1, opportunity.
First of all, the entry of foreign insurance companies into China market will increase the supply of insurance funds, thus improving the position of financial and insurance industry in the whole national economic structure. Secondly, the entry of foreign trade insurance companies will inevitably bring strong external pressure to China's insurance industry, forcing China's national insurance industry to embark on the road of restructuring and re-improvement, and constantly developing and perfecting its market structure, organizational elements, intermediary system, management, etc., so as to urge and guide China's insurance industry to move towards high-level business objectives and realize the upgrading of China's insurance industry; At the same time, the advanced business philosophy, professional technology, management experience, high-quality products and after-sales service of foreign-funded companies will have a good demonstration and enlightenment for domestic counterparts. Thirdly, opening up will enable a large number of insurance practitioners to get training and exercise opportunities, thus improving the overall quality of China's national insurance practitioners. Competition and publicity among all kinds of insurance personnel will also instill insurance knowledge and ideas into the general public to a certain extent, thus improving people's insurance awareness and promoting the development of China's insurance industry. Finally, it creates convenient conditions for China insurance companies to go abroad and display their talents in international market information.
2. challenges.
First of all, the entry of foreign insurance companies has strengthened the degree of competition in the insurance market, leading to a rapid decline in the premium profit rate of insurance companies. Secondly, it caused a part of the premium outflow. Judging from the operation of some foreign insurance companies that have entered the insurance market in China, the premium income has increased steadily in recent years, but before 1997, there was a book profit. The main reason is that the retained premium is relatively small, and some premiums flow out of the country through reinsurance channels. The expense cost is high, so the underwriting profit is low. Although Article 102 of the Insurance Law, which was implemented in 1995, stipulates that "if an insurance company needs to handle reinsurance ceding business, it should give priority to insurance companies in China", it is quite difficult in actual operation. At present, the insurance regulatory authorities require foreign-funded insurance companies to maintain a premium of not less than 30%. Under the statutory reinsurance of 20%, 50% of the premium can still be reinsurance by foreign-funded insurance companies. Thirdly, compete with domestic insurance companies for a certain market share. Objectively speaking, foreign insurance companies have the advantages of strong financial strength, advanced management and high technical service level. At present, although their business scope is still limited, their development momentum is still relatively good. From the perspective of the national market structure, the proportion of foreign insurance companies is less than 1% in, but the market share of foreign insurance companies in open areas is close to 10%, and there is a tendency to continue to expand. In addition, foreign insurance companies have more favorable conditions than domestic insurance companies in terms of treatment, which will lead to the brain drain of some outstanding talents of domestic insurance companies.
3. Possibility of further opening of the insurance market.
(1) China's insurance market still has great development potential and there is room for further opening up. The overall development level of China's insurance industry is still relatively low. From the insurance density (per capita premium expenditure) and insurance depth (the proportion of premium income to GDP), we can see that China's national insurance industry is in the initial stage of development. According to statistics, the general insurance depth in developing countries is 4%, and the per capita premium is generally more than 200 dollars, while that in developed countries such as the United States is 9%, while the current insurance depth in China is only 1.486%, and the per capita premium is 1.08 dollars. On the one hand, these data illustrate the backward situation of China's insurance industry, on the other hand, they also illustrate the huge development potential of this industry in China.
(2) China's national insurance industry has already possessed powerful competition and management means, and gradually started to connect with the international market. First of all, from the perspective of the strength of insurance companies, China Insurance Group, China Pacific Insurance Company and China Ping An Insurance Company have all developed into national large-scale insurance group companies. According to statistics, among the national 1997 premium income, China Insurance Group accounts for 69.2%, Ping An Insurance Company accounts for 15.8%, and Pacific Ocean accounts for 1 1.9%. These three companies also have a certain reputation in the insurance industry. Take China Insurance Group as an example. 1996 After completing the necessary reorganization of production and living separately, the registered capital reached 20 billion yuan, with 6,000 branches in China, 1997, and the life insurance premium income was 76.9 billion yuan. According to the annual statistics of Standard & Poor's Company on the ranking of the world's largest insurance companies by net premium income, China Insurance Group ranks 17. This shows that insurance companies in China already have the strength to compete with foreign capital. Secondly, the basic practice of China's insurance industry is to operate in accordance with international practice step by step.
3. Problems in the opening of insurance industry in China.
(1) The insurance market structure is unbalanced. The development of China's insurance market is unbalanced, with social insurance lagging behind commercial insurance, personal insurance lagging behind property insurance, reinsurance lagging behind direct insurance and international business lagging behind domestic business. First of all, from the overall situation of China's insurance industry, the development of China's life insurance market is lower than the overall development level of China's insurance industry. For example, in China194, the premium income was 63 billion yuan, of which life insurance income accounted for 3 1.5%. According to the research report of World Statistics 1994 published by Sigma magazine, a Swiss reinsurance company, in 69 countries and regions where the fee income exceeds 1 billion dollars, the per capita life insurance premium (i.e. life insurance density) is 320 dollars, while China's life insurance density is only 2 dollars, ranking 66th among 69 countries. The average life insurance depth of these 69 countries is 2.07%, while that of China is only 0.2%, which is not only lower than the world average, but also lower than the overall level of insurance industry in China, and even far behind some developing countries. However, in order to open the China market, foreign insurance companies first aim at the life insurance market in China, and most of the application materials submitted to the People's Bank of China (CIRC) require life insurance business. Therefore, with the further opening of China's insurance market, foreign life insurance companies will have a great impact on China's national insurance industry after entering China's life insurance market. Secondly, the reinsurance market has not been fully developed. Reinsurance is an important means for insurance companies to disperse and control risk responsibilities, increase underwriting power and expand business capabilities. A perfect insurance market is inseparable from reinsurance, and the reinsurance cost and market capacity also restrict the development of the insurance market. However, China's insurance industry has not yet established a truly perfect market-oriented reinsurance system. Therefore, the development of China's national insurance industry is not optimistic in terms of total volume and structure. (2) The premium rate is not reasonable enough. First of all, the overall premium level is high. Secondly, there are fundamental defects in the mechanism of premium determination and adjustment. At present, the adjustment of insurance premium rate in China is not based on the change of market supply and demand, and only limited changes can be made according to the unified premium rate stipulated by PICC approved by the People's Bank of China. Moreover, regardless of regional differences, the insurance premium rate is unified throughout the country. Therefore, the formation and adjustment mechanism of this rate not only failed to play a leverage role in regulating the market and promoting the healthy development of the market, but also prompted enterprises to engage in unhealthy market competition in the form of unreasonable commissions and kickbacks, disrupting the benign development of the market order.
(3) The scope and ways of using insurance funds are subject to various restrictions. China's financial management department only allows insurance funds to invest in government bonds, bank deposits, financial bonds and restrict market access. Although this kind of capital investment ensures the security of the fund to a certain extent, the return rate of these investments is low, which makes it difficult to ensure the appreciation of insurance funds, and also leads to their passive depreciation in the high-speed inflation. Anglo-American insurance funds mainly invest in companies' stocks, bonds, mortgages, loans, government bonds, real estate investments and other projects, ensuring that the funds can continuously increase their value in high-yield investments. This kind of unequal operating conditions has led to more freedom for foreign insurance companies that are already in an advantageous position, and they can attract customers. This unfair competition will further disadvantage the national insurance industry in the domestic insurance market competition.
(4) The total reserves are not scientific enough. China's total reserve is extracted from the after-tax profits of enterprises, which makes the accumulation of total reserve start from a low point and slow. If the company loses money in some years, the number of deposits in these years will be negative. Therefore, the current general reserve withdrawal method in China has increased the operational risk of China's insurance industry.
(5) The insurance tax rate structure is seriously unbalanced. Insurance tax rate structure can be divided into insurance subject tax rate structure and insurance type tax rate structure. The structure of insurance tax rate can be divided into one type of insurance: from the name, the tax level of China's insurance industry is higher than that of similar industries in other countries in the world. In all countries of the world, the insurance industry is generally treated differently from other industries and adopts relatively loose tax policies to support its development. For example, the income tax rate of American enterprises is 24%, and the tax rate of Canada is 15% ~ 30%, and progressive tax rates are implemented according to different scales. However, the income tax rate of the insurance industry in China, such as PICC, is as high as 55%. The second performance: the tax revenue of domestic insurance companies is not uniform. At present, PICC pays 55% income tax, while Pacific Insurance Company pays 33%. Ping An Insurance Company established in Shenzhen only enjoys the tax preference of 15% in the special zone. This unfair tax makes all enterprises stand on different starting lines, resulting in unfair competition conditions. Performance 3: "The tax revenue of domestic and foreign-funded enterprises is not uniform. At present, foreign insurance companies enjoy the preferential tax rate of 15% in China, while domestic enterprises have to pay the income tax of 55% or 33% (of course, a few companies in the special zone enjoy the income tax of 15%), which has caused a huge difference in retained profits between domestic insurance companies and foreign insurance companies. The tax rate structure of insurance refers to setting different tax rates for different types of insurance, which is also a common practice in the international insurance industry and reflects the objective requirements of different risks and different risk transfer costs. According to statisticsNo. 1 andNo. 1994 of Sigma, a Swiss reinsurance company, the fire risk tax rate is 7% in the Netherlands, 17% in Italy and 30% in France, the highest, while only five countries have foreign insurance exceeding 10%. Judging from the current situation in China, not only the overall tax rate of insurance is higher than that of other countries, but also different types of insurance have no tax rate, which is rare in the world. From this point of view, the unreasonable insurance tax rate structure will seriously weaken the competitiveness of China's national insurance industry in the liberalized environment.
(6) The supervision of foreign insurance companies is weak. Due to the short-term establishment of the CIRC, the management level is backward to a certain extent and the management personnel are lacking, which leads to the phenomenon of emphasizing examination and approval and neglecting management. Due to the lack of supervision, illegal and unfair competition behaviors of foreign insurance companies in China insurance market continue to occur. Third, the opening of China's insurance market.
1. Accelerate the cultivation and improvement of the domestic insurance market system.
① Pay attention to the construction of insurance institutions. First, give priority to the development of Chinese-funded insurance institutions and strictly examine and approve foreign-funded insurance institutions, which is the need to protect the national insurance industry; The second is to give priority to the development of life insurance institutions.
② Establish and standardize the insurance intermediary system. At present, the insurance intermediary market in China will be dominated by insurance agents, and insurance brokers will be
Auxiliary. In the organizational form of agents, full-time agents are mainly developed, supplemented by part-time agents. In life insurance business, especially in personal life insurance business, agent is the main form of expression. In addition, we will also develop some intermediaries specializing in insurance assessment, inspection and actuarial services, bring the construction and management of insurance intermediary system into the legal track, strictly implement the qualification certification system and issue certificates. ③ Establish and improve the reinsurance market, and eliminate the risk transfer obstacles in developing direct insurance business. According to China's national conditions and the experience of Hong Kong, Japan and Germany, China should give priority to opening the reinsurance market and reasonably protect the direct insurance market when formulating insurance policies. This is not only in line with the opening requirements of China's accession to the World Trade Organization, but also conducive to the protection and promotion of China's insurance industry. We can consider setting up a national reinsurance company as soon as possible to undertake statutory reinsurance business; Establish a reinsurance group in which all Chinese-funded insurance companies participate; Set up other joint-stock insurance companies in a planned and selective way; We have the conditions to introduce foreign reinsurance companies and reinsurance brokerage companies, and gradually establish our own reinsurance brokerage companies to increase domestic reinsurance capacity. Gradually establish and improve the reinsurance market system that matches the direct insurance market, and escort the development of the entire insurance industry and even the national economy. At present, China Reinsurance Company was established in March 1999, and the market reinsurance system has been initially started.
2. Optimize the internal environment and improve their competitiveness.
(1) Strengthen personnel training, attach importance to the use of talents, and establish an effective incentive and restraint mechanism.
(2) Increase investment in science and technology, improve equipment grade, and realize electronic networking and office automation as soon as possible.
(3) We should strengthen insurance accounting and constantly develop efficient insurance products that meet market demand.
3. Optimize the external environment and achieve fair competition.
(1) Cancel the preferential tax rate of 15% for foreign-funded insurance companies as soon as possible, so as to make the tax revenue of domestic and foreign-funded enterprises equal.
(2) generally reduce the tax level of domestic insurance industry.
(3) Differentiate different types of insurance and set different tax rates, reflecting the principle of risk-return comparison.
(4) Adjust the investment channels of insurance funds. It is suggested that life insurance companies should be treated differently, and the investment scope of life insurance companies should be relaxed in a planned and step-by-step manner, so as to expand the investment portfolio, reduce risks and improve value-added ability.
4. Establish and improve the relevant laws and regulations system of insurance enterprises.
In addition to the existing Insurance Law as the basic law, we should also formulate the Insurance Contract Law, the Regulations on the Management of Insurance Intermediaries, the Reinsurance Regulations and the relevant management regulations of foreign-funded insurance enterprises as soon as possible, so as to make them a perfect insurance legal system and enable China's insurance industry to operate according to law, thus putting an end to all kinds of irregularities in insurance business activities.
5. Insurance administrative supervision and industry self-discipline.
It is necessary to shape China's insurance supervision system according to the management mechanism of government supervision and self-discipline of trade associations. The government's supervision will be stricter and more standardized, and the government's insurance regulatory agencies will mainly supervise the market from a macro perspective, such as the development planning of the insurance industry, the examination and approval of institutions, the limitation of the market, the use of funds and so on. In terms of government supervision, regulators should minimize administrative intervention, enhance regulatory transparency, and rationally allocate resources by market means. (1) Break the existing supervision system, change from administrative supervision to economic supervision, set up supervision institutions with different personnel sizes according to the insurance density and insurance institutions in different regions, extend the tentacles of insurance supervision, expand the coverage of insurance supervision network, keep abreast of the market trends of various insurance entities and judge their business behaviors. (2) Implement unified supervision over domestic and foreign insurance companies, and try to avoid inconsistent supervision indicators and means, resulting in double supervision standards. (3) gradually abolish the control of insurance rates, so that the price of insurance commodities can give full play to the role of market regulation and achieve a balance between supply and demand. Trade associations are self-regulatory organizations in the insurance industry, which mainly regulate the micro-foundation of the market, namely, the standard of rate change, the technical protection and revision of insurance products, the regulation of competition behavior among members, cooperation and exchanges between companies and other market behaviors of enterprises. This two-in-one mechanism can make government supervision and enterprise self-discipline perform their respective duties, which not only reduces the supervision cost but also improves the supervision efficiency.