The Chairman of the insurance regulator in China, the China Insurance Regulatory Commission, recently commented to the press that an insurance exchange will be set up in Shanghai as part of the central government's plan for Shanghai to become an international financial centre.
Whilst no specific details were given, there was a press report in February 2011 that the relevant government authorities are currently reviewing a proposal from the Shanghai government to the State Council to set up an insurance exchange. According to the press report, the proposed insurance exchange would initially provide a centralised trading platform for reinsurance, property insurance, liabilities insurance and group life insurance products with risk securitization products, such as catastrophe bonds and insurance derivatives being provided at a later date.
In addition, the insurance exchange may provide information relating to insurance brokers, insurance assessors and other insurance intermediaries. It is thought that participants in the exchange will include life insurers, property and casualty insurers, reinsurance companies and insurance intermediaries. However, it remains unclear as to whether foreign insurers will be allowed to trade on the insurance exchange.
If you would like to discuss anything regarding this alert please contact either Teresa Ma, Fang Jian or Eric Liu
