| With the exceeding of globalization and the deepening of WTO progress, the financial market as well as the insurance market is opening wider and wider in China. Regarding the Chinese insurance market as their strategy development centers, almost all multinational financial groups have been entered Chinese insurance market and finished their strategy layout in financial business industries gradually. These multinational companies are conducting various financial business lines and holding sustainable competitive advantages with interactions among different financial business lines. Besides, some domestic companies in other industries such as domestic banks are also attracted by the good expectation in development of insurance industry and entered the industry. To win in the fierce competition, with the encouragement and guides from Chinese government and CIRC, domestic insurers are focusing on developing diversification operation mode. However, it is still unclear for domestic insurers whether and why they should introduce diversified or specified mode. To provide theoretical foundations and practical guidelines for domestic insurers in making decisions in this issue, this paper tried to solve problems such as what are advantages and disadvantages in diversified and specified operation, whether to operate in diversified or specified operation, what are effects by introducing those 2 different operation strategies.There was few literature and case in both theories and practical business in China because Chinese insurance industry had been developed only for a few years and, according to related Chinese regulations, legally, it was only permitted to conduct specified insurance business. However, since the 2nd half year of 2004, domestic insures have extended their operation from specified insurance business to other financial industries. Considering the emergency of this topic in practice and the rare of theoretic research, this dissertation chose to study diversified and specified operation of insurers, trying to get some achievements to be able to provide domestic insurers valuable suggestions in deciding whether to choose diversified or specified operation mode. It also tried to provide valuable results for Chinese insurers to develop themselves sustainable.This dissertation had 6 chapters:Chapter 1 introduced the topic, research meanings and approaches of this dissertation. It defined the topic of this research– the study on diversified and specified operation mode of Chinese insurers. This chapter reviewed, analyzed and compared concepts of diversified operation mode such as financial conglomerates, universal banking, parents banking, financial holdings after identifying the nature of relate concepts and made some summarizations.Chapter 2 summarized relate concepts and then reviewed the development of diversified and specified operation of international financial and insurance industry. It also reviewed literatures of researches in diversification. Besides, this chapter defined the research objectives and methods of this dissertation.Chapter 3 compared and analyzed advantages and disadvantages of 2 operation modes: diversification and specification. Firstly, it studied characteristics of diversification and specification with insurers'capital scale, source of income, profitability and organization structure in each category. By setting up a brand-new evaluation index system to evaluate the operation results of insurers, this chapter studied advantages and disadvantages of diversification and specification insurers with the empirical research way. 128 global insurers were divided into 2 categories: Diversification and Specification. By using the Statistical Package for the Social Science (SPSS), this chapter classified collected data and studied operation results of each category. Besides, this chapter also set up the diversified operation model and the specified operation model respectively after studying relationship between operation results and factors such as premium income, management fee, business structure and company scales. Furthermore, basing on qualitative analysis, this chapter got comparative advantages & disadvantages of diversified insurers and specified insurers respectively and presented suggestions in risk protection measures. Finally, this chapter made some conclusions in running insurance business with those 2 different operation modes.Chapter 4 studied"risks"and"effectiveness"of those 2 kinds of insurers. This chapter analyzed and compared risks and effectiveness during the process insurers transferring their operation mode from specification to diversification by risk-effectiveness and cost-benefit analysis. Secondly, it developed a cost function for insurers after dividing total costs into 3 categories, transaction cost, supervision cost, and internal management cost, to discuss cost variety when insurers transferring their operation mode. With the function, it studied conditions to be beneficial when an insurer transferring its operation mode from specification to diversification. Basing on supervision cost function and transaction cost function in different business portfolios, it introduced benefit functions of diversified insurers and presented the criteria strategy in deciding whether insurers should be transferred from specified operation to diversified operation.Chapter 5 reviewed the existing status and development of Chinese insurance industry. It showed that the existing Chinese insurers were employing specified operation mode and listed disadvantages of existing operation mode. This chapter indicated diversification would be the inevitable way for domestic large insurers. It analyzed the foundations and constraint conditions with the view of economic and legal environment. Finally, basing on research results in former chapters and existing status of insurance industry, this chapter presented views and suggestions for Chinese insurers in diversified operation.Chapter 6 summarized main conclusions of this dissertation and expectations for further research jobs.Main contributions of this dissertation are as follows:(1) This dissertation reviewed theoretic literatures in diversified and specified operation of international and domestic insurers systematically, analyzing and studying the practical development history in diversification and specification.(2)This dissertation set up a brand-new integrated evaluation index system and compared and evaluated operation effects of diversified and specified operation insurers respectively.(3)As a specialist in insurance industry, the author collected operation data of 128 insurers. After managing and analyzing the enormous data, this dissertation provided references for Chinese insurers to make strategy in diversifying.(4)With the empirical research method, by collecting enormous operation data of international and domestic companies, this dissertation set up mathematic models to study relationships between the operation effects and management expenses, business portfolio as well as the capital scale of diversified insurers and specified insures respectively.(5)This dissertation studied the variation of costs, benefits and risks when insurers changing their operation mode from specified to diversified.
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