Use Of Funds And Risk Control Of The China People's Insurance Holding Company

With China's entry into WTO, foreign-funded insurance companies are more willing and confident to participate into the potential market of China with large scale. Recent years, with more competitors enter into the market, the ratio of premium revenue of PICC-controlled Company (hereinafter PICC) to that of the whole industry gradually decreased. Furthermore more intensive competition decreases the profit level, which means PICC is faced with serious challenge. Therefore, PICC should break through the old operation pattern and strengthen the utilization of capital to increase the utility and ability of utilizing capital, by which the shortage of the traditional businesses can be compensated by the return from capital utilization and the new origin of profit is cultivated.This article introduces the development history of foreign insurance companies using capital and tries to enlighten the development for the Chinese insurance companies. It aims at finding the shortage and disadvantageous factors existing in the market competition and capital utilization for Chinese insurance companies and designs the risk control model for PICC. The new model of insurance capital management and how to emphasize the control of utilization ratio are put forward. In the research process, the capital-asset model of price-fix is used to find the optimal portfolio. On the basis of the fact of PICC, the corresponding conditions and counter-measures and the new idea of using insurance capita are also raised. It is pointed out that it is necessary to analyze related policies and cultivate multiple talents. Through analysis, it is concluded that PICC should focus on the research of how to take the advantage of insurance capital and increase the relative ability. Meanwhile, the risk-control mechanism should be established to decrease the risk the utilization of insurance capital and strengthen the study oncorresponding policies.