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Interpretative Letter Issued for Paragraph 9 of Article 15 of the Regulations Governing Foreign Investments by Insurance Companies
The Financial Supervisory Commission issued the interpretative letter on Paragraph 9 of Article 15 of the Regulations Governing Foreign Investments by Insurance Companies, Ref. No. Jin-Guan-Bao-Shou-Zi No. 10502548153 dated 20 January 2017, and abolished the letter issued on 10 December, 2017, Ref. No. Jin-Guan-Bao-Shou-Zi No. 10302553001. The main points are as follows:
If the product structure consolidated score of a life insurance company in the most recent year reaches 0.9 (including 0.9) but is less than 0.95, and is up 0.02 or more compared to the previous year; or the product structure consolidated score of a life insurance company in the most recent year is between 0.95 (including 0.95) and 1, and is up 0.01 or more, one of the following measures may be adopted:
(1) Within the maximum limit stipulated under Paragraph 2, Article 146-4 of the Act, the limit of overseas investment allowed under Paragraphs 1 or 4 may be increased by 1% of the funds.
(2) In the calculation formula under Paragraph 2, Article 15-2, 25% of various reserves for non-investment-linked life insurance business may be increased to 27% that is, adjusting the formula to:
Excluded Foreign Investment Amount = (27% of various reserves for non-investment-linked life insurance business, or various reserves for non-investment-linked life insurance business collected and paid in foreign currency, whichever is lower) x (1 – determined percentage).