The comprehensive reform of auto insurance has been conducted for more than two years, during which the auto insurance market has been stable and orderly, consumers have generally benefited from the process, and the operation of property and casualty insurance companies has improved significantly. In order to implement the guidance of the Central Economic Work Conference, and in accordance with the overall requirements of the Notice of the CBIRC on the Guiding Opinions on Implementing Comprehensive Reform of Auto Insurance, the CBIRC recently issued the Notice on Expanding the Floating Range of Independent Pricing Coefficients of Commercial Auto Insurance and Other Related Matters (hereinafter referred to as the “Notice”), so as to improve the market-oriented and risk-based formation mechanism of auto insurance terms and rates, optimize the supply of auto insurance products, and expand the coverage of auto insurance. Efforts will be strengthened to effectively improve the quality and rationally increase the supply of auto insurance services, and promote the high-quality development of auto insurance.

The Notice consists of five parts. 

First, it specifies that the floating range of the independent pricing coefficients of commercial auto insurance are expanded from [0.65, 1.35] to [0.5, 1.5]. 

Second, it requires that the CBIRC local offices should steadily determine the implementation time of the policy in their respective jurisdictions according to the situation of the auto insurance markets in the jurisdictions, and on the basis of soliciting opinions from relevant parties. 

Third, CBIRC local offices should strengthen their supervision responsibilities, guide companies to reasonably set the range of average independent pricing coefficients and the upper limit of handling fees in each region, as well as continuously conduct market surveillance and retrospective supervision of auto insurance rates , so as to ensure the smooth and orderly operation of the auto insurance market. 

Fourth, it requires that companies should strictly implement regulatory requirements for auto insurance, fulfill the filing requirements of terms and rates, actively assume social responsibilities, optimize and guarantee the supply of auto insurance products, and improve the service of auto insurance underwriting and claim payment, so as to enhance the sense of gain of auto insurance consumers. 

Fifth, the Insurance Association of China, the China Association of Actuaries and the China Banking and Insurance Information Technology Management Co., Ltd. should cooperate to deepen the reform of auto insurance according to their own responsibilities.

Appendix: (Chinese)

Notice of the CBIRC on Further Expanding the Floating Range of Independent Pricing Coefficients of Commercial Auto Insurance and Other Related Matters