Legal Analysis Of The Expansion Of Liability Insurance

History of liability insurance can be said to be history of expansion. Object of insurancetypes are increasing, new type of insurances are emerging and payment levels are rising.However, liability insurance encounter with all kinds of problems and doubts during itsexpansion process. From legal perspective, this paper explains theoretical interpretation ofliability insurance, try to solve these problems and confusion. The following article is dividedinto five parts:The first chapter: the objective needs and limits of liability insurance expansion. Thischapter starts from the relationship between legal responsibility and liability insurance. First,as the basis of liability insurance’s initial generation and development, tort liability insuranceis still a major field of liability insurance expansion. Tort law and liability insurance areimportant pillars of development for each other. But in the1980s liability insurance crisis inthe United States indicated that excessive expansion of tort liability insurance crisis couldtrigger liability insurance crisis, future liability insurance had demand space for intentionaltort liability responsibility, mental damages responsibility, joint tort liability responsibilityand punitive compensation responsibility. Secondly, the practice of natural disasters publicliability insurance in recent years indicate that objects of liability insurance has begun tobreak through the limitation of civil liability, non-civil liability as represented by country aidresponsibilities has expansion needs also. Finally, contractual liability insurance does nothave expansion needs.The second chapter: the ethical basis of liability insurance expansion. This chapterfocuses on the relationship between social morality and liability insurance. First, the result ofquestionnaire indicate that liability insurance expansion in our country is facing ethicaldilemmas such as congenital absence of the traditional culture of insurance, acquired andirrational insurance industry, liability insurance encourage illegal issue. Secondly, throughcase study by U.S. Breeden case, USA K. W. Case, the U.S. firearms liability compulsoryinsurance proposal as well as "Interpretation of the applicable law of Supreme Court for someissues about compensate for road traffic accident damages" from our country, we found thatalthough faced with ethical censure, but liability insurance can break through successfully,and achieve the expansion about negligent tort behavior, criminal behavior, drunk driving behavior. Finally, because of rational understanding of the public to liability insurance isgradually formed, liability insurance has been able to escape from suspicion of moral hazardfor many times. The new liability insurance ethics, including the transform from protectinfringers to victims, the distinction between malignant behavior and insurance products, thedistinction between public law and private law punishment, the distinction between willfuland intentional result and so on.The third chapter: business technical support for liability insurance expansion, mainlyon the relationship between the level of liability insurance development and liability insurancemarket management. Analysis from research and related news, this paper has found thelimitation during liability insurance expansion, include liability insurance product is hard todevelop and promote, operating losses. In fact, foreign liability insurance market has similarproblem also. However, by technical improvements of insurance business, these problemshave been solved already. The technical improvements represent by terms optimization andinsurance companies operating risks controlling. For the former, the experiences of modifyAmerican CGI insurance policy for dozen times are worth to pay close attention. When theterms of the contract are modified, it should fit the actual needs of the insured party and theinsurer party while ensure their operation safety. In respect of operational risk managementand controlling, include reinsurance, insurance securitization, insurance investment andprofessional self-insurance.The fourth chapter is about policy support of the compulsory insurance expansion,including the relationship between the level of the insurance market and government support.First of all, government policy can help to solve the problem, market failure, efficiently,which for insurance company is hard and difficult to do. In China, the policy supporting theexpansion of compulsory insurance also did not work well, which typically showedcompulsory insurance policy are difficult to performance, and kinds of compulsory insuranceproducts are few. Second, from the practice of compulsory insurance, the defects of thesystem include sustained large losses, refuse to sale insurance of car models in the high risk,and low-level of insurance compensation. The direct reason of these defects is theunscientific design of compulsory insurance system. At last, depending on the successfulexperience of foreign country, government should take the multiple system responsibilities,including building the frame of compulsory insurance, supporting and distracting the risk ofinsurance compensation, monitoring the compulsory insurance market, and providing the public products of insurance.The fifth chapter is the conclusion of this paper, giving the solution in law method forChina compulsory insurance expansion, in judicial, legislative and marketing way. Afteranalysis735cases of transportation compulsory insurance, we can conclude that the methodof judicial expansion will easily destroy the theory of insurance technology, although it willprotect the vulnerable members. So, expansion in future should based on the balancebetween protection of the vulnerable members and insurance technology, through the methodsof legislation and marketing, which can be given as follows. The first aspect is expansion ofthe range of responsibilities. Intentional liability, joint liability, moral damage compensationand punitive compensation should be included in the insurance system. Second, controllingof moral risk, the scientific design of insurance contract term is needed to form customreasonably. The third aspect, improvement of business technology should be done,optimizing the insurance contract and controlling the business risk. Last, increasing thepolicy support of compulsory insurance is important. The government should increase thecompulsory insurance kinds, prefect the frame of compulsory insurance, promote thedevelopment of insurance products，support and distract the risk of insurance compensation,and monitor the compulsory insurance market.