Two more items have been added, as the personal insurance “negative list” expands again: health insurance with excessively high deductibles and low payout ratios is simply not acceptable! Dividend insurance also can’t rely on “empty promises” or painting a rosy picture.

The Daily Economic News reporter | Tu Yinghao    The Daily Economic News editor | Liao Dan

The reporter learned from the China Banking and Insurance Regulatory Commission (CBIRC) that its Life Insurance Department recently issued the 《Negative List for Personal Insurance Products (“Version 2026”)》 (hereinafter referred to as the “Negative List”).

Since the first Negative List for personal insurance products was released in 2018, regulators have continued to iterate and improve this list. It has expanded step by step from the initial 52 items to 103 items in the 2025 version, becoming a core tool for rectifying market disorder and guiding the industry back to the fundamentals of protection.

Industry insiders said that this revision closely targets the most recent kinds of market disorder in the industry, further aiming at issues such as responsibility design of medical insurance products, the “value-added whole life” mutation of increased-insurance-life policies, unreasonable actuarial assumptions, and insufficient implementation of “one set of reporting and one set of execution.” The regulatory red lines are tightened again, and stricter requirements are coming for product compliance in the industry.

Aimed at issues such as medical insurance deductibles being too high and benefit amounts for allowances being too low

Based on the 103 items in the 2025 version, the 2026 version of the “Negative List” adds 2 more items and further refines multiple provisions. In the end, it forms 105 prohibitive clauses, covering four major parts: product clause table wording, product responsibility design, product premium rate setting and actuarial assumptions, and product submission/filing management.

In the product clause wording section, it newly adds “unreasonable provisions regarding prescription review in medical insurance product clauses. It stipulates that the prescription review subject is a third-party service provider rather than an insurance institution, and it fails to clearly specify the review responsibilities that the insurance company should assume.”

In the product responsibility design section, based on the existing provisions in the original “Negative List”—“weakening the protective functions of insurance products; nursing insurance products include only nursing liability resulting from accidents; annuity insurance products have neither protective functions nor savings functions”—it newly adds content such as “setting deductibles for medical insurance too high or benefit payout ratios too low; the insured amount of fixed-sum medical allowance products is too low,” and so on.

Yang Fan, general manager of Beijing Paipaowang Insurance Agency Co., Ltd., believes that this expansion of the “Negative List” directly targets structural defects in medical insurance product design, where low customer-acquisition costs are used to mask low protection effectiveness. Unreasonable deductible settings, excessively low payout ratios, and allowance amounts that seriously deviate from a reasonable range essentially weaken the insurance’s core risk-hedging function. Such products are likely to evolve into tools for low-priced lead generation on the sales side.

In the scope of disease insurance liabilities, the original version was “disease insurance products include survival benefit payment liability or accidental death liability,” and it has been adjusted to “disease insurance products include survival benefit payment liability.” The 2026 version deletes accidental death liability, which is a loosening of disease insurance liability. According to the 《Administrative Measures for Health Insurance》, long-term critical illness/disease insurance products may include death insurance liabilities, but the death benefit amount may not be higher than the highest disease benefit amount.

Regarding the clauses of the 2026 version—“for annuity insurance, endowment-type insurance, and non-lifelong nursing insurance, adopting an increased-insurance-life-like structure”—Longge, deputy director of the Innovation and Risk Management Research Center of the University of International Business and Economics, said that product mutations are a long-standing stubborn problem in the personal insurance industry, and they are also a top priority for this regulatory effort. On the basis of the 2025 version’s prohibition on annuity insurance and endowment-type insurance being designed to match increased-insurance-life policies, the 2026 version newly prohibits non-lifelong nursing insurance from using such designs, thereby fully closing the product loophole of “turning into increased-insurance-life.”

Long-term insurance submitted to multiple channels at the same time must meet the requirement of “one set of reporting and one set of execution”

In the section on product premium rate setting and actuarial assumptions, references for life tables have been adjusted for occurrences. The 2026 version of the “Negative List” adjusts it to: the use of life tables is inconsistent with the requirements in the 《Notice of the National Financial Regulatory Administration on Relevant Matters Concerning the Publication and Implementation of the ＜China Personal Insurance Industry Experience Life Table (2025)＞》 (within which the requirements appear as ＜China Personal Insurance Industry Experience Life Table (2025)＞). It fails to prudently judge the product’s main liabilities in accordance with requirements and choose the applicable category of incidence rate tables. For cost-compensation medical liabilities included in health insurance, the evaluation assumptions related to medical expenses fail to take into account medical cost inflation factors as required.

It is understood that the 《China Personal Insurance Industry Experience Life Table (2025)》 is the fourth set of experience life tables for China’s personal insurance industry. It reflects improvements in mortality rates of the insured population (continued extension of life expectancy) and has been implemented since January 1, 2026.

Since 2025, participating policies have become the mainstream products in the personal insurance market, and potential sales misrepresentation issues are worth attention. In the section on product premium rate setting and actuarial assumptions, the 2026 version of the “Negative List” adds: “in participating insurance, the dividend allocation ratio promised in the dividend allocation policy in the product prospectus, if it exceeds the dividend allocation ratio level shown in the interest illustration.”

Actuarial Mark master (Mark) said in an interview with a reporter from The Daily Economic News that, according to prior regulatory requirements, the dividend illustration’s distribution ratio was uniformly set to 70%. Some companies, in order to break through this limitation, want to “tamper with” the wording in the product prospectus by adding an additional sentence to promise a higher dividend distribution ratio, so as to make the product more attractive. But that would also lead consumers to form overly high expectations of dividends. Combined with the recent regulatory window guidance, the dividend illustration interest rate has been lowered to 3.5%. Going forward, any behavior by which insurers try to illustrate a higher dividend level or indirectly promise customers a higher dividend expectation will be strictly prohibited.

In the section on product submission and filing management, the scope of products regarding material submission has changed. The original “Negative List” wording—“for some products, submitting product filing materials via the electronic official document transmission system”—has been changed to “submitting product filing materials via the electronic official document transmission system”; “changing ‘some materials submitted by some insurance products are not within the scope of product filing materials’ to ‘some of the materials submitted are not within the scope of product filing materials.’”

It is understood that there are natural differences in fee levels across different channels. Bancassurance channel commissions are usually higher, while internet channels are relatively lower. Some companies, when filing for products, will submit versions from multiple sales channels at the same time under the name of a low-fee channel, but in reality sell through high-fee channels, attempting to break through the “one set of reporting and one set of execution” constraint.

Under the requirements related to “one set of reporting and one set of execution,” the new “Negative List” particularly highlights long-term insurance. The original “Negative List” wording was: sales channels simultaneously report multiple of “personal agency, internet agency, bank and postal agency, and brokerage agency,” which does not comply with the requirements related to “one set of reporting and one set of execution.” In the 2026 version of the “Negative List,” this wording is changed to: for long-term insurance sales channels, multiple of “personal agency, internet agency, bank and postal agency, and brokerage agency” are submitted at the same time, which does not comply with the requirements related to “one set of reporting and one set of execution.”

Cover image source: The Daily Economic News media resources database