March 2, 2018
A New Insurance Security Fund for A New Era
CISFC 2018 Annual Work Conference Convened in Beijing
On February 28, 2018, China Insurance Security Fund Co., Ltd. (CISFC) held the 2018 Annual Work Conference - 2017 Annual Assessment and Recognition Conference in Beijing. Ren Jianguo, Secretary of the CISFC CPC Committee, Chairman of the Board and the General Manager of CISFC, delivered the annual work report. Zhang Zhongliang, Secretary of the CISFC Discipline Inspection Committee, highlighted the key points of the 2018 Conference on Party Conduct, Clean Governance and Discipline Inspection of the China Insurance Regulatory Commission (CIRC). At CISFC’s invitation, Guo Jing, Deputy Director-General of the CIRC Finance and Accounting Department, delivered a speech at the Conference. The Conference was chaired by CISFC Vice Chairman Yi Cheng. Vice Chairman Zhang Qiang, Deputy General Manager Wei Zhuyong, and Assistant General Manager Zhou Fuping also attended the Conference.
The Conference began by recognizing the company’s outstanding teams and individuals from 2017. Following which, Chairman Ren, structuring his messages in accordance with the Xi Jinping Thought, elucidated the key takeaways of the CIRC National Conference on Insurance Supervision (NCIS), reviewed the company’s operations in 2017, delivered an in-depth analysis on the new operating environment facing the company, and announced a comprehensive plan for the company’s various priorities in 2018.
Ren Jianguo noted the tremendous challenges before the entire insurance regulatory system in 2017. As a state-owned enterprise under the leadership of the CIRC CPC Committee, CISFC, at the former’s direction, pored over and implemented the directives of the 19th CPC National Congress, and resolved to eliminate the negative influences of Xiang Junbo. CISFC staff overcame all challenges in carrying out strict party self-governance and “Learning the party Constitution and Party regulations in order to become qualified party members”, and ensured that the party had absolute leadership over CISFC’s operations. In addition, CISFC duly carried out the tasks outlined at the NCIS and made sure the insurance industry was committed first and foremost to providing protection to the insured, achieving notable results in all lines of business. As of December 31, 2017, the Insurance Security Fund had a balance of RMB 112.502 billion (before final settlement), up 19.40% year-on-year. Property insurance fund and life insurance fund amounted to RMB 71.558 billion and RMB 40.944 billion, respectively, accounting for 63.61% and 36.39% of the total. Investment income reached RMB 3.952 billion, corresponding to a rate of return of 4.18% and 23 basis points higher than the annual target. CISFC also continued its work on the risk monitoring system, improved the risk resolution system in both theories and practices, and further enhanced the framework of the Insurance Security Fund System to enable bigger impacts on the industry.
Ren emphasized that 2018 marks the 40th anniversary of China’s reform and opening-up policy, the 20th anniversary of the establishment of CIRC, and the 10th anniversary of the founding of CISFC. To enable greater impacts of the Insurance Security Fund and manage sectoral risks more effectively, CISFC must develop a clear understanding of the new operating environment, developments, and challenges, chief among them are: (1) The emerging sectoral risks, and the resulting significant risk situations, that require CISFC to adopt a higher political perspective to better contain and isolate these risks; (2) New regulatory philosophies of China’s financial regulators, which demand better performance from CISFC; (3) New challenges from implementing the updated Measures for the Administration of the Insurance Security Fund, which is to be soon introduced; and (4) The mounting challenges in the well-management of the CISF assets due to the complex financial environment and the capital needs from risk resolution programs.
Ren noted that in 2018, under the guidance of the Xi Jinping Thought and the directives of the 19th CPC National Congress, CISFC would ensure the tasks assigned at the National Financial Work Conference and Central Economic Work Conference are fully carried out, and, as directed by the NCIS, remove Xiang Junbo’s influences and firmly uphold the leadership of the party in CISFC affairs. The CISFC was also to: (1) work with regulatory authorities in risk resolution initiatives in accordance with the Measures for the Administration of the Insurance Security Fund; (2) reform the current funds contribution model and introduce a risk-based contribution rate; (3) invest CISF assets with due diligence to ensure funds safety and liquidity while seeking higher returns; (4) improve the sectoral risk monitoring system and build related brands; (5) draw lessons from CISFC’s ten-year history and seek long-term development for both CISFC itself and the Insurance Security Fund, and make greater contributions to the management of risks and the protection of insurance consumers.
At the Conference, Zhang Zhongliang, Secretary of the CISFC Discipline Inspection Committee, recalled the key points of the CIRC Conference on party Conduct, Clean Governance and Discipline Inspection. He stressed that CISFC would uphold the authority and central leadership of the CPC Central Committee with Xi Jinping as the core, underscore the importance of political work in party-building and strengthen party competence in all respects, continue to enforce party discipline, and foster a heathy culture of integrity within the organization, so as to lay a strong foundation for the reform and development of the Insurance Security Fund. CISFC leaders at all levels should develop a stronger sense of responsibility; always remember that being a party member is their first identity, working for the party is their foremost duty, and supervising party member conduct is their top responsibility; and personally and comprehensively strengthen party discipline in all aspects and promote the top-down transfer of accountability.
Following the work report, Guo Jing, Deputy Director-General of the CIRC Finance and Accounting Department, said that the Insurance Security Fund is a risk relief fund established in early years of China’s financial industry, and while CISFC had accomplished much in 2017, the insurance industry is still facing a precarious risk position. Guo added that CISFC would have a crucial part to play in 2018, and hoped the Insurance Security Fund would become a stronger safeguard against risks to promote the sustainable development of the insurance industry.
At the end of the Conference, Vice President Yi Cheng required each department and office to study the key points of the NCIS, the CIRC Conference on Party Conduct, Clean Governance and Discipline Inspection, and the 2018 Annual Work Conference to ensure the tasks for 2018 are duly implemented.