Shanghai's aspirations to build itself into a global reinsurance center will be further consolidated as an international board for reinsurance trading and supportive regulations are all in the pipeline, said officials at a news conference in Shanghai on Wednesday.

An international reinsurance trading market, or reinsurance international board, will be launched in Shanghai in the near future, Zhang Zhongning, deputy director of the general office of the National Administration of Financial Regulation, said at the conference.

The trading system and related rules, such as registration management regulations for international reinsurance inflow business, clearing and settlement methods for on-site cross-border transaction facilitation, and operational guidelines for solvency reinsurance credit risk, will all be finalized, Zhang said.

On top of that, an international reinsurance function zone will be set up in Lingang Special Area — part of the China (Shanghai) Pilot Free Trade Zone included in August 2019. By setting up reinsurance operation facilities in Lingang or opening accounts via the international reinsurance business platform in the area, insurers from home and abroad will be able to launch reinsurance business in the area while enjoying favorable tax and cross-border capital policies as well as differentiated supervision measures, he added.

Reinsurance, or insurance for insurers, covers insurers against accumulated liabilities by increasing their ability to withstand financial burdens when unusual or major events and calamities occur.

In the guideline released in July 2021 to develop Shanghai's Pudong New Area into a pioneer of socialist modernization, the central authorities expressed for the first time their support to build an international reinsurance center in Shanghai.

A guideline with 13 detailed measures was released in late October 2021 to help achieve the above goal. The construction plan for the reinsurance international board was released during the 4th Lujiazui International Reinsurance Conference held in late November, with preparatory work already underway.

By the time the conference was held, over 500 overseas reinsurance policyholders had participated in China's reinsurance market, reflecting the appeal of the Chinese insurance market, said Liang Tao, vice-chairman of the then China Banking and Insurance Regulatory Commission, which is now incorporated into the NAFR.

Reinsurance plays an important role in promoting the industry's risk protection capabilities and enhancing risk management levels, said Liang.

Experts from China Re Group said that the international board will facilitate China's high-level two-way opening-up. China's reinsurance industry will thus be able to deeply participate in global risk management and create room for deeper cooperation, they said.

State-owned China Re Group is the largest reinsurance player in China and Asia, with its 2022 consolidated gross written premiums up 4.3 percent year-on-year to over 169.7 billion yuan ($23.9 billion).