The CIRC prohibits insurance institutions from undertaking external guarantees

Li Xinwen the CIRC 10th issued the "China Insurance Regulatory Commission on the Regulation of external security matters related to the notice", made clear that insurance companies, insurance asset management companies may not carry out external guarantees. The CIRC stated that external guarantees are guarantees provided by an insurance institution to a third party for the debts of others.　　But does not include the following actions of the insurance company in the normal management activity: The guaranty in the lawsuit, the credit guarantee related to the export credit insurance by the export credit insurance company, and the maritime guarantee. According to the notice, except the subordinate member company, the Insurance Group Company may not provide the guarantee for other companies.　　The insurance company shall abide by the relevant regulations for the security of the subordinate member companies, and the insurance organizations shall strictly prohibit the external guarantee of the branch offices, strengthen the internal control of the branches, enhance the seal management, and effectively eliminate the risk of unauthorized external guarantee by the branches. Each insurance institution shall carry out a comprehensive inventory of the external security acts which have occurred within the scope of prohibition in the parent and branch offices and submit them to the CIRC before March 31, 2011.　　If an external security Act is not prohibited within the scope of the inventory, it shall also implement zero reporting. The Insurance Regulatory Commission shall, in principle, terminate the External Security Act which has occurred within the scope of prohibition and submit the result to the CIRC before July 31, 2011. For special reasons that cannot be discharged on schedule, a written application for extension of the cancellation shall be submitted to the CIRC and the reasons are stated.