China launches pilot program for insurance fund investments in gold

China on Friday launched a pilot program allowing certain insurance companies to invest in gold as part of their medium to long-term asset allocation strategies.

The move aims to broaden the channels through which insurance funds can be utilized, optimize the structure of insurance asset allocation, and enhance the asset-liability management capabilities of insurance firms, according to the National Financial Regulatory Administration.

Ten insurance companies are participating in the pilot program, which permits gold investments through various means. These include spot contracts for gold traded on the main board of the Shanghai Gold Exchange, deferred delivery contracts for gold, centralized pricing agreements, spot inquiry contracts, swap contracts for gold inquiries, and gold leasing operations.

The pilot program is expected to deepen the reform in insurance fund utilization and promote high-quality development in the insurance industry, according to the administration.