China Regulator Seeks Comment on Stricter Internet Insurance Rules

The regulatory authorities have recently sought industry feedback on matters related to further standardizing internet insurance operations, setting out a series of prohibited clauses covering marketing, products, fee deduction methods and other areas. The draft for comment uses multiple "shall not" provisions to prohibit certain practices in internet insurance involving traffic acquisition, fee deduction, products and channels, and the relevant content is still subject to confirmation through a formal document. Some institutions have already submitted feedback during the consultation process, focusing mainly on practical difficulties such as the criteria for identifying altered products, the cost of restructuring existing renewal business, and the boundaries of business scenarios.

On the marketing side, the draft requires internet insurance operators not to engage in "traffic hijacking" and not to carry out illegal marketing activities such as off-line scan-based solicitation where there is no demand. Regarding practices such as "free insurance gifts" and "one yuan for the first month," it explicitly prohibits using free insurance gifts to induce insurance purchases, illegally upgrading policies and silent renewals, and prohibits setting obstacles to surrender. On the product side, it specifies that unregistered terms and rates shall not be used, altered products with weakened protection shall not be developed, protection pricing shall not be adjusted in a disguised manner, and product upgrades shall not be used as a pretext to induce sales.

On the fee deduction side, the draft requires that important information related to fee deductions not be concealed, that imperceptible fee deductions not be carried out, and that automatic fee deductions not be made without explicit authorization. On the channel side, it requires insurance institutions not to entrust unqualified entities with insurance marketing, not to allow third parties to overstep their authority and intervene in core sales processes, not to subcontract marketing business through multiple layers, and to consolidate their own primary responsibility for operations.

Internet insurance has become an important channel for insurance sales. In 2025, internet insurance premium income exceeded RMB 700 billion, up more than 25% year on year, with an industry penetration rate of about 11.5%. After the introduction of the Measures for the Supervision of Internet Insurance Business in 2020, regulatory authorities have issued multiple documents on standardizing internet insurance.

In 2026, financial regulatory bureaus in multiple regions have started with account-related issues to investigate the problem of "account renting." Regulatory authorities require insurance institutions within their jurisdictions to conduct comprehensive self-examination and self-correction of social platform accounts other than their own online platforms, verify internal approvals, certification information and actual controllers, and focus on identifying whether accounts are leased, lent or transferred to unqualified personnel for operation.