What if the insurance company goes bankrupt?
If bankruptcy is declared, the life insurance contract will be handed over to other insurance companies. If no other insurance company takes over, the CIRC will designate other insurance companies to take over. The institutional guarantee for the insured when the insurance company declares bankruptcy;
1. When the operating capacity of an insurance company is insufficient, the the State Council Insurance Regulatory Authority may take over it.
2. If an insurance company engaged in life insurance business is revoked or declared bankrupt according to law, its life insurance contract and liability reserve must be transferred to other insurance companies engaged in life insurance business; If the transfer agreement cannot be reached with other insurance companies, the insurance company operating life insurance business designated by the State Council Insurance Regulatory Authority shall accept the transfer. 3. Insurance premium and insurance guarantee fund system. An insurance company shall submit a deposit, pay the insurance guarantee fund, and provide relief to the insured, the insured and the beneficiary when declaring bankruptcy.
To sum up, China Banking Regulatory Commission and China Insurance Regulatory Commission merged in 20 18, and after the merger, they were called Bank of China Insurance Regulatory Commission, or China Banking Regulatory Commission for short. It can unify regulatory standards, reduce communication costs, eliminate regulatory arbitrage and many other problems, and its significance is still relatively positive.
Legal basis:
Measures of China Banking Regulatory Commission for the Administration of Normative Documents
Article 5
The formulation of normative documents should strictly implement the procedures of evaluation, consultation, legality review, collective deliberation and decision, and public release. Normative documents that need to be formulated and implemented immediately to prevent, respond to and deal with financial risks, disasters, public safety and social security emergencies, or to implement emergency orders and decisions of higher administrative organs can shorten the time limit for formulation or simplify procedures.