By Joanne Chiu

Beijing has approved a Chinese insurer's plans to sell securities in London, signaling that a tie-up between the U.K. and Shanghai stock markets is no longer on hold.

China Pacific Insurance (Group) Co. said late Tuesday that China's market regulator had approved its planned listing in London. The group's shares already trade in Shanghai and Hong Kong, and it has a market value of about $33.8 billion, according to FactSet.

The issuance still requires the approval of stock exchanges and U.K. regulators. The Shanghai Stock Exchange said it was reviewing the listing plan and expected to grant approval soon.

The Shanghai-London Connect program, years in the making, so far has produced only one listing. That came last June, when China's Huatai Securities Co. raised more than $1.5 billion by selling global depositary receipts in London.

State-backed electricity provider SDIC Power Holdings Co. was set to follow, but halted its deal in December, blaming market conditions.

In January, a Shanghai Stock Exchange official and a senior banker in Hong Kong told The Wall Street Journal that the Connect program had been put on hold. Neither gave a reason for the hiatus, which came after relations between the two countries had been tested by unrest in Hong Kong.

China Pacific Insurance said it plans to issue a maximum of nearly 126 million depositary receipts, which will be backed by five times as many new ordinary shares in China. Based on Tuesday's closing share price in Shanghai, that implies a deal size of roughly $2.6 billion.

The insurer said it had secured a unit of reinsurance giant Swiss Re as a cornerstone investor. Swiss Re will buy depositary receipts equivalent to up to 1.5% of the Chinese group's total ordinary shares, and has agreed to hold them for a three-year lockup period.

Write to Joanne Chiu at joanne.chiu@wsj.com