Research On China's Car Insurance Market Reform

Auto insurance has a pivotal position in the property insurance industry. Auto insurance coverage continues to expand, with capacity to enhance risk gradually, for example, in the maintenance of road traffic safety, service, for which social and economic development has played an irreplaceable important role. As an important pillar of China's property insurance industry, auto insurance business developed in a bigger and stronger manner than the non-life insurance industry. China's property insurance regulatory work has been the center of the insurance company to run the core competitiveness of auto insurance, and thus has promoted the healthy and rapid development of auto insurance market. In recent years, compared with the foreign auto insurance industry, China's auto insurance industry has room for further improvement, as its development speed can not meet our country's current need. And with the deepening of the domestic insurance market reform and the development of the domestic insurance market, and the financial liberalization, insurance market internationalization and economic globalization trend, in April 2000, the China Insurance Regulatory Commission decided to implement market-oriented reforms in the country, which is the reform of the management system and auto insurance terms. Afterwards, the insurance company has the right for pricing auto insurance products as well as independent product development. Against the system implementation, how to further promote and deepen the reform of auto insurance market, how to solve the problems in the present situation of China's market oriented reform, are among the important issues in our country's insurance industry.This paper takes China auto insurance market reform as its line of research, on theoretical basis of microeconomic theory, the theory of internal control, corporate governance theory and so on. Drawing on the relevant auto insurance market reforms of the United States, Germany and France,it explores about the auto insurance market reforms in China.It first analyzes the current situation of China auto insurance market reform and finds out what are the problems. The problems include that imperfect corporate governance structure, lack of the internal control mechanisms effectiveness, weak data accumulation and management ability, weak regulatory capacity of Insurance Supervisor Bureau and among others. These problems are hindrances blocking the development of China's insurance industry and need to be solved. In conclusion, counter-measures on how to deepen the auto insurance market reform are proposed,1) strengthen governance structural innovation, enhance self-discipline of market players, strengthen internal control construction to promote the ability of risk prevention, enhance data accumulation and establish insurance industry database as soon as possible, improve the auto insurance market information disclosure mechanism and so on. Only through further reform can these problems in the long-standing insurance market be solved, and the legitimate rights and interests of the insurer and the insured can be better protected so as to ensure promote the auto insurance market's transformation and upgrading and its long-run sustainable and healthy development.