CHINESE mainland authorities will throw open the door for insurers to invest overseas to expand investment channels for the industry.

The China Insurance Regulatory Commission is planning to launch a ruling within a month or two on insurers' overseas investment under the qualified domestic institutional investors scheme, said Sun Jianyong, director of the commission's insurance fund management.

The ruling will allow insurers to convert their own assets into foreign currency and invest in mature overseas markets, including Hong Kong, the United States and the United Kingdom.

It is a long-awaited move within the industry.

Under a draft ruling issued for consultation in December, insurers can invest up to 15 percent of their total assets in the previous year into overseas markets.

Mainland insurance assets topped 1.97 trillion yuan (US$257.5 billion) at the end of 2006, and a 15 percent upper limit can means insurers can invest up to 296 billion yuan into overseas markets.

Shenzhen-based Ping An Insurance (Group) Co said in March it has gained a license to run its assets management firm in Hong Kong as the group's overseas investment arm, paving the way for further overseas expansion.

The Hong Kong affiliate runs Ping An Insurance's overseas investment through portfolios, including stock, funds and bonds.

"The investment expansion will be welcomed by big players which have more capital," said an official with the investment department of a medium-sized joint venture life insurer in Shanghai.

"For small players like us, we will still focus on putting most capital into fixed-return products such as bonds."

The opening of the overseas market can help broaden insurers' investment options and siphon part of China's mounting foreign exchange reserves, which surpassed US$1.2 trillion at the end of March.