Chapter III Article 88 stipulates that "if an insurance company goes bankrupt according to law, the bankrupt property shall pay off its bankruptcy expenses in the following order: 1. Arrears of employees' wages and labor insurance expenses; 2. Compensation or payment of insurance benefits; Third, the tax owed, and fourth, pay off the company's debts. "
The Measures for the Administration of Insurance Guarantee Fund, which came into effect on June 5438+1 October1,2005, clearly stipulates that if an insurance company is cancelled or declared bankrupt, and its liquidation property is insufficient to pay the policy liabilities, the insurance guarantee fund will adopt the way of combining the proportional compensation limit with the absolute compensation limit to provide relief to the insured or the policy transferee. Specifically, for non-life insurance policies, the losses of the insured within 50,000 yuan (including 50,000 yuan) shall be fully compensated; For the part exceeding 50,000 yuan, if the applicant is an individual, the reduction or exemption amount is 90% of the part, and if the applicant is an institution, the reduction or exemption amount is 80% of the part.
When a life insurance company is revoked or declared bankrupt, its life insurance contract must be transferred to other life insurance companies according to law. The amount of relief provided by the insurance protection fund to the transferee company of life insurance policy, if the insured is an individual, is limited to 90% of the policy benefits after the transfer; If the applicant is an institution, the policy interest after transfer shall not exceed 80% of the policy interest before transfer.
At the same time, the management measures show that if the life insurance company is not well managed, it really needs to be cleaned up and even bankrupt. Even if the policy is transferred to a new takeover company, it can only ensure that the protection responsibility of life insurance policies will not be damaged, such as life insurance, medical insurance, pension insurance and other risky insurance protection, while the investment income of new life insurance products such as dividends, investment and universal insurance may be affected. Therefore, even if the insurance company goes bankrupt due to poor management, the interests of customers of guaranteed insurance will not be affected.
The Measures also stipulate that when the insurance industry faces a major crisis, which seriously endangers public interests and financial stability, the China Insurance Regulatory Commission may use the insurance protection fund.
Further reading: How to buy insurance, which is good, and teach you how to avoid these "pits" of insurance.