An Empirical Study On The Influencing Factors Of Auto Insurance Loss Ratio Of Property Insurance Companies In China Under The Reform Of Auto Insurance Rates

With the increasing income and consumption level of Chinese people,automobiles have increasingly become an important tool for Chinese people’s daily life.The rapid development of the auto market has promoted the vigorous development of the auto insurance industry,but in the growing auto insurance market,there have always been problems such as high premiums,high loss ratios,and low underwriting profit margins.A series of policy documents were issued and the market-oriented reform of commercial auto insurance rates was gradually implemented nationwide.However,with the deepening of the reform of auto insurance rates,the problem of the rising auto insurance loss rate has not been well resolved.By studying the influencing factors of auto insurance loss ratio,this paper analyzes the relationship between these factors and the compensation ratio under the background of auto insurance rates reform and puts forward corresponding suggestions for the optimization of auto insurance compensation ratio.This paper first analyzes the current situation of the auto insurance market.Then selects the risk factors that will affect the auto insurance claim rate according to previous research and qualitatively analyzes the impact of each factor on the auto insurance claim rate from two aspects of the auto insurance rate reform factors and the non-auto rate insurance reform factors.In the empirical research,the article selects the data of property insurance companies from 2011 to 2019 in 36 provinces and cities across the country(including cities under separate state planning),and constructs a 9-period balanced panel.The system GMM model is used to test the robustness,and then the sample is divided into two categories: large property and casualty insurance companies and small and medium-sized property and casualty insurance companies for heterogeneity analysis.The research results show that the auto insurance rate reform will lead to an increase in the auto insurance loss rate.Under the background of the market-oriented reform of auto insurance rates,the negative effect of auto insurance business proportion and premium income on auto insurance loss rate is more obvious,but the positive impact of indemnity per case on the auto insurance loss rate has weakened.Through the heterogeneity analysis,it is found that the proportion of auto insurance business has a positive impact on the auto insurance loss rate of large property insurance companies,but it has a positive impact on small and medium-sized property insurance companies.Optimizing the loss ratio of auto insurance requires the cooperation between regulators and insurance companies.This paper provides specific countermeasures and suggestions for regulators and insurance companies.Regulators should provide policy support for small and medium-sized property and casualty insurance companies,promote the implementation of comprehensive reform of auto insurance and improve market access and exit mechanisms.Insurance companies need to further optimize the business structure of property and casualty insurance,improve risk management mechanisms,and continuously innovate auto insurance products design and expand sales channels.