China Law Insight : China Business and Intellectual Property Lawyers & Attorneys : King & Wood Law Firm : IP, Arbitration, Litigation, Securities, Foreign Investment

By Yuan Min, Partner, King & Wood's Insurance Group

Recently, the Associated Press reported that the New York State Attorney General has served subpoenas on two major multi-national life insurers as part of that office's inquiry into those companies policies for paying death benefits to life insurance policyholders' beneficiaries. This news comes after Bloomberg News reported that the United States' Department of Veterans' Affairs has begun an investigation into the possibility that life insurance companies are improperly benefiting by holding onto death benefit proceeds after these should have been paid to death benefit beneficiaries.

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China's insurance industry has experienced significant changes since its World Trade Organisation (WTO) entry. It has gone from being a predominantly closed market in the early 1990s, to one in which foreign insurers now account for more than half of all insurance companies. The Insurance Law, as the basic law governing China's insurance industry, however, have not fully reflected that growth and change.

On 28 February 2009, the Standing Committee of National People's Congress adopted the long-awaited amendments to the Insurance Law which will become effective as of 1 October 2009. A number of new provisions are included and extensive amendments to existing provisions made. Some of the key amendments are discussed below particularly those which may likely impact on the investment in, and the operation of insurance companies and insurance intermediaries in China.
 

Mark Schaub, Partner, FDI

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