Study On The Relation Of Chinese Insurance Market Structure, Efficiency And Performance

Market Performance has always been the emphasis of the theory of industrial organization, but usually we study it through finding the relation between market structure and market performance. For the relation between them, Scholars have made a lot of study in theoretic and demonstrational aspects and formed different genres. But there is not so much study on insurance industry in and abroad. With the development of insurance and it has played more and more important part in the economy. So the study of insurance is becoming the issue of academia.Nowadays in China, insurance industry has more and more opened to the world, more and more insurance companies are being established. Under the new situation, Studying the relation between the market structure and performance, finding the efficiency and performance difference between types of insurance companies is very meaningful.This thesis first introduces the structure,efficiency and performance of China life insurance market and Property Casualty insurance market, Second, analyze theory of "Market Structure and Market Performance" meanwhile using statistic tool to analyze the insurance company performance on the basis of 15 life insurance and 13 Property Casualty insurance . And We find the Joint-venture life insurance has more better performance and better efficiency than Chinese and Foreign life insurance, the reason is that the establishment year of Joint-venture life insurance is too short and the two side has a lot of differences meanwhile the life insurance has its specialty. But in the Property Casualty insurance market, the foreign insurance company has better efficiency than the Chinese ones. Maybe the advanced operation ideas lead to this. And using DEA to analyze the efficiency different insurance companies and draw the similar conclusion to the performance of insurance market. At last the thesis has established four equations using the theory of Berger & Hannan(1997) and the equation of Timme&Yang(1991) .especially analyzing the "scale-efficient structure " hypothesis and "X-efficient structure hypothesis " using statistic tool to validate Chinese insurance market. This is maybe the innovation point of this thesis.The conclusion is that no matter life insurance or property Casualty insurance market, all does not suit the "S-C-P" hypothesis and "Efficient structure" hypothesis. The reason is that some non-market mechanism and government regulation has stopped the development; meanwhile the insurance companies also need to change their ideas of management.