A Study On Effective Supply, Efficiency And Risk In The Chinese Insurance Industry

Effective supply, efficiency and risk of insurance industry are three key factors restricting and influencing insurance industry development, They can reflect inherently the level and quality of the insurance industry development. At the same time These three issues are also current reality problems and important problems concerning the healthy development in the future in Chinese insurance industry.Starting from an analysis of the features of the insurance industry, and based on some economics theory, financial development theory and insurance development theory, this article, with three internal conflicts as the starting point of logical analysis, constructed a frame of insurance industry development analysis based on effective supply, efficiency and risk, which locates theoretically the role, influence and interrelations of effective supply, efficiency and risks during the development of insurance industry. According to the analysis frame, this article analyzed and evaluated the situation of effective supply, efficiency and risk in the current stage of the Chinese insurance industry, on the basis of which, it judged how well and to what degree the insurance industry has been developing currently, and it also made policy recommendations which may promote the industry development.This article, according to the analysis frame of the insurance industry development, claims that effective supply is the internal driving force of insurance industry development, efficiency is the foundation of effective supply, risk control is the security of effective supply, and the benign interaction of these three factors is the key to the healthy development of insurance industry. By applying comprehensively social investigation, statistical data, financial ratio analysis, DEA and factor analysis, this article has an empirical study of the insurance supply and demand situation, the supply capability and technological efficiency of insurance industry, TFP, and the underwriting risk, investment risk and solvency risk of insurance industry on the 25 China-funded and foreign-funded life insurance or property insurance companies selected as samples. The findings show an obvious inadequacy of effective supply and a decreasing tendency in efficiency and a certain potential risk in solvency in the Chinese insurance industry. Overall, the development of the Chinese insurance industry is not satisfying in quality. A sustained development should be made by enhancing efficiency, controlling risks to increase effective supply.