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Investment from China's insurance industry in 2002 equals 30 percent of the total Chinese security investment fund, says Wu Xiaoping, vice-chairman of the China Insurance Regulatory Commission (CIRC).
"The investment proportion is appropriate but I don't see any need for the insurance capital to further explore the security investment fund market," Wu said.
Wu made the remark at an insurance development forum that opened Wednesday in Beijing. He said the over-investment of China's insurance capital in the security investment fund market would pose too much risk to the industry and also went against basic investment principles.
However, Wu told the forum that the capital market played a vital role in the fast, healthy and sustainable development of China's insurance industry. But the capital market he referred to was in a broad sense, meaning the stock market, national bond market and enterprise bond market.
According to China's newly-amended insurance law, insurance capital is allowed to be invested in the domestic capital market, but all investment operations should be under the supervision of China's State Council and the CIRC.
Wu said China's insurance industry was currently booming and developing at an "unprecedented" rate. CIRC statistics showed that total assets of China's insurance sector reached 649.4 billion yuan (about US$81.2 billion) in 2002, 41 percent more than in 2001, and the available insurance capital (AIC) amounted to 579.9 billion yuan.
In 2005, China's AIC would be over 1 trillion yuan, Wu predicted.
(Xinhua News Agency February 20, 2003)
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