On 17 August 2010 the China Insurance Regulatory Commission (the CIRC) issued basic guidelines for the internal controls at Chinese insurance companies, which include monitoring their allocation and management of insurance funds.
The CIRC is encouraging Chinese insurers to organize and implement internal control measures on insurance funds, including asset allocation, asset and liability matching, investment decision making, investment transaction management and asset custody. The CIRC's basic guidelines also require insurers to set up internal control systems to regulate both their marketing campaigns and business operations.
The CIRC hope that internal control systems will reinforce Chinese insurers' corporate governance and assist the CIRC to improve its supervision of insurance companies. The new guidelines are to take effect from 1 January 2011 and the CIRC will establish specific measures for their implementation in due course.