Rules on Administration of Insurance Agency Institutions
Contents
Chapter 1 General Provisions
Chapter 2 Administration of the Organization
Section 1 Establishment
Section 2 Alteration and Termination
Chapter 3 Qualification Administration
Section 1 Administration of Insurance Agency Practitioner Qualification and Practice Certificates
Section 2 Qualification Administration of Senior Management Personnel
Chapter 4 Insurance Agency Relation Management
Chapter 5 Operating Rules
Chapter 6 Supervision and Administration
Chapter 7 Legal Liability
Chapter 8 Supplementary Provisions
Chapter 1 General Provisions
Article 1
For the purposes of regulating the business behaviors of insurance agency institutions and their branches, maintaining fair competition and market order, and promoting the healthy development of insurance industry, these Rules are formulated in accordance with the Insurance Law of the People's Republic of China (hereinafter referred to as the “Insurance Law”) and other relevant laws and administrative regulations.
Article 2
The establishment of insurance agency institutions and their branches within the territory of the People’s Republic of China shall be subject to approval of the China Insurance Regulatory Commission (hereinafter referred to as the "CIRC").
Without approval from the CIRC, no unit or individual shall conduct or conduct in disguised form insurance agency business within the territory of the People’s Republic of China.
Article 3
The CIRC performs the responsibilities of supervising and regulating insurance agency institutions and their branches according to the Insurance Law and the authorization of the State Council.
Local offices of the CIRC exercise their powers and functions within the scope of authorization of the CIRC.
Article 4
“Insurance agency institution” in these Rules refers to an entity that fulfills the qualification requirements specified by the CIRC, has obtained the license for conducting insurance agency business (hereinafter referred to as the "License") with approval of the CIRC, engages in insurance business by and within the authorization of and collect commissions from insurance companies.
“Branches of an insurance agency institution” in these Rules refer to the branch companies and sales offices established by an insurance agency that operate insurance agency business within the scope authorized thereby.
Article 5
All insurance agencies and their branches shall abide by laws, administrative regulations and relevant stipulations of the CIRC and observe the principles of volition, honesty, credibility and fair competition.
Article 6
All insurance agency institutions and their branches shall submit relevant materials and report authentic information to the CIRC according to these Rules and be responsible for the authenticity of the substantial contents of the materials submitted.
Chapter 2 Administration of the Organization
Section 1 Establishment
Article 7
An insurance agency institution may take one of the following organizational forms:
1. Partnership;
2. Limited liability company;
3. Joint stock limited company.
Article 8
The following qualification requirements shall be fulfilled in order to establish an insurance agency institution,:
1. Registered capital or capital contribution reaches the minimum amount specified herein;
2. The articles of association or partnership agreement complies with the stipulations of laws;
3. Senior management personnel fulfill the qualification requirements specified herein;
4. The number of employees holding the Qualification Certificate of Insurance Agency Practitioners (hereinafter referred to as the "Qualification Certificate") exceeds 2 and is not less than half of the total employees;
5. Sound and complete organizational structure and management system are in place;
6. Fixed domicile or business premises that match its business scale;
7. Computer software and hardware facilities that match the business operation;
8. At least one insurance company’s letter of intent for agency authorization.
Article 9
Where an insurance agency institution is established in the form of partnership or limited liability company, its registered capital or capital contribution shall not be less than RMB 500,000. Where it is established in the form of joint stock limited company, its registered capital shall not be less than RMB 10,000,000.
Article 10
Any entity or individual that is forbidden by laws or administrative regulations to invest in enterprises shall not become the promoter, shareholder or partner of an insurance agency institution.
Where an employee of an insurance company invests in an insurance agency institution, he shall inform the insurance company he works for of his investment.
Article 11
The name of an insurance agency institution and its branches shall contain the phrase "insurance agency" and shall not be the same with that of the existing insurance intermediaries.
Article 12
To apply for establishment of an insurance agency, all shareholders, promoters or partners shall designate a representative or jointly authorize an agent to handle application matters with the CIRC.
Article 13
For the application for establishment of an insurance agency institution, the following materials shall be submitted in duplicate to the CIRC:
1. “Application Form for Establishment of Insurance Agency Institution” signed by all shareholders, all promoters or partners;
2. “A Power of Attorney Regarding Application for Establishment of Insurance Agency Institution”;
3. Articles of association or partnership agreement;
4. Photocopies of identity certificates and resumes of natural-person shareholders, promoters or partners, photocopies of business licenses of non-natural-person shareholders orpromoters and their financial statements of the last year and such statements shall be stamped with the seal of finance;
5. Capital verification certificate issued by a capital verification organization with statutory qualification and the photocopy of the original bank receipt voucher evidencing payment of the capital;
6. Feasibility report, containing an analysis of the market and a business development plan for the next 3 years;
7. Photocopy of notice of preliminary approval of enterprise’s name;
8. Internal management regime, including organizational setup, decision-making procedure, business, finance and personnel systems, etc.;
9. Business service standards;
10. Materials of application for qualification of intended senior management personnel and photocopies of Qualification Certificates of business personnel;
11. Letter of intent for agency authorization issued by an insurance company;
12. Certification document of domicile or business premises;
13. Description of computer software and hardware.
Article 14
After receipt of application materials, the CIRC may call investors together to indicate to them investment risks and conduct interviews concerning the application and make inquiries and learn about market development strategy, business development plan, internal control construction and relevant matters of the institution to be established.
Article 15
An insurance agency may set up 3 branches within 1 year after its establishment. The insurance agency institution that applies for the establishment of a branch shall fulfill the following requirements:
1. No serious violation of laws or regulations within 1 year before application;
2. Having a sound and complete internal control system;
3. The main person-in-charge to be appointed fulfills the qualification requirements specified herein;
4. Existing branches of the insurance agency operate normally;
5. Registered capital or capital contribution meets the requirements specified herein;
Article 16
An insurance agency institution established with a minimum registered capital or a minimum capital contribution specified herein may establish 3 branches. For the application for the establishment of each additional branch, registered capital or capital contribution of at least RMB 100,000 shall be added.
Where the registered capital or capital contribution of the insurance agency institution has already reached the amount required in the preceding paragraph when it applies for the establishment of a branch, it may not increase its registered capital or capital contribution.
Where the registered capital or capital contribution of an insurance agency reaches RMB 2,000,000, it need not increase its registered capital or capital contribution in order to establish a branch.
Article 17
For the application for establishing a branch, an insurance agency institution shall submit the following materials in duplicate:
1. “Application Form for Establishment of Insurance Agency Branch” ;
2. The resolution of the board of directors or all partners for establishing a branch;
3. The internal management framework of the branch to be established;
4. Audit report of the insurance agency institution for the previous fiscal year issued by an accounting firm;
5. Description of the supervision and inspection of insurance regulatory authority, administration of industry and commerce and taxation authority that the agency institution have accepted in the last year and relevant appendices;
6. Description of the enforcement of the insurance agency institution’s agency contract in the last 2 years;
7. Materials of application for qualification of the main person-in-charge to be appointed;
8. Certification document of business premises;
9. Description of computer software and hardware.
Where an increase of registered capital or capital contribution is required, the capital verification certificate issued by a capital verification organization with statutory qualification and the photocopy of the original bank receipt voucher evidencing payment of capital shall also be submitted.
Article 18
The CIRC shall examine the application for establishment of an insurance agency institution or its branch in accordance with the law and, within 20 days from the date of accepting the application, make a decision as to whether or not to approve the establishment. Where it decides not to approve the establishment, it shall notify the applicant in writing and state reasons therefor.
The CIRC may conduct an on-site checking and acceptance inspection according to its actual needs.
Article 19
Where the CIRC decides to approve the establishment of an insurance agency institution or a branch of an insurance agency institution, it shall issue a license to the applicant.
After receipt of the license, the applicant shall go through procedures of industrial and commercial registration according to relevant regulations and may commence business only after receiving a business license.
Article 20
Any insurance agency institution and its branches established in accordance with the law shall make announcements on the newspapers designated by the CIRC within 10 days from the date of business commencement.
Article 21
An insurance agency institution shall deposit guarantee funds or purchase professional liability insurance.
Where an insurance agency institution chooses to deposit guarantee funds, it shall deposit 20% of its registered capital or capital contribution as guarantee funds within 20 days after industrial and commercial registration.
Where an insurance agency institution increases registered capital or capital contribution, it shall correspondingly increase the amount of guarantee funds.
Article 22
The guarantee funds of an insurance agency institution shall be in the form of bank deposit or other forms recognized by the CIRC.
Guarantee funds in the form of bank deposit shall be put in a special account with a commercial bank operating nationwide. The deposit agreement shall contain the following provision: "Without the CIRC's written approval, no insurance agency institution shall use or dispose of guarantee funds. Where the bank fails to perform the obligation of examination, it shall bear a joint liability for the debt of the insurance agency institution within the limit of guarantee funds used."
Article 23
An insurance agency institution shall submit a photocopy of the deposit agreement of guarantee funds to the CIRC within 10 days from the date of the deposit of guarantee funds into the special account opened with a commercial bank.
Before January 31 of each year, an insurance agency institution shall submit to the CIRC a special report on the management of its guarantee funds of the last year.
Article 24
An insurance agency institution shall not use guarantee funds, except in one of the following circumstances:
1. Reduction of registered capital or capital contribution;
2. Entry into liquidation procedure in accordance with these Rules.
Article 25
Where an insurance agency institution applies for using guarantee funds due to reduction of registered capital or capital contribution, the following materials shall be submitted to the CIRC:
1. Application letter;
2. Materials certifying alteration of industrial and commercial registration concerning the reduction of registered capital or capital contribution.
Article 26
Where an insurance agency institution enters into liquidation procedure according to these Rules and applies for using guarantee funds, the liquidation committee shall submit the following materials to the CIRC:
1. Application letter;
2. Liquidation plan;
3. Certification of the recovery of various documents issued by the principal insurance company;
4. The original license.
Where an insurance agency institution is dissolved, the resolution of the shareholders’ meeting or meeting of all partners for dissolution and liquidation matters shall also be submitted. Where an insurance agency institution is declared bankrupt in accordance with the law, relevant documents shall also be submitted.
Article 27
The License shall be placed at a conspicuous place in the business premises.
Article 28
The validity period of the license of an insurance agency institution is 2 years. The insurance agency shall apply to the CIRC for renewal 30 days before the expiration. To apply for the renewal of the license, the insurance agency shall submit the following materials:
1. Application letter;
2. The original license;
3. Audit report for the previous fiscal year issued by an accounting firm;
4. Balance sheet and profit statement by the end of the month before application;
5. Description of the insurance agency institution’s compliance with insurance regulatory laws and regulations in the last 2 years;
6. Description of supervision and inspection of insurance regulatory authority, industrial and commercial administration and tax authority that the insurance agency institution has accepted in the last 2 years and relevant appendices;
7. Description of supervision of insurance industrial organizations that the insurance agency institution has accepted in the last 2 years;
8. Description of the institution’s agency contract enforcement in the last 2 years.
Article 29
The CIRC shall not renew the license of an insurance agency in any of the following circumstances,:
1. No business conducted in the 6 consecutive months before the application of the renewal of the license;
2. Failure to conduct normal operation due to disorderly internal management;
3. Senior management personnel and business personnel do not fulfill the requirements specified in these Rules;
4. Failure to pay regulation fee in accordance with relevant stipulations.
Article 30
Where an insurance agency institution applies for the renewal of the License, the CIRC shall conduct comprehensive examination and evaluation of the operating status of the insurance agency institution in the last 2 years before the expiration of the license and make a decision as to whether or not to approve the renewal of the license . Where it decides not to renew the license, it shall state reasons in writing.
Article 31
No insurance agency institution or its branches shall forge, alter, rent, lend or transfer the license.
Section 2 Alteration and Termination
Article 32
An insurance agency institution shall report to the CIRC for approval of the following alterations:
1. Change of registered capital or capital contribution;
2. Change of organizational form.
Article 33
Where an insurance agency institution seeks to change its registered capital or capital contribution, it shall submit the following application materials to the CIRC in duplicate:
1. Application Form for Alterations of Insurance Agency Institution;
2. Resolution of shareholders’ meeting or resolution of all partners for the alteration;
3. Photocopies of identity certificates and resumes of new natural-person shareholders or partners, photocopies of business licenses of new non-natural-person shareholders and their financial statements of the latest year and such statement shall be stamped with the seal of finance;
4. Capital verification certificate issued by a capital verification organization with statutory qualification;
5. Amended articles of association or partnership agreement;
6. Where the insurance agency institution reduces its registered capital or capital contribution, it shall submit the evidence to prove that it has made announcements on newspapers for at least 3 times;
7. Other materials specified by the CIRC.
Article 34
Where an insurance agency applies for the alteration of organizational form, it shall fulfill the requirements for the establishment of a new organizational form and submit the following application materials to the CIRC in duplicate:
1. Application Form for Alteration of Insurance Agency Institution;
2. Resolution of shareholders’ meeting or resolution all partners for the alteration ;
3. Amended articles of association or partnership agreement;
4. Implementation plan;
5. Other materials specified by the CIRC.
Article 35
Within 20 days after accepting the application, the CIRC shall make a decision as to whether or not to approve the alteration of an insurance agency institution . Where it decides not to approve the application, it shall notify the applicant in writing and state reasons therefor.
Article 36
Where an insurance agency institution falls into one of the following circumstances, it shall report to the CIRC in writing within 5 days from the date of alteration of industrial and commercial registration:
1. Change of name;
2. Change of domicile or business premises;
3. Change of shareholders or investors;
4. Change of the names of promoters, shareholders or investors.
Article 37
Where a branch of an insurance agency institution makes the following alterations, it shall report to the CIRC in writing within 5 days from the date of alteration of industrial and commercial registration: