| Insurance is an emerging industry of great importance in our country's economy. It not only has excellent prospect but also is faced with fierce international competition and violent system change. Comparing with the developed insurance industry, not only the depth and density of insurance market but also the regulatory rules established by the government are dissatisfactory. As the entry into WTO, our insurance industry is facing the 'equal competition, equal supervision'. The regulatory rules are crucial factors that influence the strength of our insurance industry.It is the primary responsibility of insurance regulatory department to keep insurance companies solvent. A series of insolvencies happened to some large Japanese insurers in the past few years and large sums of indemnity arising from 'September 11 disaster' in America has alerted us the solvencies of our country's insurers.Decrease of profit coming from insurance product pricing, the tide of commingling operation in finance industry, and direct investment in stock market by insurers are hot issues concerning our insurance industry. The issues tell us that there is something faulty between insurance operation and insurance regulation in practice. Therefore, it is an important task to learn from foreign countries' regulatory rules and find one that suits our reality.Solvency regulation has two aspects. The first one is regulation for general solvency which pays attention to product pricing and abundance of reserves established by the insurers. The second one is regulation for solvency margin with the requirement that the admitted capital and surplus of the insurance company should be kept more than the minimum solvency margin calculated by the government. Many developed countries have strengthened regulation for solvency margin and relaxed control in product pricing.The 'European rule' and 'American rule' are two main methods to measure solvency margin. NAIC (National Association of Insurance Commission) of United States has employed RBC (Risk-Based Capital) rule to measure solvency margin. Abundant literatures in our country have mentioned the detailed process to use these methods and concluded that 'European rule' is simpler than 'American rule' and the latter is not suitable for our country.Although China Insurance Regulatory Commission (CIRC) employed 'European rule' in 2003 to develop our own rule to measure solvency margin, the RBC rule developed by NAIC is worthy of studying for the fact that it is so far the most complete model to demonstrate the risks of insurers. Our country has not adopted the RBC method, though it is helpful for improving our own rule. Hence, it is of some theoretical and practical significance to conduct a further study on American RBC rule dealing with these aspects: origination of the rule, theoretical and mathematical principles, and its efficiencies.What this thesis wants to accomplish is carried out in turn as follows: the first one is to make a thorough review of the development history of solvency regulation in the United States and expound the underlying motives. The second one is to seek for the theory of RBC and some positive evidence of its performance in order to discover the value of the RBC method and find the logic and practicability for us to employ. The last one is to analyze the pre-requisites for us to employ the RBC rule and put forth some suggestions to improve our regulation on insurers' solvency.Through research, the author draws a conclusion that the RBC Rule developed and applied by NAIC is of great value for our government to improving our own rules, but it should be adopted with some reservations because of certain differences between the two insurance industries.This thesis is characterized by using the Historic Analysis Method creatively to retrospect the development history of American insurance regulatory rules. And the author tries to establish the economic base of solvency regulation by employing modern Theories of Capital Structure. By... |
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