Research On Credit Rating Of Chinese Listed Insurance Companies

With the business expansion of China’s insurance companies as well as the expansion of the scope of application of funds, the credit risk faced by the insurance companies have become increasingly complex. The lessons of international insurance giant AIG being taken over by the U.S. government also show that the listed insurance companies face the risk of use of insurance funds and the risk of corporate governance structure, which will have an enormous impact on the insurance company’s risk management and the country’s economy. Therefore, the credit risk rating of the listed insurance company will have a very important significance for the stability and development of Chinese insurance industry. At present, China’s domestic rating agency on credit rating of insurance companies are focusing on the qualitative factors, and the assessment methods are basically used the expert scoring method. In the assessment of the quantitative factors of the insurance company, we always measure the factors through the analysis of financial data. But the foreign rating agencies use a quantitative model to predict the credit risk of listed insurance companies, which has a great influence on the accuracy of the credit rating results.In this paper, we analyze the credit risk rating factors of listed insurance companies, then by contrast domestic and international rating agency’s rating methodology and the models, we analysis the applicable me methodology and the models for Chinese insurance companies. At the same time, we choose the KMV model to be used in the empirical analysis of listed insurance companies’credit rating, the results show that after a certain correction the KMV model can predict the credit risk of listed companies, and the prediction results are basically consistent with the domestic and international rating agencies’rating results. On the whole, the development of Chinese listed insurance company’s credit rating, not only need the continuous exploration for the model of rating methods and models, but also need to establish credit database of industry, strengthen the management of credit data.