Insurance | Doing Business with China

After China's accession to WTO, foreign life insurance companies are permitted to have business establishments only in the form of joint ventures in China and foreign ownership in the joint venture shall not exceed 50 per cent. Within three years after accession, the foreign equity share in a joint venture is allowed to increase to a dominant 51 per cent. However, such a foreign insurance company should have more than 30 years of established experience in a WTO member state with total assets of more than US$5 billion. In addition, the foreign insurance company should have had a representative office in China for two consecutive years .
Upon approval, the formation of a branch network of an insurance company will be permitted consistent with the phase out of the geographical restrictions.
After China's accession to WTO, three more cities (Dalian, Shenzhen and Foshan) will be opened up for foreign insurance companies in addition to Shanghai and Guangzhou where foreign insurance services have already been allowed. Within two years after the accession, another ten cities (Beijing, Chengdu, Chongqing, Fuzhou, Suzhou, Xiamen, Ningbo, Shenyang, Wuhan and Tianjin) will be added to the list of areas where foreign insurance companies are allowed to provide services. Within three years after China's accession, geographical restrictions will be completely removed.
Within two years after China's accession, foreign non-life insurance companies will be permitted to establish wholly-owned subsidiaries in China. Within four years after China's accession, compulsory cession requirements will be removed. Within five years after China's accession, wholly -owned subsidiaries of foreign insurance brokers will be permitted.
Foreign life insurance companies are permitted to provide individual life insurance services to both foreigners and Chinese citizens after China's accession to the WTO. Within three years after accession, they will be permitted to provide health insurance, group insurance and pension/annuities insurance to foreigners and Chinese.