China Fund News Chenxi
The first fine issued by the State Administration of Financial Supervision and Administration in 2024 was issued to Zhongan Property Insurance.
On April 24, the official website of the State Administration of Financial Supervision and Administration posted the gold penalty decision [2024] No. 1 fine. Zhongan Online Property Insurance Co., Ltd. was fined 1.8 million yuan by the State Administration of Financial Supervision and Administration for concealment of related party relationships and related party transactions, false payment of expenses through related parties, and other violations of laws and regulations, and the three then deputy general managers were warned and fined.
In this regard, Zhongan Property Insurance said that the company has completed the rectification of relevant problems and will take this as a lesson to continuously improve the level of legal compliance operation.
Involved in four violations of laws and regulations, Zhongan Property Insurance was fined 1.8 million yuan
First of all, let's take a look at the problems of Zhongan Property Insurance:
After investigation, the main violations of laws and regulations of Zhongan Property Insurance include: first, concealing related party relationships and related party transactions, second, falsely listing expenses through related parties, third, misreporting and omission in the statements submitted through the related party transaction supervision system, and fourth, using the investment assets formed by the use of insurance funds to issue loans to others.
According to the Insurance Law and relevant regulations, insurance companies shall submit relevant reports, statements, documents and materials in accordance with the provisions of the insurance regulatory authority. The solvency report, financial accounting report, actuarial report, compliance report and other relevant reports, statements, documents and materials of the insurance company must truthfully record the insurance business matters, and there shall be no false records, misleading statements and material omissions.
In terms of insurance funds, the use of funds by insurance companies is limited to bank deposits, buying and selling bonds, stocks, securities investment fund shares and other securities, investing in real estate, and other forms of capital use prescribed by the State Council. Insurance companies are not allowed to use the investment assets formed by the use of insurance funds to provide guarantees or issue loans to others.
In the end, the State Administration of Financial Supervision fined Zhongan Property Insurance 1.8 million yuan, and issued warnings to Song Zhenhua, Daniel Zhang and Li Gaofeng, the three deputy general managers of Zhongan Property Insurance at the time, and fined 70,000 yuan, 100,000 yuan and 70,000 yuan respectively; the date of punishment is April 16, 2024.
According to the information disclosed on the official website of Zhongan Property Insurance, Song Zhenhua is the deputy general manager of Zhongan Property Insurance, who has worked in large enterprises such as Ping An of China, and has a senior technical development background and experience in Internet products and platform operations. Daniel Zhang is the deputy general manager, compliance officer and chief legal officer of Zhongan Property Insurance, and has many years of experience as a practicing lawyer. Li Gaofeng is the executive director, deputy general manager, chief financial officer and chief investment officer of Zhongan Property & Casualty Insurance, and has a deep background in the financial industry.
Zhongan Property & Casualty Insurance: Rectification has been completed and the level of compliance operation has been continuously improved
According to public information, Zhongan Property Insurance is the first Internet insurance company in China, which opened in November 2013. In September 2017, Zhongan Property Insurance was listed on the Hong Kong Stock Exchange, and the stock is referred to as Zhongan Online. On April 24, Zhongan Online closed at HK$12.24 per share, an increase of 2.68% on the day, with a total market capitalization of HK$18 billion.
Zhongan P&C Insurance is headquartered in Shanghai, does not have any branches, and conducts its business entirely through the Internet. According to the information on the official website, as of mid-2023, Zhongan has served more than 500 million users and issued a total of about 57.4 billion insurance policies.
In terms of shareholder information, Zhongan P&C Insurance holds more than 5% of the shares, including Ant Technology Group Co., Ltd., Ping An Insurance (Group) Co., Ltd., Shenzhen Jiadexin Investment Co., Ltd., Shenzhen Tencent Computer System Co., Ltd., etc.
On April 24, Zhongan Property Insurance also announced the administrative penalty on its official website. Zhongan Property Insurance also said that the company has completed the rectification of relevant problems and will take this as a lesson to continuously improve the level of legal compliance operation.
In terms of performance, on the evening of April 24, Zhongan Property Insurance disclosed its 2023 annual report. In 2023, Zhongan Property Insurance will achieve a total premium of 29.501 billion yuan, a year-on-year increase of 24.7%, and issue 12.234 billion policies. In terms of total premiums, Zhongan P&C Insurance ranked 9th in China's P&C insurance industry in 2023, and ranked first in the domestic Internet P&C insurance market share of 24.4%.
In 2023, Zhongan Property Insurance's net profit attributable to its parent company will be 4.078 billion yuan, turning losses into profits. Zhongan P&C Insurance said that the profit was mainly due to the improvement in the profit of the insurance segment due to the improvement in investment income, and the recognition of a one-time investment income of 3.784 billion yuan after Zhongan International ceased to be a subsidiary of Zhongan P&C Insurance and was listed as a joint venture.
However, in recent years, Zhongan Property Insurance has been fined continuously. In July 2023, an investigation by the former Jiangsu Banking and Insurance Regulatory Bureau found that Zhongan Property Insurance had falsely listed expenses from July 2021 to September 2021. The former Jiangsu Banking and Insurance Regulatory Bureau decided to fine Zhongan Property Insurance 350,000 yuan, and gave warnings and fined 70,000 yuan to the relevant responsible persons.
In April 2023, the former Hubei Banking and Insurance Regulatory Bureau investigated and found that Zhongan Property Insurance had problems with the facts when selling "Worry-free Comprehensive Accident Insurance" through a third-party online platform from December 2019 to December 2021. The former Hubei Banking and Insurance Regulatory Bureau fined Zhongan Property Insurance 300,000 yuan, and warned the relevant responsible persons and imposed a fine of 100,000 yuan.
Editor: Joey
Review: Xu Wen