The China Banking and Insurance Regulatory Commission, together with the Ministry of Industry and Information Technology, the Ministry of Transport and the Ministry of Commerce, issued guidance to deepen reform and strengthen regulation of new energy vehicle (NEV) motor insurance, aiming to improve coverage availability and pricing. The measures respond to problems including higher claim frequency and repair costs, mismatches between risk and price for some models, difficulties obtaining cover, higher premiums for some models and continued underwriting losses. The guidance targets both costs and underwriting. It calls for lowering NEV repair and use costs by broadening spare-parts supply channels, improving standardisation of repairs and claims, promoting better driving and usage habits, and enabling compliant cross-industry data sharing, alongside exploring an insurance model risk-grading framework to improve pricing accuracy. To address “hard-to-insure” high-loss vehicles, it promotes a high-payout risk sharing mechanism and an online Car Insurance Easy to Insure platform that connects owners facing difficulties in regular channels with insurers, with property insurers not permitted to refuse coverage. Other measures include optimising the floating range for the commercial motor insurance autonomous pricing coefficient, enriching products (including “basic plus variable” combinations and cover for battery-vehicle separation models), and refining benchmark rates and new-model pricing standards using factors such as vehicle price, range, performance, safety configuration and risk grade. It also tightens supervisory expectations on claims handling quality, market order, rate back-testing oversight, self-discipline and consumer protection, while asking insurers to strengthen management and prepare for the effects of intelligent driving on risk, liability allocation and data needs. Implementation is to be supported by inter-ministerial coordination through a regular liaison mechanism, with lawful data sharing and industry collaboration to drive rollout.
China Banking and Insurance Regulatory Commission 2025-01-24
China Banking and Insurance Regulatory Commission and three ministries issue guidance to reform new energy vehicle insurance with a high-loss risk sharing mechanism and underwriting access platform
The China Banking and Insurance Regulatory Commission and several ministries issued guidance to reform NEV motor insurance, addressing high claim frequency and repair costs. Measures include lowering repair costs, improving pricing accuracy, and facilitating coverage for high-loss vehicles through risk-sharing mechanisms and an online platform. It emphasizes enhancing claims handling, market order, and consumer protection, with inter-ministerial coordination supporting implementation.