the China Insurance Regulatory Commission

Order of the China Insurance Regulatory Commission

No.2

The Provisions Governing Reinsurance Business, which were deliberated and adopted at the office meeting of the chairman of China Insurance
Regulatory Commission on September 26, 2005, are hereby promulgated and shall be implemented as of December 1st, 2005.

Wu Dingfu, the Chairman

October 14, 2005

The Provisions Governing Reinsurance Business

Chapter I General Provisions

Article 1

For the purpose of fostering and developing the reinsurance market, intensifying administration on reinsurance business, dispersing
the risk of insurance management, and realizing healthy, coordinated and sustainable development of the insurance industry, the present
Provisions are formulated according to the Insurance Law of the People’s Republic of China (hereinafter referred to as the Insurance
Law), the Regulations of the People’s Republic of China Governing Foreign-funded Insurance Companies and the relevant laws and administrative
regulations.

Article 2

The reinsurance as referred to in the present Provisions shall mean the business act of an insurance company which transfers part
of its insurance business to other insurance companies.

The contract reinsurance as referred to in the present Provisions shall mean the business act of an insurance company which has signed
a contract with other insurance companies beforehand, stipulating to reinsure the insurance business undertaken by it within a certain
period to other insurance companies.

The temporary reinsurance as referred to in the present Provisions shall mean the business act of an insurance company which temporarily
stipulates with other insurance companies to reinsure the insurance business undertaken by it to other insurance companies.

Article 3

The insurance company as referred to in the present Provisions shall mean the commercial insurance companies established upon the
approval of the China insurance regulatory institutions and registered according to law, including direct insurance companies and
reinsurance companies.

The direct insurance company as referred to in the present Provisions shall mean an insurance company which signs guarantee slip to
any policyholder and directly undertakes insurance liabilities; the reinsurance company as referred to in the present Provisions
shall mean the insurance company that specially undertakes reinsurance business and does not sign guarantee slip to any policyholder
directly.

The ceding company as referred to in the present Provisions shall mean an insurance company which transfers part of its insurance
business to other insurance companies; the ceded company as referred to in the present Provisions shall mean an insurance company
which assumes the insurance business transferred from other insurance companies.

The ceding business as referred to in the present Provisions shall mean the insurance business transferred out by a ceding company;
the ceded business as referred to in the present Provisions shall mean the ceded insurance business assumed by a ceded company.

The insurance association as referred to in the present Provisions shall mean an organization consisting of two or more insurance
companies, pursuant to international customs, or in order to handle any special risk or large amount of insurance business that a
single insurer is unable to undertake, which stipulate to operate insurance business jointly in light of the Article s of association.

The foreign-funded insurance company as referred to in the present Provisions shall mean the Sino-foreign joint venture insurance
company, solely foreign-owned insurance company and branches of any foreign insurance company, which are established upon the approval
of the China insurance regulatory institution.

The insurance broker as referred to in the present Provisions shall mean an insurance brokerage institution, which provides intermediary
services for ceding companies and ceded companies for their handling of reinsurance business upon the entrustment of the ceding companies,
and collects commission as stipulated.

Article 4

The present Provisions shall be complied with for the handling of reinsurance business by any insurance company, insurance association,
insurance broker and other insurance institutions within the territory of the People’s Republic of China.

Article 5

Any insurance company, insurance association or insurance broker shall follow the principles of prudence and utmost good faith when
handling reinsurance business.

Article 6

Any ceding company, ceded company or insurance broker shall be responsible for keeping secret of the business and financial information
of the aforesaid entities it knows of when handling reinsurance business.

Article 7

The China Insurance Regulatory Commission (hereinafter referred to as the CIRC) shall encourage insurance companies and insurance
brokers to provide reinsurance services positively for agricultural insurance and insurances against earthquake, flood and other
major disasters.

Article 8

The CIRC shall conduct supervision and administration on reinsurance business according to law.

Chapter II Business Operation

Article 9

Reinsurance business shall be classified into life reinsurance and non-life reinsurance. An insurance company shall make separate
accounts for the life reinsurance and the non-life reinsurance, and make business accounting separately.

Article 10

An insurance company shall, according to the provisions of the Insurance Law, determine the retention of insurance premium and the
retained risk of each dangerous entity; and reinsurance shall be made for the exceeded part.

Article 11

The direct insurance companies, when handling contract reinsurance and temporary reinsurance, shall make an offer in priority to the
insurance companies within the territory of China, and shall abide by the following provisions:

1.

It shall make an offer to at least two professional reinsurance companies within China; and

2.

The total amount of insurance shares ceded through offer shall be not less than 50% of the ceded business.

Article 12

Except aviation and spaceflight insurance, nuclear insurance, oil insurance and credit insurance, a direct insurance company shall
abide by the following provisions when handling contract reinsurance or temporary reinsurance:

1.

The business that is ceded by each risk unit to the same one ceded company shall not exceed 80% of the insured amount or the limit
of liability assumed by the direct insurance business; and

2.

The insured amount or the limit of liability assumed by the affiliated enterprises of an policyholder as ceded pursuant to a temporary
reinsurance contract shall not exceed 20% of the insured amount or the limit of liability assumed by the direct insurance business.

Article 13

Within the extending period of a legal reinsurance, a direct insurance company shall, in light of the relevant provisions of the CIRC,
handle legal reinsurance on its business in a timely manner and in full amount. The legal ceded company shall pay the insurance indemnity
as stipulated in a timely manner and in full amount.

Article 14

Upon the request of the ceded company, the ceding company shall inform the ceded company of the relevant information concerning the
liability undertaken by it and the direct insurance.

Article 15

An insurance company or insurance broker may develop and design new types of risk transfer product by making use of financial tools,
and shall report them to the CIRC for examination and approval or for archival filing in accordance with relevant provisions.

Article 16

The ceded companies within the territory of China shall be equipped with full-time reinsurance underwriters and reinsurance claimants
(claim specialists) living in the territory of China.

Chapter III Reinsurance Brokerage Business

Article 17

No insurance broker may damage the credit and the lawful rights and interests of any insurance company when undertaking reinsurance
brokerage business.

Article 18

An insurance broker may, upon the needs of business, introduce or design reinsurance contract.

Article 19

An insurance broker shall, pursuant to the stipulations with a ceding company, send bills of account, settle reinsurance money and
perform other obligations in a timely manner. No insurance broker may embezzle or withhold reinsurance premium, reinsurance recovery,
recovery commissions or recovery expenses.

Article 20

Upon the request of a ceded company, the insurance broker shall, pursuant to the stipulations with a ceding company, inform the ceded
company of the retained liability of the ceding company it knows of and the relevant information concerning direct insurance in a
timely manner.

Article 21

Upon the request of a ceding company or a ceded company, the insurance broker may cooperate for the settlement of claims on cases
of claim.

Chapter IV Supervision and Administration

Article 22

No foreign-funded insurance company may undertake reinsurance business with its affiliated enterprises unless it has been approved
by the CIRC.

Article 23

When handling reinsurance business, an insurance company shall assess the various reserves in pursuance of the actuarial theory and
method, and withdraw and transfer the various reserves accurately and in full amount according to the relevant provisions of the
CIRC.

Article 24

If the reinsurance business is involved in the solvency report of an insurance company, such content shall meet the requirements of
the rules for the compilation of solvency report of insurance companies.

Article 25

The solvency status of a branch of a foreign reinsurance company shall be determined based on of the solvency status of its parent
company.

The retained premium of a branch of a foreign reinsurance company shall be restricted by the quota authorized directly by its parent
company.

Article 26

The direct insurance companies shall submit to the CIRC the following materials before March 31 every year:

1.

Except aviation and spaceflight insurance, nuclear insurance, oil insurance and credit insurance, if it has handled contract reinsurance
and temporary reinsurance in the previous year, conditions on the transaction of the business of every risk unit ceded to the same
one ceded company which exceeds 50% of the insured amount or the limit of liability assumed by direct insurance business shall be
submitted;

2.

The shares distributed to every ceded company in the contract reinsurance of the previous year;

3.

The name list of the insurance brokers and overseas ceded companies of the previous year;

4.

The reinsurance arrangement plan of any property insurance company in the current year, including the reinsurance policy, contract
reinsurance, standard for defining risk units and the retained limit of every risk unit;

5.

The alteration of the reinsurance arrangement plan of a personal insurance company in the current year; and

6.

The conditions and standards for selecting overseas ceded companies in the current year.

Article 27

The insurance companies shall submit to the CIRC the following reports before April 30 every year:

1.

The conditions on the reinsurance business operation of the last year; and

2.

The withdrawal methods and amounts of various reserves on the relevant reinsurance business signed by the actuary.

Article 28

The direct insurance companies shall report the cases of great insurance claims and the reinsurance arrangements, the major adjustment
on reinsurance policies and other information to the CIRC in time.

The cases of great insurance claims as mentioned in the above paragraph shall refer to any case of insurance claim in one insurance
accident in which the indemnity on property loss is more than RMB 50 million Yuan or the indemnity on personnel injury or death is
more than RMB 30 million Yuan.

Article 29

The branches of a foreign reinsurance company shall submit the relevant reports to the CIRC according to the following requirements:

1.

Before July 30 every year, submitting the opinions on the solvency status or the operation status of its parent company, which are
issued by the insurance regulatory institution at the registration locality of its parent company in accordance with the local laws;

2.

Before December 31 every year, submitting the underwriting power and the amount of retained insurance premium authorized by its parent
company for the next year; and

3.

Before January 31 and July 30 every year, submitting a report concerning the transferring or ceding of insurance business, including
the name, business type, form of contract, ceding premiums, reinsurance recovery and recovery commissions of the ceding company in
the insurance transfer or ceding business.

Article 30

When handling reinsurance business, the insurance company shall, pursuant to the provisions of the CIRC, report and submit the reinsurance
statistical information and other reinsurance business materials in time and accurately.

Article 31

The insurance association shall, before March 31 every year, report to the CIRC its financial statements, business analysis report
and reinsurance outside the territory of China in the previous year.

Chapter V Legal Liabilities

Article 32

Where any insurance company handles the ceding business in violation of the present Provisions, the CIRC shall order it to make corrections
and impose upon it a fine from RMB 50,000 to 300,000 Yuan; if the circumstance is serious, the CIRC may restrict its business scope,
order it to stop accepting new business or revoke its license for operation of insurance business.

For the senior managers who are directly responsible for handling the ceding business in violation of the present Provisions and other
personnel directly liable, the CIRC may give them warnings in light of different circumstances, order them to be removed, or impose
upon them a fine from RMB 20,000 to 100,000 Yuan.

Chapter VI Supplementary Provisions

Article 33

The present Provisions shall apply to policy insurance companies for their handling reinsurance businesses by analogy. If the present
Provisions are not applicable, the policy insurance companies shall report the relevant conditions to the CIRC within 3 months as
of the day when the present Provisions are promulgated.

Article 34

The power to interpret the present Provisions shall remain with the CIRC.

Article 35

The present Provisions shall be implemented as of December 1st, 2005.