Research On Early Warning Model Of Life Insurance Company's Financial Risk

Life insurance industry has specific vulnerability and sensitivity of financial industry in operation,the change of objective environment, making mistakes in decision, Mismanagement etc. All can make its assets, credit losses, even trigger the financial crisis. Operating conditions not only be related to their own interests, but also have an important impact on the entire financial industry and even national financial stability, social stability and economic development.In the course of its business, life insurance companies must consider financial risk at any time. Once abnormal response arises, it should be initiated to take steps avoid or reduce damage for the enterprise. Building effective early warning models of financial risk., no matter from which side is needed. Therefore to prevent the financial crisis in China, the normal operation of the economy and social stability, the study of Chinese life insurance company's financial risk early warning model is of great significance.Life insurance companies'financial risk include interest rate risk, asset risk, credit risk and pricing risk, embodied in the capital shortage, lack of responsibility reserve escrow, irrational asset structure, low profitability, concentrated in the insolvency. Currently, many scholars study the solvency problem from the asset quality, capital structure and bankruptcy probability. This paper seeks from a different point of view, using fuzzy optimizing BP artificial neural network to establish life insurance companies'financial risk early warning model, First it explains the financial risk of life insurance companies in the theory, China's life insurance industry in particular financial risk, and analysis Chinese life insurance industry's special financial risk. Then it compares the existing financial risk early warning model, and with characteristics of the life insurance business and our financial system, construct the basic financial indicators system reflecting the financial risk of life insurance companies from the profitability, solvency and operational capacity. On this basis, it mainly inspects related financial indicators of 2000-2008 of the China Life Insurance Company, and uses fuzzy optimizing and BP artificial neural network model for life insurance companies of the early warning monitoring, and offers the financial risk of life insurance company early warning methods and ideas, and conducts an empirical study. Finally, it points out the index system and sample size's innovation and inadequate of the model by assessment of the applicability and limitations.Based on the content and conclusions of the study, this paper presents recommendations related to follow-up study and prevention measures of life insurance companies'financial risk. Life insurance industry guard against and defuse that mainly relies on rising profitability, solvency and management level. Explore risks early warning models and effective preventive measures to promote the life insurance industry, the rapid, sustainable growth are one of the key research topics about life insurance companies in recent years.