal insurance. The insurance companies and commercial banks shall actively assist in the regulation work of the insurance regulatory offices and the branches and sub-branches of the People’s Bank of China.
April 16, 2003