Use Of Insurance Funds

The rapidly developing insurance industry has accumulated very huge amount fund since China resumed the insurance business at 1980th. At the same time, the pressure of keeping and increasing the fund value is getting higher, the present investment channel is single and narrow, and it will lead to low efficiency of fund management. The narrow channel of fund management and lagged opening are the key and urgent problem of China's insurance industry.There are 3 stages of China's insurance fund management: without order stage, strictly control stage, and stage of both standardization and development. The implementation of newly edited "Insurance Law" was a jump-off point, the supervisor made a series of laws and rules. That was a symbol of the formal channel opening between insurance fund and capital market. Till then, the channel directly to the market was entirely opened.Objectively, in the long term, there are all kinds of problems in China's insurance fund management. These problems include: the great pressure of challenge from WTO, the narrow fund management channel, the low yield and the over-strict control, non-matching between the fund investment structure and debt structure, and the needs to solve the bad debt caused by interest difference lost and fund depreciation of the insurance companies, etc.After analyzing the insurance fund management of US, Japan, Britain and Korea, we can draw conclusions as follows: the fund management channel of insurance companies in developed countries are diverse, these arrangements are propitious to increase the yield and to secure the safety of the insurance fund.After summarizing the situation abroad, and together with the present status of our capital market, we put forward policy suggestions as below:l.The efficient way to standardize equity market behavior is to rectify information dissymmetry;2.To prudently choose the way of entering the market for insurance fund;3.There should be definite invest idea and perfect risk management;4.There should be strict and prudent external supervising;5.Storage of person with invest ability is the base for insurance fund to enter the market directly.We should have a reasonable view when we treat the problem about insurance fund entering the market directly. We have to enlarge the fund manage channel, establish flexible and diverse invest portfolios, those are the develop direction of China's insurance fund management, and the only way to secure the safety and yield of insurance fund to the most degree.