China life insurance three channels

Insurance is not a monopoly, but it is growing fast.

1)Advancement of insurance reform. Since the second half of 2003 China Property and Casualty Insurance Company Limited, China Life Insurance Company Limited and Ping An Group Company Limited, have been listed abroad. The supervision of international investors has been gradually transformed into the conscious action of listed companies, and the business volume of the three major insurance groups together accounts for more than 60% of China's insurance market. The vigor bursting out from the reform is becoming a powerful driving force to promote the healthy and rapid development of China's insurance industry. The third structural adjustment has begun to bear fruit, the structure of life insurance products has been improved, the growth of new business is faster, the gradual transformation of bank insurance products, the accelerated development of risk protection products, and the quality of business has been improved. The various degrees of the property insurance market have declined considerably. The proportion of premiums accounted for by the former large companies has declined significantly since 2003, i.e. the market has become more competitive. The use of funds and investment structure of insurance companies has improved. Because in the investment structure of insurance companies, bank deposits used to account for a relatively large proportion of bank deposits in 2003, the proportion of bank deposits has declined, the bank stimulus bonds and convertible bonds have become a new investment highlights of the insurance industry.

2)Policy measures to promote development have made new breakthroughs. First, the insurance market access mechanism has been improved, and new market players have been created one after another. Previously, it was not easy to set up a new domestic insurance company, and there were basically no approvals for new Chinese-funded insurance companies for many years, but a number of new insurance companies were approved for preparatory work in 2004, including the approval of the establishment of the first agricultural insurance company, the first professional company for construction insurance, and the first pension insurance company, which made new breakthroughs in the specialization of insurance companies in terms of economic and organizational forms of innovation.2003 Eight Chinese-funded insurance companies and four foreign-funded insurance companies entered the market to conduct business. At the same time, a number of branches of insurance companies have been established to promote competition in the market. Secondly, the channels for the utilization of insurance funds have been continuously broadened. In addition to trading government bonds and financial bonds with bank deposits as stipulated in the Insurance Law, in 2004, insurance companies were allowed to buy and sell corporate bonds, invest in securities investment funds and invest directly in the stock market. Insurance companies are allowed to utilize their own foreign exchange funds abroad, and are allowed to invest in bank stimulus bonds and convertible corporate bonds. Insurance companies are also allowed to make agreement deposits with commercial banks. The broadening of insurance fund utilization channels has created conditions for insurance companies to strengthen asset-liability matching management, diversify investment risks and improve investment returns. Thirdly, the financing channels for insurance companies have increased, allowing insurance companies to issue stimulus bonds, which provides a new way to solve the pressure of capital increase and improve solvency in the rapid development of the insurance industry.

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