The Research Of Market Structure And Market Performance In Chinese Insurance Business

The insurance business has developed rapidly in recent years. According to the empirical research in this article, Chinese insurance business is still at a high degree of monopoly, with the characteristics of an oligopoly market, although the number of the insurance companies was rapidly increasing, especially the development of foreign insurance companies. Therefore, it is important for our country insurance market to research the relations between the insurance business structure and performance at present.This article has combed the market structure and market performance theory and has carried on the narration to the correlation literature. Then, the paper establishes the empirical model to reflect the relations of the market structure and the market performance in China insurance market. The result indicated that the Tradition Collusion Hypothesis and Efficient Structure Hypothesis were not applicable for China business. The reason is that China's insurance market has not experienced the complete cycle of economic development, not taking the possession of technical superiority or success of market strategy, but promoted by the Government to form the natural monopoly market structure. In the real diagnosis research foundation, this article further proposed how to enhance the insurance market performance, such as the establishment of a risk early warning mechanism, the improvement of the insurance coverage system, the cultivating multi-agent market system and the reducing of the insurance industry enter & exit barriers. To ensure the insurance industry could be in a good and orderly manner, the Government should create a favorable external environment.