Research On Financial Risk Evaluation And Control Of H Insurance Company

With the prosperous development of China’s financial market,the insurance industry has been growing more strongly in recent years,but compared with some countries with leading economic development levels,China’s insurance market started relatively late and there is a considerable gap.Through continuous promotion and development in recent years,insurance companies have launched a series of new products under continuous innovation,and the market demand is growing rapidly,and the relationship between the public and insurance has become closer.In the increasingly competitive international insurance market environment,the risk factors affecting the insurance industry are also changing.Because the insurance industry is different from other traditional industries,it has the characteristics of taking risks,and because of the special nature of its business,it has a high debt ratio,so the financial risks are more prominent.As a domestic insurance company with a large scale of operation and a wide range of influence,H insurance company also has some financial risks in the process of development.Therefore,the establishment of a scientific and reasonable financial risk evaluation system and timely analysis of potential risks within the company can effectively help the company’s management to understand the company’s financial situation dynamically and formulate effective risk control measures,which is of key significance to promote the healthy and sound development of the insurance company.Based on the literature on financial risk at home and abroad,this paper selects life insurance company H insurance company as the research object,starting from the theory of financial risk,characteristics and classification of financial risk of insurance companies and the financial situation of the company,and based on the annual reports of H insurance company from 2017 to 2021 and relevant financial indicators,the company’s financial risk is identified from four aspects: debt service risk,operational risk,profitability risk and development risk.The company’s financial risks were identified in four aspects: debt service risk,operational risk,profitability risk and development risk.The entropy value method was used to establish weight coefficients for the financial risk evaluation index system of H insurance company,and the evaluation model indexes were determined through correlation analysis.From the evaluation results,it can be seen that the overall financial risk of H insurance company is in the dangerous medium risk area and there is a tendency of increasing risk,which should attract the attention of managers.Finally,based on the evaluation results of H insurance company’s financial risks,we propose targeted suggestions such as building a reasonable capital structure,strengthening the management of underwriting,optimizing the budget and improving the innovation ability.The research in this paper can help H Insurance Company to understand its financial risks comprehensively and accurately and formulate corresponding prevention strategies,as well as provide certain reference significance for similar enterprises in evaluating and preventing their own risks.