China's insurance regulator recently visited foreign life insurance firms and intermediaries in Beijing as part of investigations into the illegal sale of insurance products in Hong Kong to mainland Chinese, the Shanghai Securities News reported on Monday without disclosing its sources.

China, which has ramped up a crackdown on illegal outflows of funds this year, is concerned that buying overseas insurance has become a way for Chinese to move money abroad, avoiding capital restrictions.

The investigation arm of the China Insurance Regulatory Commission (CIRC) found that some insurers were mis-selling insurance products, using underhanded marketing methods, the paper said.

The CIRC was not immediately available for comment.

China's biggest bank card provider UnionPay said on Saturday it will tighten regulations over how mainland customers can use its debit and credit cards to purchase Hong Kong insurance products, potentially restricting another gateway for capital flight.

China has seen a pick up in capital outflows amid concerns about a slowing economy and further depreciation in the yuan currency, which has weakened to six-year lows. That has prompted the government to plug some overseas investment channels.

Regulators have uncovered illegal capital outflows of $8.43 billion so far this year.

Overseas insurance products can serve as a store of wealth and as offshore collateral for other potential investments such as property, analysts and insurance sector insiders say.

On Friday, China's foreign exchange regulator told banks to strengthen checks on foreign exchange transactions to make sure they were genuine and based on actual needs.