1. Daily expenses: such as salary, salary, venue, activities, etc.
2. Investment: generally equity, bonds, savings, real estate, etc.
In order to regulate the investment behavior of insurance funds in equity, guard against investment risks, ensure the safety of assets, and safeguard the legitimate rights and interests of insurers and insured persons, the China Insurance Regulatory Commission has formulated the Interim Measures for the Investment of Insurance Funds in Equity.
Chapter V Risk Control
Article 24 Insurance funds should pay attention to infrastructure such as investment management system, risk control mechanism, investment behavior norms and incentive and restraint arrangements, establish business processes such as project evaluation, investment decision-making, risk control, asset custody, follow-up management and emergency response, formulate risk budget management policies and crisis solutions, implement comprehensive risk management and continuous risk monitoring, and prevent operational risks and moral risks.
Article 25 When an insurance company invests in the equity of an enterprise, it shall carefully consider the solvency and liquidity requirements according to the characteristics of insurance products, the capital structure, the needs of debt matching management and relevant regulatory provisions, rationally use funds, realize asset diversification and disperse investment risks.
Twenty-sixth insurance funds to invest in enterprise equity, should abide by these measures and relevant regulations, to ensure that the investment projects and operation methods are legal and compliant. The invested enterprise shall comply with the provisions of national laws and regulations and these Measures, and have complete business requirements.
Twenty-seventh insurance funds to invest in enterprise equity, should establish a major emergency mechanism. The emergency response mechanism includes but is not limited to risk situation, emergency plan, work target, reporting route, operation flow and treatment measures. When necessary, the emergency response mechanism should be started in time to control and reduce losses as much as possible.
An insurance company shall establish a system of accountability. If senior managers and major business personnel violate the regulatory provisions and the company management system, fail to perform or perform their duties incorrectly, resulting in asset losses, they shall be investigated for responsibility. Where senior managers and major business personnel of non-insurance institutions are involved, the insurance company shall investigate their responsibilities in accordance with relevant regulations and contractual agreements.
Article 28 An effective withdrawal mechanism shall be established when insurance funds invest in the equity of an enterprise. Exit methods include but are not limited to listing, repurchase, agreement transfer and trading or liquidation of investment funds.
Insurance funds can be used to invest in enterprise equity through debt-to-equity swap or debt-to-equity swap.
Article 29 When an insurance company invests in the equity of an enterprise, it shall, in accordance with relevant regulations and contractual stipulations, require the investment institution to fulfill its information disclosure obligations to the company and relevant parties. Information disclosure at least includes the investment team, investment operation, project operation, asset value, follow-up management, key personnel changes, as well as the operation and management of the invested enterprise, major risks and major events, including but not limited to equity disputes, debt disputes, judicial proceedings, etc.
There shall be no false statements, misleading statements, major omissions or fraud in information disclosure. Investment institutions shall bear legal responsibility for the timeliness, accuracy, authenticity and integrity of information disclosure.
Further reading: How to buy insurance, which is good, and teach you how to avoid these "pits" of insurance.