To thoroughly implement the guidance principles from the 20th CPC National Congress and the plenary sessions of the 20th CPC Central Committee, fully implement the requirements of the Opinions of the Central Committee of the CPC on Strengthening Adjudication Work in the New Era, give full play to the functional role of financial adjudication, and promote the healthy and orderly development of the property insurance industry, the Shanghai Financial Court (SFC or the “Court”) held a press conference on May 13, 2026 to release the Legal Risk Prevention Report on Property Insurance Contract Disputes (hereinafter referred to as the “Report”). This marks the fifth consecutive year that the Court has issued a financial legal risk prevention report following the establishment of its annual release mechanism for financial dispute legal risk prevention reports, after reports on private funds, bonds, finance lease disputes, and disputes involving securities-related misrepresentations. It is another important measure by which the Court leverages judicial functions to prevent financial risks and serve the development of technology finance, green finance, inclusive finance, pension finance, and digital finance（the Five Major Financial Articles).
The Report released this time focuses on the property insurance sector. In recent years, China’s property insurance industry has continued to expand. By the end of 2025, the total contracted premium of property insurance nationwide reached 1.4703 trillion yuan. Internet insurance has flourished, innovative insurance products have emerged constantly, and the industry’s digital transformation has accelerated steadily. However, prominent problems remain in industry development, including irregular sales practices of insurance companies(the insurer), inadequate fulfillment of the obligations to prompt and explicitly explain, and identified lax loss assessment and claim settlement procedures, affecting the prosperity and stability of the property insurance market and people’s sense of gain. As China’s property insurance industry continues to expand, product innovation accelerates, and consumer’s awareness of rights protection strengthens, the number of property insurance contract dispute cases has been on the rise. From the Court’s establishment through 2025, the SFC has accepted 1,952 property insurance contract dispute cases.
The Report comprises four parts: current conditions and risk overview of the property insurance industry; basic information and characteristics of property insurance contract dispute cases; major disputed issues and legal risk identification; and countermeasures and recommendations. It comprehensively summarizes the development status and risk profile of the property insurance industry, systematically reviews the characteristics of property insurance contract disputes, identifies the causes of disputes and associated risks, and proposes countermeasures for legal risk prevention in the property insurance sector.
The Report provides a statistical analysis of property insurance contract dispute cases accepted by the Shanghai Financial Court from 2018 to 2025, revealing the following characteristics:
1. Case volume shows a steady upward trend
From 2018 to 2025, the number of cases accepted grew from 32 to 346, totaling 1,952cases, showing an overall steady upward trend. This reflects, to a certain extent, the continuous expansion of business scale in the property insurance industry and the growing judicial demand for dispute resolution, while also indicating stable risk fluctuations and sound development in the property insurance industry.
2. Appellants are predominantly insurers with low willingness to settle or withdraw
The cases accepted by the Court are predominantly of second instance. Among 1,198 appeal cases in non-subrogation disputes, insurers accounted for 65.86% of appellants, with a settlement or withdrawal rate of only 15.08%, reflecting low acceptance of first-instance judgments by insurers, low willingness to settle or withdraw, and difficulties in insurance claim settlement.
3. Disputes occur mainly in traditional areas such as property damage insurance
Disputes mainly involve traditional insurance types including property damage insurance, third-party liability insurance, and employer’s liability insurance, with property damage insurance disputes accounting for 45.59%. Disputes involving new insurance products such as construction engineering quality latent defect insurance, crowdsourcing protection insurance, and litigation property preservation liability insurance have also begun to emerge, reflecting that traditional property insurance remains a high-incidence area for disputes while risks in emerging insurance businesses are beginning to surface.
4. Rising number of subrogation disputes
Insurer subrogation disputes account for 33.66% of all cases, with the number of such disputes showing an overall upward trend from 2018 to 2025. Such disputes require ascertaining the underlying legal relationship between the insured and third parties, making identification of liable parties and process of fact-finding particularly challenging, with prominent party disputes and generally lengthy trial periods.
5. Notable growth in online insurance disputes
As digital transformation in the insurance industry accelerates, online insurance disputes have increased accordingly, with cases involving electronic insurance application accounting for approximately 30%. Disputes focus on whether insurers have fully performed their duties of warning and explicit explanation, reflecting to a certain extent that rules on such duties in internet insurance remain unclear and require further standardization.
Addressing common legal disputes in judicial practice, the Report categorizes disputes into three major types: disputes over mutual assent to insurance, disputes over insurance claims, and disputes over the insurer’s right of subrogation. It systematically reviews more than twenty dispute types, including delivery of insurance clauses, interpretation of standard clauses, loss assessment standards, significantly increased extent of risk, application of international conventions, and the period of limitation of action, and, drawing on typical cases, precisely identifies the legal risks faced by different market entities.
1. Disputes over mutual assent to insurance
These disputes mainly concern the rights and obligations at the contract formation stage. Main alleged conduct includes: insurers failing to deliver insurance clauses in accordance with law; failing to perform the duties of warning and explicit explanation regarding clauses exempting the insurer from liability; mismatch in recommended insurance products; differing interpretations of standard clauses; the nature and effect of “special agreement” clauses in policies; the policyholder failing to make honest disclosure of insurance information; and entrusting unqualified personnel to apply for insurance. The Report emphasizes that ambiguous clauses in an insurance policy shall be construed against the insurer; an exclusion clause has no legal binding force if the insurer fails to perform its duty of disclosure and explanation; exemption clauses shall not constitute a special agreement if a mutual consensus through negotiation cannot be proven; recommending unsuitable products may bear the liability for culpa in contrahendo and the policyholder who fail to make honest disclosure may be unable to obtain indemnity and should carefully select insurance channels and practitioners.
2. Disputes over insurance claims
These disputes mainly focus on loss assessment, claims settlement, and contract performance after the occurrence of an incident covered by insurance. Main alleged conduct includes: disagreements between insurers and the insured over loss assessment standards for the subject matter; insurers refusing to pay indemnity without lawfully exercising the right to rescind the contract; the policyholder failing to perform dynamic reporting obligations; failure to notify insurers when the extent of risk attending the subject matter of insurance has significantly increased; the insured failing to cooperate in loss assessment or repairing the subject matter without authorization after an incident; and disputes over the determination of the validity of an endorsement , authenticity of the intent to assign the right to claim insurance benefits, interpretation of co-insurance agreements, and determination of the validity of insurance fund investment. The Report emphasizes that insurers who fail to timely and clearly exercise the right to rescind will forfeit the right to deny coverage, and must lawfully and reasonably assess losses and fulfill liability for compensation; the policyholder who fails to timely perform dynamic reporting obligations under the insurance contract risk being unable to obtain indemnity; the insured who fail to timely notify insurers of a significantly increased extent of risk on the subject matter of the insurance being unable to obtain indemnity; the insured who fail to timely notify and cooperate in loss assessment, making incident losses difficult to ascertain, may bear adverse legal consequences for the unascertainable portion; and unclear expression of intent to assign may prevent assignees from obtaining the right to claim insurance benefits.
3. Disputes over the insurer’s right of subrogation
These disputes mainly concern the exercise of subrogation rights by insurers after claims settlement. Main alleged conduct includes: differing interpretations of provisions of international conventions such as the Montreal Convention in cross-border air cargo damage recovery; insurers exercising subrogation beyond the period of limitation of action; recovery of fees for occupation of funds and liquidated damages from debtors and recovery from guarantors in surety insurance; and the insured waiving the right to claim compensation against third parties before the insurer pays indemnity. The Report emphasizes that inaccurate understanding of international convention provisions by insurers may affect recovery; failure to timely exercise litigation rights may exceed the period of limitation of action; claims for fees for occupation of funds exceeding statutory standards are unlikely to be supported; and the insured who waive the right to claim compensation against third parties may bear adverse legal consequences.
Based on the above dispute types and legal risks, the Report provides targeted legal risk prevention countermeasures and recommendations for six major market entities—the applicant (the insured), insurance companies, insurance intermediaries, internet insurance platforms, industry associations, and regulatory authorities—according to their respective roles and obligations.
Vice President of the SFC, Shan Suhua stated: “The SFC will continue to follow the guidance of the Xi Jinping Thought on Socialism with Chinese Characteristics for a New Era, fully leverage the functions of financial adjudication, further improve the annual release working mechanism for financial dispute legal risk prevention reports, continue to strengthen financial risk early warning, prevention, and resolution, and provide high-quality judicial services to support the development of the Five Major Financial Articles.”
Journalists from central and Shanghai-based media outlets attended the press conference.
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