(Insurance Law Article 97 An insurance company shall withdraw a deposit of 20% of the total registered capital and deposit it in a bank designated by the insurance supervision and administration institution of the State Council, which shall not be used except for paying off debts when the company is liquidated. )
The main investment applications of insurance companies are professional agreements, large bank deposits, bonds, stocks, funds, real estate and so on. The scope of investment is much wider than that of the old law, but the principle of stability and safety should be followed.
(Article 106 of the Insurance Law) Insurance companies must use their funds prudently and follow the principle of safety.
The use of funds by insurance companies is limited to the following forms:
(1) Bank deposits;
(2) buying and selling bonds, stocks, shares of securities investment funds and other securities.
(3) investing in real estate;
(four) other forms of use of funds as prescribed by the State Council.
Specific measures for the administration of the use of funds by insurance companies shall be formulated by the the State Council Insurance Regulatory Authority in accordance with the provisions of the preceding two paragraphs. )
The premium of insurance company income will be handed over to the company's asset management institution for investment and layout. Insurance companies have their own asset management teams.
(Insurance Law Article 107 An insurance company may establish an insurance asset management company with the approval of the the State Council Insurance Regulatory Authority in conjunction with the the State Council Securities Regulatory Authority.
Insurance asset management companies engaged in securities investment activities shall abide by the provisions of the Securities Law of People's Republic of China (PRC) and other laws and administrative regulations.
Measures for the administration of insurance asset management companies shall be formulated by the State Council Insurance Regulatory Authority in conjunction with relevant departments of the State Council. )
Further reading: How to buy insurance, which is good, and teach you how to avoid these "pits" of insurance.