US insurer Liberty Mutual said it has won approval from the China Insurance Regulatory Commission (CIRC) to establish a locally-incorporated insurance subsidiary in Chongqing municipality in southwest China.

'We received the regulatory approval on July 23,' Eddie Chen, spokesman with Liberty Mutual's Chongqing branch told XFN-Asia.

Liberty Mutual launched its Chongqing branch in early 2004, making it the first foreign insurer to expand non-life insurance business to China's vast southwestern region.

Yesterday, American International Group Inc (AIG), the world's largest insurer, said its subsidiary, AIU Insurance Co, has won approval from the CIRC to establish a wholly -wned subsidiary headquartered in Shanghai.

As part of the accords at the US-China Strategic Economic Dialogue held in May, China promised to make decisions before Aug 1 on allowing branches of foreign property insurance companies to get local incorporation.