The Analysis On The Efficiency Of Insurance Regulation

Understood the importance of insurance regulation, but the regulatory authority is not the bigger the better, overextended the scope of regulation and rigid regulatory means, often counterproductive, therefore, investigate the current insurance system and the effectiveness of policies seeking to improve space is the main research purposes.This article choosing an insurance regulatory system costs and benefits as a starting point to analyze the insurance regulatory system implementation costs and social benefits, both by comparison, the validity of the conclusions of regulatory regimes, and then discuss the reasonableness of regulatory policy, which is article writing ideas. However, the contents of complex insurance regulatory system, many things to attend, a tremendous amount of analysis of various aspects of the regulatory regime is not realistic, and therefore identify research perspectives at the same time, I also branches of insurance supervision system by analyzing the internal logic of contact, screening study, eventually solvency regulation, rate regulation, market conduct regulation and corporate governance structure and regulatory supervision of funds included in the study.This structure consists of seven chapters of writing the first chapter introduction, describes the research background, significance and research ideas, and insurance regulatory efficiency on the relevant literature to sort, straighten out the writing context. The second chapter is the main content is reviewed international insurance regulatory system, especially in the IAIS solvency of insurance, the insurance company governance structure, market behavior and other aspects of the insurance provisions, as China Insurance Regulatory policy frame of reference.In the third chapter describes the validity of the insurance solvency regulatory policy issues. Solvency regulatory system is the core, has been valued by regulatory authorities in the regulatory system occupies an important position, solvency of insurance company management indicators is critical, you can say that it is the axis of the regulatory system of solvency regulation can indeed affect the whole body to play the role of several other closely related regulatory regimes.The social cost of solvency regulation can be divided into direct costs, indirect costs and social costs of three parts. Regulatory authorities for the payment of personnel costs solvency regulation, expenses and other direct costs, the marginal cost of this part of the expenditure is small, too much spending without increasing the regulatory authorities will be able to complete the solvency regulation, but may be used by regulators a variety of methods to escape regulation, resulting in additional expenses being regulated, forming solvency regulation of overheads. Cost of solvency regulation focused on its opportunity cost, due to regulatory departments to continuously improve standards in order to ensure solvency ratio insurance company solvency adequacy trend, because this approach is easier for regulators, but also easier to operate, so the existing insurance regulatory solvency standards might be too high, this practice has also been in the insurance verification, high standards make insurers cannot be forced to invest a larger insurers, affecting the profitability of insurers, and ultimately enable the insured and the insured are not covered by the insurance investment, harm their interests. Despite solvency regulatory policy bias, but it’s also very obvious social benefits, through the strict supervision of solvency standards, China’s insurance industry does not appear the phenomenon of insurer bankruptcy, more stable operation of the insurance market, insurance companies, the amount of capital is also solvency under increasing regulatory requirements, expanding the size of the insurer’s capital, is conducive to the insurer’s business. Compare costs and benefits of solvency regulation, it can be concluded, in preventing bankruptcy and maintain insurance market stability, solvency regulatory policy to be effective, however, the social cost of solvency regulation also continue to reduce space, the current regulatory policy is inefficient.This chapter focuses on the effectiveness of regulatory policy premium rate. Rate regulation of insurance regulation is a hot research issue, rate regulation quite significant social costs, the current implementation of strict control policy rates was intended to prevent vicious competition in the insurance history of the development phase, the rate regulation does play proper role, however, as the insurance industry continues to advance, still using the rates strict control measures, it is outdated, it weakens after entering the insurance market competitiveness of insurance companies, may lead to a monopoly phenomenon, not conducive to long-term development of the insurance market. Rate regulation also gives consumers cannot rely on price signals to select insurance products, which makes the price mechanism’s role in the insurance market is denied, the result is insured and the insured person cannot fully exercise their right to choose. In addition, under the premise of strict rate regulation, regulators do not understand out of new products, may not approve the insurer’s product innovations which dealt a blow to the enthusiasm of the insured product innovation, so that the insurer conservative, not based on macro-changes in the economic environment and the insured, the insured person needs to design new types of insurance, insurance coverage resulting aging, no longer meet market demand, supply and demand for insurance conflict, hindering the development of the insurance market. However, rate regulation is not without benefits, it also made some social benefits, such as:a certain extent, to stop the adverse selection and moral hazard; prevent vicious competition competing price occurrence; prompting regulators to improve regulatory standards. However, regulatory policies and rates compared to the social costs caused by its social benefits appears to be minimal, and that the use of other regulatory policies can also achieve the above object, therefore, it can be concluded:rate regulation is invalid.Chapter V of writing contents insurance market conduct regulation and corporate governance structure regulation. Market conduct regulation and corporate governance regulation is the IAIS’s regulatory focus, market conduct supervision, solvency regulation and corporate governance regulation constitutes the three pillars of insurance regulation. Insurance market behavior can be based on the content and behavior of actors is divided into several categories, in view of the actual situation of the insurance market, the author will focus on writing insurance intermediary acts, breach of fraud.The current behavior of the insurance market has made some effective regulatory regime, and its cost is only bring direct social costs and regulatory incremental transaction costs in two parts, in general, the regulatory revenue is greater than the cost of regulation, so the insurance market conduct regulation is An effective supervision, should strengthen market conduct supervision, to lay the foundation for the solvency regulation.The corporate governance structure of regulation on the sound development of the insurance market has great benefits, regulatory authorities need to strengthen regulatory governance structure of insurance companies, insurance companies streamline internal mechanism, establish reasonable and effective scientific division of powers system to address the shareholders, the Board of Directors, executives between conflicts of interest in order to make the insurance company safe and efficient operation and management activities, so that the insured and the insured benefit. Meanwhile, standardized corporate governance structure directly affects the insurance solvency of insurance companies, affecting the entire macro-insurance market.This Chapter is about the use of insurance funds analysis of the effectiveness of regulatory policies. Insurance funds are regulated safety regulatory guidelines, however, too much emphasis on the security of the insurance investment of insurance funds, but at the expense of profitability for the price, this is where the cost of the insurance investment regulation. Because of the use of insurance funds have many limitations, the insurance company missed many investment opportunities, reduce capital efficiency and indirectly affect the solvency and investment channels and the limitations of the investment structure more so that this problem worse, so the regulatory policies of insurance funds the cost is actually enormous, which completely exposed the country’s insurance funds regulatory inefficiency, of course, it cannot all be attributed to regulatory authorities for the strict supervision of the use of funds, financial market investment macroeconomic environment has an important influence on the insurance. However, regulatory authorities should ensure that the funds under the premise of safety, try to broaden the investment channels, relaxing restrictions on the investment structure is necessary.Through the analysis of the above aspects, in general, the existing insurance regulatory measures, though partially effective, but its efficiency is relatively low, the view of this, in the seventh chapter the author put forward some policies and suggestions for reference.First, the concept of regulation change is imperative that regulators previous "headache medicine head, feet hurt the disease" model of the insurance industry a hundred harm, for lack of predictability situation that may arise on the already emerging blindly adopt regulatory issues blocking approach, which makes regulatory authorities in the regulatory process appears to be very passive, therefore, becomes "too late" to " Qutuxixin" and change "coercion" to "incentives" particularly important for the regulatory authorities, in addition, regulatory authorities should also maintain policy independence cannot be too much affected by public opinion, such as:too much focus on protecting the insured and the insured person’s rights and interests, ignoring the legitimate rights and interests of the insurance protection.Secondly, to achieve the above regulatory concept of change, improve regulatory standards is a necessary condition. Regulators professionalism and professionalism should be higher than the regulated, so as to grasp the macro level policy direction in order to establish efficient regulatory policy, unfortunately, China’s regulators have not yet reached this level, there has been professional regulators higher than regulators phenomenon, the resulting outcome are the two regulators led by the nose by the insurance company, four fire; Second, regulators despite the inherent law of development of the insurance industry, the use of administrative means to force the implementation of regulatory policies, hinder the development of the insurance industry. Therefore, regulators should face up to their own shortcomings, and effectively improve the level of supervision, to absorb a number of rich work experience personnel to enter the insurance supervision team to establish interaction with academic experts to hear their views on long-term mechanism.Finally, I believe that to solve the existing regulatory inefficiencies, but also to take some practical measures, including:relaxation rates strict supervision; insist on solvency regulation, and deepen regulatory connotation; establish insurance market exit mechanism; strengthen the behavior of the market supervision, improve market discipline mechanism.Based on the research process, due to the level of research and research time constraints, did not consider the reinsurance policy, which is the author’s efforts in the direction of future research.