Research On China’s Insurance Regulatory Environment

Insurance regulation environment is a new topic. This is where the value of the present thesis lies. Practical situation analysis has been given sufficient importance in China since ancient times.Insurance regulation and regulatory environment is closely related. Insurance regulation environment has an asymmetrical feature and this is the key rationale of the current thesis and also the precondition and basis for regulation to make adjustment in the environment.Evidence of the relation between insurance regulation and environment can be found in the insurance regulation practice in the past years.Impacts of the external environment on insurance regulation can be found in the opening-up process of China’s insurance industry, for the process itself is a constant adjustment process of China’s insurance regulation to adapt itself to the external environment.In this sense, China’s opening-up policy drove the domestic insurance industry to improve and grow.Influences of the internal environment on insurance regulation is reflected in the No.70document issued by CIRC in2008, which aims to strengthen regulation on China’s P&C market and is an active effort CIRC made to adjust regulation measures under the influence of the internal environment. After a series of disciplinary efforts, the environment of P&C market was greatly improved, which in turn enhanced the profitability capacity of all the insurers.In2009, P&C market achieved break-even; in2010, profitability level saw further significant improvement.Now the regulation environment demonstrates an increasingly complex feature. The present thesis aims to build an insurance regulation environment system and elaborates the components of insurance regulation environment and their respective weight and influences and the adjustment of regulation environment and optimization solutions, hence bearing significant theoretical and pragmatic meanings. The theoretical meaning of the current thesis lies in that it is the first systematic meditation on the Chinese insurance regulation environment and contains innovative concepts.The pragmatic meaning of the current thesis is that through a systematic research on insurance regulation environment, it presents a clearer way to understand the interaction between insurance regulation and environment, regulation environment adaptation and optimization measures. Meanwhile, it makes analysis on the influences of environment on regulation based on the Chinese insurance regulation practices.To be more specific, the current thesis elaborates the asymmetrical features of insurance regulation, explains different components of regulation environment and the correlation between environment and regulation, and maintains that external and internal components weigh differently in different times and the realization of it is conducive to enhance the rationality and accuracy of decision-making.The rationale of the current thesis is as follows:First it defines relevant concepts and claims that regulation environment is asymmetrical and can be classified into external and internal factors; then it analyzes the co-relation between regulation environment and regulation and concludes that in growing period external environment factors weigh higher on regulation; also analyzed are the adaptability models of insurance regulation on environment; finally it makes comparative analysis on international practices and recommends specific optimization measures for China’s insurance regulation environment.The main contents of the thesis are outlined as follows:The introductory part explains the background and significance of the topic, summarizes literature review, analyzes the rationale and methodology and identifies innovative highlights and inadequacies.The first part introduces the research background and its expected value, defines the key terms, and summarizes the research approach and methodology, its innovative contribution and recommendation for future work. Section one defines and analyzes insurance regulation environment and related theories. Section two analyzes the external environment of insurance regulation. Section three analyzes the internal environment of insurance regulation. Section Four explains the weights of different components. Sections Five introduces the adaptability of insurance regulation environment. Section six expounds on the optimization of insurance regulation environment.In terms of research methods, the present thesis adopted and combined the following ones:macro and micro analysis, static and dynamic analysis, qualitative and quantitative analysis, and made conclusion with arguments from history and comparison.The main innovative contributions of the thesis are enumerated as follows:First, it is an innovative discussion on insurance regulation, the first attempt made on systematic research on insurance regulation environment theory and practice.Secondly, it is the first systematic construction of insurance regulation environment model and makes detailed analysis on the relation between regulation environment and insurance regulation.Thirdly, it proposes that in different times, external and internal environment weighs different on insurance regulation decision-making.In addition, the current thesis provides useful suggestions and references for insurance regulation practice. It points out that insurance regulation environment is complicated and dynamic it is hardly possible for one governmental department or one business to bring about positive changes. We need to strengthen top-level regulation design to lay a solid foundation for the current insurance regulation and future development. The thesis also claims that the major problem in the current insurance regulation environment is inadaptability, and to solve this problem it is highly necessary to strengthen the adaptability of industry environment for macro environment. The thesis put insurance regulation environment under the background of the current domestic social-economical transformation and emphasized the importance of giving consideration to local conditions and alarmed that it is more reasonable to learn from the western experiences than to copy them. The inadequacies of the thesis are mainly reflected as follows:First, the lack of historical data leads to an insufficient analysis. If there were adequate data the influences of environment on policies can be more forcefully answered. Secondly, the current research is conducted on only the main influencing factors of the insurance regulation environment. However, there can be infinite number and categories of influencing factors, the identification and analysis of which can never be sufficient in one single research project. Meanwhile, the examination and assessment of insurance regulation environment are easily influenced by subjective judgments. The present thesis tries to keep objective and sort out the influencing factors against the underlying insurance regulation rules. Moreover, insurance industry as an open system is always interactive with the surrounding environment, which may results in various changes in industrial operation, development and output and in turn leads to changes of the influencing factors.