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皇冠体育app to lift rate cap on life insurance products

(Agencies)
Updated: 2010-07-12 11:52

The 皇冠体育app Insurance Regulatory Commission (CIRC)?plans to let insurance companies decide the assumed interest rate on conventional life insurance policies.

Related readings:  Limits to be relaxed soon for insurers  Insurers' Jan-April premium income up 36.58%  New rule on insurance investment coming soon  CIRC sets caps on insurance investment

皇冠体育app currently caps the assumed, or guaranteed, interest rate, the return an insurer gives to policyholders, at 2.5 percent. The higher the rate, the greater the cost for the insurance company.

In a statement on its website, www.circ.gov.cn, the CIRC said it was seeking feedback on its proposals by July 20.

皇冠体育app Life Insurance Co and 皇冠体育app Pacific Insurance (Group) Co tumbled in Shanghai trading Monday.

皇冠体育app Life, the nation' biggest insurer, fell 6.7 percent, the most since November 28, 2008, to 23 yuan as of 10:02 am local time. 皇冠体育app Pacific declined 6.7 percent. Ping An Insurance (Group) Co shares are suspended.? 

Analysts said the overall impact of lifting the cap would be limited since most policies sold in 皇冠体育app are of a different kind.