China issues guidance for internal control of insurance funds

China's insurance regulator on Tuesday issued a guidance for internal control of insurance funds partly to raise the sector's risk management capability.

The China Insurance Regulatory Commission (CIRC) said in a statement on its website that the guidance will improve internal control for the use of insurance funds, enhance the sector's ability to manage risks and help the sector be prudent in investment and prevent risks.

Along with the guidance, the CIRC also unveiled three separate documents to set standards and procedures for insurance funds' investment in bank loans, fixed-income products, stock and mutual funds investing mainly in stocks.

For stock and mutual funds, insurance institutions should set up a management system to limit maximum transactions and losses to keep risks within control, the guidance showed.

They should also step up monitoring to avoid violations including insider trading, interest transfer and price manipulation, and report abnormal information according to laws and regulations, the CIRC said. Endi