SHANGHAI Dec 6 China's insurance regulator has
suspended Foresea Life, a unit of financial conglomerate Baoneng
Group, from selling "universal life" products until it addresses
problems in its management of customer accounts and information.
Foresea Life has been aggressively wresting market share
from bigger, listed peers by offering investors
guaranteed-return, higher yielding products.
It has built up stakes in a number of firms and played a key
role in the takeover battle for China Vanke
, funding a quarter of Baoneng's 25 percent
shareholding in the leading property developer.
The China Insurance Regulatory Commission (CIRC) said on its
website late on Monday that it had found problems during an
inspection of the firm in May and had asked the company to fix
It said it had decided to suspend Foresea Life with
immediate effect after receiving a report from the company on
Dec. 1 which showed that the firm had failed to make adequate
"Your firm should conscientiously improve customer service,
strengthen risk monitoring and response to maintain company
stability," the CIRC said in the statement addressed to the
A Foresea Life executive declined to comment.
"Universal life" products - life insurance policies
combining death benefits and an investment element - account for
90 percent of the company's premium income.
The company had suspended new business at its "universal
life" unit and had set up a team to respond to the regulator's
requests, the Securities Times newspaper reported.
The insurance unit has recently increased its stakes in a
number of Chinese companies including leading appliances maker
Gree Electric Appliances and medicine firm
China's top securities regulator on Monday condemned
"barbaric" share acquisitions by some asset managers, leading
shares in Gree Electric and China Vanke to tumble.
(Reporting by Brenda Goh; Additional Reporting by SHANGHAI
Newsroom; Editing by Stephen Coates)