CHINA Trends and Developments Contributed by: Wenxuan Lu, Kangda Law Firm
cannot recover payments from reinsurers after set- tlement. For example, sanction clauses might have different legal consequences for EU and Chinese enti- ties.
In recent years, China has enacted multiple relevant laws and regulations, placing significant emphasis on data security. The 2015 National Security Law incor- porated data security into the realm of national secu- rity. The 2017 Cybersecurity Law legislated on net- work data security governance. The 2021 Civil Code confirmed the property attributes of data from a civil legislative perspective. The Data Security Law and Personal Information Protection Law, implemented successively in 2021, further improved and imple- mented the basic legal framework for data security protection in China. Owing to the unique nature of the insurance industry, insurance institutions inevitably handle a vast amount of personal information – especially sensitive personal information – and must pay particular attention to data protection. This is especially true for Chinese inter- net insurance companies, which have experienced explosive growth in recent years and must ensure the security of user information due to the online nature of their business. Recently, several large insurance companies have focused on developing cybersecurity liability insur- ance products to meet the growing demand for infor- mation protection. Development of these insurance products involves complex knowledge from multiple fields, requiring the collaboration of experts in insur- ance, law, IT, data protection, etc.
Outlook and Conclusions The Russia-Ukraine war
Since outbreak of the Russia-Ukraine conflict in Feb- ruary 2022, the London insurance market’s Joint War Committee (JWC) has been updating the list of exclud- ed areas for war risk insurance. Apart from these exclusions by the JWC due to the Russia-Ukraine war, with the sanctions imposed on Russia by USA and EU countries, global insurance companies (including those in China) have generally restricted navigation in Russian regions in their maritime insurance policies. They also avoid covering any insurance settlement or peril covered with paying insurance benefit that might violate the sanctions imposed by the USA and EU on Russia. As a result, merchant ships navigating in the Russia-Ukraine war zone or undertaking special voy- ages, and those owned, managed and operated by Russian entities, are effectively “naked” without war risk coverage. The outbreak of the Russia-Ukraine conflict has also exposed Chinese enterprises’ overseas investment projects in Ukraine and Russia to political risks, high- lighting the importance of purchasing political risk insurance for Chinese overseas investments. China’s overseas investment insurance is exclusively man- aged by the China Export & Credit Insurance Corpo- ration, covering risks such as “exchange restrictions, expropriation, war and political riot, and breach of contract by host governments”. Data protection With the emergence of new generation information technologies such as 5G, artificial intelligence, cloud computing and blockchain, the global volume of data is growing exponentially. In 2023, China’s total data generation reached 32.85 ZB, a year-on-year increase of 22.44%, making it the largest and fastest-growing in the world. The importance and security of data are increasingly emphasised at the national level. Data security governance is being elevated to a strategic level of national security governance.
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