Research On The Shift In The Control Of Insurance Company Client -resources

As the market for private insurance develops and increases in China, and the market becoming ever more competitive, the traditional method of insurance companies’ development is facing its greatest challenge. How to adapt to the intense competition, while continuing the stable, steady, and healthy development of the insurance industry should be the number one concern for the industry. Thus, knowing the information of actual clients, and change from the passivity in the sales of insurance are the only ways to ensure the steady development of insurance companies. Fight for the control over the client market is now the primary concern of all insurance companies, and only by having this control can it allow for a long and steady development of insurance companies.China Pingan Property Insurance Ltd. Company (Pingan Ltd.), being a part of the Fortune 500, constantly changes its management strategies to avoid being outdated, and looks for the best tactics in its development through the intense market competition. This article seeks to explain how Pingan Ltd.’s tactics that led to malicious competition between the insurance companies, which resulted in the various companies investing huge amounts into marketing, thus leading to high costs in marketing, high loss ratio, and low renewal rate that forced insurance companies into deficit throughout many years. The article will, through explaining the development of Pingan Ltd, combined with data from Pingan Ltd. in Shaanxi province, with data analysis on the shift of control on the client market in two steps. The first being agent-dominated market, and followed by a sharing of the client market between the agents and the company itself. The subjects of the study are the company and the agents. The analysis concludes that the main factor for that affect the control over client market that use agent as the main step is market resources. In this step the company owns technological, cultural, and human resources, but lack market resources, In contrast, the agents have market and human resources; thus the control over client market is in the hands of the agents. After the development of direct sales from insurance companies, the companies themselves begin to gain an amount of client market, and the control shifts from the agents to the companies. This is caused by the investment made by the company due to having more novel cultural resources and higher credibility in the brand name, while the agents do not, leading to a loss of market control. From this we can see that the true factor of this shift are strengthening and enriching cultural resources. The credibility and trust in the brand Pingan increases, ensuring the proliferation and smooth progression of direct sales, success in obtaining a portion of the client market, and gradually breaks away from the need of agents to expand business, to help the business step away from malicious competitions.