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China regulator bars 5 insurers from transactions with shareholders, affiliates

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China regulator bars 5 insurers from transactions with shareholders, affiliates

The China Insurance Regulatory Commission barred five life insurance companies from transacting with its shareholders or related parties for six months from Oct. 10.

The regulator found issues at Bohai Life Insurance Co. Ltd. relating to the operations of the board of directors and the supervisory board, according to Oct. 11 notices. The CIRC also found that the company had incomplete records regarding related-party transactions, as well as transactions that were not reported.

The company has been barred from carrying out new transactions with its ultimate parent HNA Group Co. Ltd. for six months.

Meanwhile, the CIRC also found issues in the operations of the board at Sunshine Life Insurance Corp. Ltd., and noted that the insurer failed to report major related-party transactions. Sunshine Life has been restricted from conducting transactions with three companies related to the life insurer's parent, Sunshine Insurance Group Corp. Ltd.

Additionally, the regulator also uncovered irregular practices with respect to related-party transactions at June Life Insurance Co. Ltd, Shanghai Life Insurance Co. Ltd. and Zhujiang Life Insurance Co. Ltd.

The insurance watchdog asked the five life insurers to submit rectification reports by Nov. 30.

In July, the CIRC said it would scrutinize related-party transactions to prevent the illegal transfer of benefits from insurers to shareholders and affiliates.