China's Insurance Market Exit System

Perfect market exit system is an important indicator of the maturity of insurance market. Currently, China's insurance market exit system is not yet perfect; so far, there has been no insurance company exiting from the market. Insurance company's exit from market affects insurance industrial organization. Many problems in China's insurance industry are related to lack of perfect insurance market exit system. In this dissertation, the author studies the necessity of market exit and the building of market exit system from the viewpoint of optimization of industrial organization.In the second part, the author presents the basic concepts and basic theories of market exit. Through the analysis of the features of insurance industry, the author generalizes the characteristics of the barriers to insurance market exit, that is, policy barriers to market exit in insurance industry are high. The author analyzes the relations between market exit and optimization of insurance industrial organization, on this basis, the author depicts the optimal structure of insurance industrial organization under the condition of effectively functioning of perfect market exit system: differentiated oligopoly model, that is, large, medium-size and small companies coexist, relatively high market concentration, several large insurance groups or insurance conglomerates with international competitiveness; diversified developing modes, multi-level economies of scale; product differentiation; economic barriers to market entry fully play their part, policy barriers to market exit reducing, lower transition costs between different levels of economies of scale. Finally, the author defines the concept"insurance market exit system"and analyzes the contents of this concept.In the third part, through the empirical analysis of China's insurance industrial organization, the author finds out the major problems; and the root of these problems is the high market barriers and lack of perfect market exit system. Using market economy theories and theories of industrial organization, the author finds that market exit helps improve the efficiency of insurance market, optimize the structure of insurance industrial organization and solve the problem of structural imbalance between supply and demand in insurance market; on this basis, the author concludes that insurance market exit is necessary. Finally, the author points out that the essence of China's insurance market exit is adjustment and optimization of insurance industrial organization.The fourth part of this dissertation focuses on the building and improving of China's insurance market exit system. Through the analysis of the development of China's insurance industry, the author thinks that at this stage the objective of our government's intervention in insurance market exit should focus on maintaining stability; on this basis, the author points out the boundaries of government's intervention in insurance company's exit from market. By analyzing insurance guaranty fund system's strengths and weaknesses, learning from foreign countries'experience, the author puts forward proposals for China's insurance guaranty fund system.