BIZCHINA / Finance
Insurance Law of the People's Republic of China
Updated: 2006-04-18 09:11
Article 132. For insurance companies and their personnel the withholding
of material information related to the insurance contract, cheating the
Applicant, the Insured and the Beneficiary, or refusal to make
compensation or payment of insurance money as agreed in the insurance
contract shall constitute a crime, and criminal liability shall be borne.
For those cases where criminal liability is not prosecuted, the financial
supervision and management departments in charge shall impose a fine of
not less than RMB10,000 and not more than RMB50,000 on the insurance
company. Personnel who violate laws and regulations shall be punished and
fined not more than RMB10,000.
Insurance companies and their personnel who prevent the Applicant from
performing the obligation of telling the truth, or mislead the Applicant
in violation of such obligation, or promise the Applicant, the Insured
and the Beneficiary illegal insurance commission or other benefits, shall
be regulated by the departments in charge, and the insurance companies
shall be fined not less than RMB10,000 and no more than RMB50,000, the
violators shall be punished and fined no more than RMB10,000.
Article 133. If they cheat the Applicant, Insured or the Beneficiary when
conducting insurance business, Insurance Agents and Insurance Brokers
shall be compelled to correct their actions by the departments in charge
and be fined between RMB10,000 and RMB50,000; if the case is serious, the
license for conducting insurance agency business or license for brokerage
shall be revoked. Criminal liability shall be prosecuted if the case
constitutes a crime.
Article 134. Insurance personnel who take advantage of professional
convenience to purposely invent insured events that never occurred to
falsely settle a claim and gain insurance money shall bear criminal
liability.
Article 135. Insurance companies and business personnel who violate the
stipulations of this Law and establish an insurance company without
authorization or illegally engage in insurance business shall bear
criminal liability, and such activities shall be banned by the
departments in charge. If the case is slight and does not constitute a
crime, disciplinary action shall be carried out.
Article 136. Insurance companies and their personnel who violate the
stipulations of this Law and conduct insurance business beyond the
permitted business scope shall be compelled to correct their actions by
the departments in charge and refund insurance premiums. Any illegal
income shall be confiscated, and a fine of one to five times of the
amount shall be imposed; or a fine of over RMB10,000 and under RMB50,000
if no such illegal income exists. Persons who do not correct their
activities within the set period or cause severe results shall be asked
to stop the business and the license for conducting insurance business
shall be revoked.
Article 137. Insurance companies and their personnel who violate the
stipulations of this Law, alter the following items without authorization
such as the name of the insurance company, disciplines, the paid-in
currency capital funds, the business site, etc. shall be asked to correct
their actions by the departments in charge and shall be fined between
RMB10,000 and RMB50,000.
Article 138. Insurance companies and their personnel who violate the
stipulations of this Law and fall into any of the following categories
shall be corrected and shall be fined over RMB50,000 and under RMB300,000
by the State departments in charge; in severe cases, the departments in
charge can limit the insurance company's business scope, prevent them
from accepting new business or revoke the license for conducting
insurance business:
(1) Failure to set aside guarantee money as stipulated or illegally use
of guarantee money;
(2) Failure to set aside or retain reserve funds for unrealized
commitments as stipulated or fail to set aside outstanding loss reserve
funds as stipulated;
(3) Failure to set aside public reserve funds and total reserve funds;
(4) Failure to undertake outward reinsurance business as stipulated;
(5) Violation of stipulations for the use of the insurance company's
funds;
(6) Establishing branches or representative offices without proper
authorization;
(7) Split or merger without proper authorization.
Article 139. In the event an insurance company fails to correct any of
the following circumstances within a time limit stipulated by the
departments in charge a fine of over RMB10,000 and under RMB100,000 shall
be imposed:
(1) Failure to submit relevant reports, sheets, documents and materials
as stipulated;
(2) Failure to report for registration of insurance items and insurance
ratio of the proposed insurance types as stipulated.
Article 140. Any insurance company that violates the stipulations of this
law, and fails to correct any of the following circumstances, shall be
fined over RMB10,000 and under RMB50,000 by the departments in charge:
(1) Providing false reports, sheets, documents and materials;
(2) Refusal of or interference with legal examination and supervision.
Article 141. Any insurance company that violates the stipulations of this
law, and fails to correct any of the following circumstances, shall be
fined of over RMB50,000 and under RMB300,000 by the departments in charge:
(1) Undertaking insurance business in excess of stipulated insured
amounts;
(2) Application for life insurance with death as a condition for making
payment of insurance money for persons with no civil capacity of action.
Article 142. Any insurance company that violates the stipulations of this
law, fails to obtain proper license for conducting insurance agency
business or license for brokerage, illegally conducts insurance agency
business or engages in brokerage, shall be banned by the departments in
charge. Illegal income shall be confiscated, and a fine of five to ten
times of that amount shall be imposed. Criminal liability shall be
prosecuted if the case is serious enough to constitute a crime.
Article 143. To insurance company's senior management or other persons
who are directly responsible for violations which do not constitute
crimes, the departments in charge shall issue a warning, dismissal or
replacement, or impose a fine between RMB5,000 and RMB30,000, according
to specific circumstances.
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