The Empirical Analysis Of Efficiency Of Chinese Insurance Industry

The insurance industry has developed rapidly in China recently, and there is great improvement in the reform of the insurance system. However the insurance industry is still in the plight for the absence of the competition, and the lower efficiency and profitability. From 2006, foreign insurance companies will have the citizen treatment. The challenge following participating in the WTO is approaching, and the domestic insurance companies will be threatened in many respects. How to reform the domestic insurance companies, especially the state insurance companies, and how to increase their efficiency have become an urgent and important problem.This paper has introduced the SCP analysis model in the industry organization theory, and made a judgment in the market structure of the Chinese insurance industry. Furthermore on the basis of the explanation for the characters of the insurance market structure, the paper has researched the relationship between the domestic insurance market structure, the market behavior and the performance by the means of the equilibrium analysis. Under the instructions of the theory analysis, we use the DEA method to calculate the efficiency scores of the insurance companies according to the available data and materials. We have reached a conclusion that the efficiency of the insurance companies is low in our country. Finally we confirm the main decisive factors using the Tobit regression method, and make some suggestions according to them so as to promote the increase in the insurance industry efficiency.