Table of 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 Brokerage Practitioner Qualification and Practice Certificates
Section 2 Qualification Administration of Senior Management Personnel
Chapter 4 Operating Rules
Chapter 5 Supervision and Administration
Chapter 6 Legal Liability
Chapter 7 Supplementary Provisions
Chapter 1 General Provisions
Article 1
For the purposes of regulating the business behaviors of insurance brokerage 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 brokerage 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 entity or individual shall operate or operate in a disguised form insurance broking business within the territory of People’s Republic of China.
Article 3
The CIRC shall perform the responsibilities of supervising and regulating insurance brokerage institutions and their branches according to the Insurance Law and the authorization of the State Council.
Local offices of the CIRC exercise powers and functions within the scope of authorization of the CIRC.
Article 4
As used in these Rules, the term “insurance broking business” includes both direct insurance broking business and reinsurance broking business.
Direct insurance broking refers to the following activities: insurance brokerage institutions sign contract of entrustment with insurance applicants; on behalf of the interest of insurance applicants or the insured, insurance brokerage institutions provide intermediary services for insurance applicants to enter into insurance contracts with insurance companies and accordingly obtain a commission in accordance with agreement.
Reinsurance broking refers to the following activities: insurance brokerage institutions sign contract of entrustment with the original insurance company; on behalf of the interests of the original insurance company, insurance brokerage institutions provide intermediary services for the original insurance company to do reinsurance business with reinsurance company and accordingly obtain a commission in accordance with agreement.
Article 5
As used in these Rules, “insurance brokerage institutions” refer to the entities that fulfill the qualification requirements specified by the CIRC, have obtained the license of operating insurance broking business (hereinafter referred to as the "License") with approval of the CIRC, and engages in insurance broking business.
As used in these Rules, the term “insurance brokerage branches” refers to the branch companies and sales offices that are established by the insurance brokerage institution and operate insurance broking business within the scope authorized thereby.
Article 6
All insurance brokerage institutions and their branches shall abide by laws, administrative regulations and relevant rules of the CIRC and follow the principles of volition, honesty and fair competition.
Article 7
Where insurance brokerage institutions and their branches have incurred losses upon insurance applicants, the insured or the insurance company because of fault in handling the insurance business, the insurance brokerage institutions and their branches shall bear the responsibility for compensation.
Article 8
All insurance brokerage institutions and their branches shall submit relevant materials and report true information to the CIRC according to these Rules and be responsible for the truthfulness of the substantial contents of the materials submitted.
Chapter 2 Administration of the Organization
Section 1 Establishment
Article 9
An insurance brokerage institution may take one of the following organizational forms:
1. Partnership;
2. Limited liability company;
3. Joint stock limited company.
Article 10
The following qualification requirements shall be fulfilled to establish an insurance brokerage institution:
1. Registered capital or capital contribution reaches the minimum amount specified herein;
2. The articles of association of the company 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 Qualification Certificate of Insurance Brokerage Practitioners (hereinafter referred to as "Qualification Certificate") exceeds 2 and is not less than half of total employees;
5. Sound and complete organizational structure and management system are in place;
6. Fixed domicile or business premises that matches its business scale;
7. Computer software and hardware facilities that match the business operation;
Article 11
Where an insurance brokerage institution is established in the form of partnership or limited liability company, its registered capital or capital contribution shall not be less than RMB 5,000,000. Where it is established in the form of joint stock limited company, its registered capital shall not be less than RMB10, 000,000.
Article 12
An entity or individual that is forbidden by laws and administrative regulations to invest in enterprises shall not become the initiator, shareholder or partner of an insurance broker.
Article 13
The name of an insurance brokerage institution and its branches shall contain the word "insurance brokerage" and shall not be the same with that of existing insurance intermediaries.
Article 14
To apply for the establishment of an insurance brokerage institution, all shareholders, all promoters or all partners shall designate a representative or jointly authorize an agent to handle application matters with the CIRC.
Article 15
For the application for the establishment of an insurance brokerage institution, the following materials shall be submitted in duplicate to the CIRC:
1. “Application Form for Establishment of Insurance Brokerage Institution” signed by all shareholders, all promoters or partners;
2. “A Power of Attorney Regarding Application for Establishment of Insurance Brokerage Institution”;
3. Articles of association of the company 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 or promoters 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, including analysis of market conditions and 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 system, 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. Certification document of domicile or business premises;
12. Description of computer software and hardware facilities.
Article 16
After receipt of application materials, the CIRC may call investors together to indicate to them investment risks and conduct interviews concerning application for the establishment, make inquiries and learn about market development strategy, business development plan, internal control system and relevant matters of the institution to be established.
Article 17
The CIRC shall make a preliminary examination of the application within 20 days from the date of accepting the application for the establishment of an insurance brokerage institution, and make the decision as to whether or not to approve within 40 days from the date of accepting the application. Where it decides not to approve the establishment, it shall provide the applicant with a written notice and state reasons therefore.
The CIRC may organize on-site checking and acceptance inspection according to actual demand.
Article 18
An insurance brokerage institution may set up 3 branches within 1 year after its establishment in the province, the autonomous region or the municipality directly under the central government of its domicile. Whichever applies for the establishment of an insurance brokerage branch shall fulfill the following requirements:
1. No serious illegal or regulation-violating activities within 1 year before application;
2. Sound internal control system;
3. The intended person-in-charge to be appointed shall fulfill the qualifications specified herein;
4. Existing branches of the insurance brokerage institution operate normally;
5. Registered capital or capital contribution meets the requirements specified herein;
Article 19
Where an insurance brokerage institution is established with a minimum registered capital or capital contribution required herein, after one year of its establishment, it can establish 3 branches in provinces, autonomous regions or municipalities directly under the central government other than its domicile. In addition, registered capital or capital contribution of at least RMB 1 million shall be increased to apply for the establishment of the first branch in each province, autonomous region or municipality directly under the central government other than its domicile.
Where the registered capital or capital contribution of the insurance brokerage 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 brokerage institution reaches RMB 20 million, it need not increase registered capital or capital contribution to establish a branch.
Article 20
To apply for the establishment of a branch, an insurance brokerage institution shall submit the following materials in duplicate:
1. “Application Form for Establishment of Insurance Brokerage Branch”;
2. The resolution of the board of directors or all partners for establishing an insurance brokerage branch;
3. The internal management framework of the insurance brokerage branch to be established;
4. Audit report of the insurance brokerage 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 brokerage institution have accepted in the last year and relevant appendices;
6. Materials of application for qualification of the main person-in-charge to be appointed;
7. Certification document of business premises;
8. 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 21
The CIRC shall examine the application for establishment of an insurance brokerage 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 organize on-site checking acceptance inspection according to actual demand.
Article 22
Where the CIRC makes the decision to approve the establishment of an insurance brokerage institution or a branch, it shall issue a License to the applicant.
After receipt of the License, the applicant shall go through procedures of industrial and commercial registration in accordance relevant regulations and may start business only after receiving a business license.
Article 23
Any insurance brokerage institution and its branches established according to laws shall make announcement on the newspapers designated by the CIRC within 10 days from the date of starting the business.
Article 24
Any insurance brokerage institution shall deposit guarantee funds or purchase professional liability insurance.
Where an insurance brokerage institution deposits 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 brokerage institution increases registered capital or capital contribution, it shall correspondingly increase the amount of guarantee funds.
Article 25
The guarantee funds of an insurance brokerage institution shall be paid in the form of bank deposit or other form accepted by the CIRC.
Where guarantee funds are paid in the form of bank deposit, the guarantee funds shall be deposited 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 brokerage 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 brokerage institution within the limit of guarantee funds used."
Article 26
An insurance brokerage institution shall submit a photocopy of guarantee deposit agreement to the CIRC within 10 days from the date of deposit of guarantee funds into the special account opened with a commercial bank.
Before January 31 of each year, an insurance brokerage institution shall submit to the CIRC a special report on the management of its guarantee deposit for the last year.
Article 27
An insurance brokerage institution shall not use guarantee deposit, except under one of the following circumstances:
1. Reduction of registered capital or capital contribution;
2. Entry into liquidation procedure according to these Rules.
Article 28
Where an insurance brokerage institution applies for using guarantee deposit because of decrease 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 29
Where an insurance brokerage institution applies for using guarantee deposit because of entry into liquidation procedure according to these Rules, the liquidation committee shall submit the following materials to the CIRC:
1. Application letter;
2. Liquidation plan;
3. The original License.
Where an insurance brokerage 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 brokerage institution is declared bankrupt according to laws, relevant documents shall also be submitted.
Article 30
The License shall be placed at a conspicuous place of business premises.
Article 31
The validity period of the License of an insurance brokerage institution is 2 years. The insurance brokerage institution shall apply to the CIRC for renewal 30 days before the expiration of the License. To apply for the renewal of the License, the insurance brokerage institution 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 as at the end of the month before application;
5. The statement of the status of the insurance broker’s compliance with insurance regulatory laws and regulations in the previous two years;
6. Description of supervision and inspection of insurance regulatory authority, industrial and commercial administration and tax authority that the insurance brokerage 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;
Article 32
Where an insurance brokerage institution falls into any of the following circumstances, the CIRC shall not renew the License:
1. No business conducted in the six consecutive months before applying for 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 qualification requirements specified herein;
4. Failure to pay regulation fee in accordance with relevant stipulations.
Article 33
Where an insurance brokerage institution applies for the renewal of the License, the CIRC shall conduct comprehensive examination and evaluation of the operating status of the insurance brokerage institution for the previous 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 34
No insurance brokerage institution or its branches shall forge, alter, rent, lend or transfer the License.
Section 2 Alteration and Termination
Article 35
Where an insurance brokerage institution falls into one of the following circumstances, it shall report to the CIRC for approval:
1. Change of registered capital or capital contribution;
2. Change of organizational form;
3. Change of shareholders or partners;
4. Change of equity structure or proportion of capital contribution.
Article 36
Where an insurance brokerage institution changes its registered capital or capital contribution, it shall submit the following application materials in duplicate to the CIRC:
1. Application Form for Alterations of Insurance Brokerage Institution;
2. Resolution of shareholders' meeting, or meeting of all partners;
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;