A Study Of New Type Of Insurance Business Model Which Is Based On Retirement Community

As long as the population is getting aged, providing-for-the-aged problem emergesgradually. In the current stage of society restructuring and government function transforming,how to take care of the aged in new economic and social condition is a investigating worthytopic.This paper has analyzed the situation on demand and supply of services for the agedpeople. The first key is the demand and supply of money. Currently in China, there are threeforms of money supply for pensions, first is the basic social security, the second is enterpriseannuity, and the third is commercial endowment insurance. In the social macro level, we canfind that there is a big gap for the basic social security to get balanced, it can only secure someliving fundamentals for elder people. The enterprise annuity is a luxury for normal people,only those employees of a very good company can have it. To have a high quality of life afterretirement, the commercial endowment insurance is one of the best choices for supplement tobasic social security.In currently China’s economic structure, it’s pretty hard to maintain big structuralfamilies, families are getting smaller. The traditional mode of giving nursing care services byfamily members of young generations is hard to bring into practice now. There shall be someorganizations to provide such services in a central way in the society. The endowmentcommunity is one of the best choices.This paper has defined some of concepts related to setting up retirement community forthe aged people. By studying an exact foreign CCRC retirement community as sample, we canfind that those communities have common model: to enjoy the high quality of medial, cateringand health care services, the residents shall pay two parts of fees, one is the entrance fee,which is a big mount of money, and the other is monthly service fee. It’s really hard for themiddle income class to afford that. Meanwhile, the case study indicates that to investigate andrunning a retirement community, demands tremendous mount of money continually. This paper also has studied domestic cases. it’s found that they are all in some initial strugglingsituations, and the business models are still immature.This paper has designed and studied such a business model that the life insurancecompany to invest construct and run retirement communities, and provide caring aged serviceswith insurance products. The author has designed a product of living in retirement communityby financing with life insurance and long term care insurance in this paper. The retirementcommunity shall provide services including nursing care, health care and also the service shallcover aged psychology requirement, including inter-personal relationship, sense of belongingand self-realization.It’s quite convenient for the customers to such retirement community running in thisbusiness model, that a lot of immediate processes between the retirement community andinsurance company are cut. Combine with annual fee and long-term care insurance products,the insurance company provide good financing service for the customer, and extern the periodof financing. The customer can utilize the professional asset management team in insurancecompany to help to hedge against inflation and appreciation.It’s also discussed that what’s the meaning to a insurance company, in case of holdingsuch an asset like retirement community. Such a long term asset with fixed revenue likeretirement community, gives the insurance company a pretty good choice for it’s durationmatching for assets. If the insurance company pays the customer in terms of service instead ofcash, it will bring extra value to the insurance company since there will be some delay to carryout such a service, this delay will create value.The author is trying to give answer to how and why the insurance company shall invest,construct and operate a retirement community, and how it will help to promote the aged caringindustry ecosystem.It’s a big innovation of the ideas that let the insurance company to invest, construct andoperate a retirement community, it’s a win-win solution for both of the company and society.Retirement community will be a brand new way of living for the middle class in near future!...