With the government determined to clean up China’s insurance industry and carve a clean break from Xiang’s regulatory style and strategic vision, Chinese leaders are likely to pick someone outside the industry as his replacement, according to several sources familiar with the situation.

“Whether or not the new CIRC chairman is familiar with the insurance industry now seems less important,” said Dayton Wang, an insurance analyst with Guotai Junan International. “An industry veteran knows the loopholes and is skilled at taking advantage of the position.”

The shares of Chinese insurance companies declined on Tuesday in both mainland exchanges and Hong Kong.

China Life Insurance, the country’s biggest insurer, lost 2.2 per cent to HK$22.55 in Hong Kong and dropped 2.3 per cent to 24.05 yuan in Shanghai.

People’s Insurance Co. of China, the country’s biggest non-life insurer and whose president was hauled in for investigation on corruption charges in February, eased 1.3 per cent to HK$3.14 in Hong Kong.

The exact circumstances and charges surrounding Xiang’s dismissal have not been disclosed. He had been put under investigation since April 9 by the party’s anti-corruption body for “severe violation of party discipline” – a reason often cited in the case of Chinese government officials falling from grace.

Rumours about a possible investigation into Xiang have been swirling for months.

He is no stranger to scandals. In 2014, the New York Times reported that he made a job plea to JPMorgan Chase for a well-connected friend’s child.

In late 2016, Xiang’s former secretary Yu Ming, then head of Agricultural Bank of China’s New York branch, was dismissed from his post after the branch was fined US$215 million by the New York finance regulator due to money-laundering charges, Caixin reported.

Since last year, Beijing has declared war on so-called “financial crocodiles”, essentially business moguls that became corporate raiders and the objects of fiery rhetoric from China’s chief securities regulator Liu Shiyu, who branded them “goblins and ghouls”.

Earlier this year, Xiang told a press conference in Beijing that his agency “would never allow the insurance industry to be turned into a sanctuary or war chest of corporate raiders, buyout artists and so-called ‘financial crocodiles’ ”.

Among the super-rich targets of the recent crackdown is Xiao Jianhua, who controls Huaxia Life Insurance. Mainland police seized the billionaire from Hong Kong’s Four Seasons Hotel and spirited him across the border.

Hui Ka-yan, a Guangdong property magnate, saw his insurance arm Evergrande Life Insurance probed by authorities in December.