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A misty day in Shanghai: Opaque insurance practices could come back to haunt China.   © Getty Images

Line between insurance, shadow banking blurs in China

Insurers are raking in cash but where is the money going?

YUSHO CHO, Nikkei staff writer | China

SHANGHAI China's insurance market is growing by leaps and bounds, thanks in part to interest rate liberalization that has triggered intense competition. But as more and more citizens take out policies, there is concern over where some of their money is winding up.

Contributions to investment accounts tied to universal life policies totaled 1.19 trillion yuan ($172 billion) for 2016 -- more than double the figure logged two years earlier. "Universal policies are a good option because their yields are attractive," said a 30-something woman listening to a sales pitch at Ping An Bank in Shanghai.

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