The Guangdong Financial Regulatory Bureau has issued a circular stating that it was carrying out a probe on the illegal sales of insurance products from overseas and illegal cross-border insurance transactions in the province (excluding Shenzhen).
The Guangdong Bureau said that its investigations cover whether there are institutions and their employees involved in organising or assisting in illegal sales (including illegal publicity and promotion) of overseas insurance products and illegal cross-border insurance.
The investigations include delving into whether insurers or individuals accepted benefits from overseas institutions, promoting insurance products of overseas insurance institutions in China by inviting customers to “lectures, conferences, other activities, etc”, or through the Internet and other channels, or arranging customers who intend to purchase overseas insurance products to go abroad to complete the insurance purchase.
Bancassurance personnel, individual agents of insurance companies, personnel of professional insurance agencies, and insurance brokerages, are all included in the scope of the investigations.
The regulatory action, which began at least in September, requires institutions to submit self-inspection reports by yesterday with Guangdong regulatory sub-bureaus summarising the reports by 21 October.
The investigations were sparked by complaints from consumers to the regulatory authorities that the employees of some mainland Chinese insurers had promoted overseas insurance products to them. Some did so in the guise of "family offices" and "consulting companies".
The crackdown has also taken place in Hong Kong. In April 2024, the Insurance Authority (IA) announced that it and the Independent Commission Against Corruption (ICAC) conducted their first joint operation targeting corrupt conduct in the unlicensed sale of insurance policies to mainland China customers. Search warrants were executed by the IA and ICAC on two consecutive days (April 10 and 11) at four premises, including the offices of a licensed insurance broker company and a referral company. In the joint operation, the ICAC also arrested an individual broker and a referrer.