China's Diversified Life Insurance Contract Dispute Resolution Mechanism

The year of 2006 witnessed impressive development in insurance industry in China, with its annual income growing by 14.04%, reaching up to 564.14 billions RMB. At present, there are in total 41foriegn insurance companies in China, while another 133 foreign companies from 20countries and regions have their 195 representatives and agents in China. As an increasingly number of people benefit enormously from the insurance services, the complications between policy-holders and insurance agents gradually emerge. In recent years, those complications havebeen on the rise, coupled with a diversity of customer's complaints.With a brief analysis of the current situations of those complications and complaints, one could notice without much difficulty there are by principle two categories of solutions by law-suits and friendly negotiations. In most cases, friendly negotiations are preferred with satisfying results. In few cases, the failure of negations then gives birth to law-suits.As legislations, practices and developments differ in different countries of the world, the mechanism to solve those complications and complaints correspondingly vary. Quite understandably, those foreign insurance companies enjoy a favorable advantage with regard to their dispute-solving mechanism, while China has only a limited dispute-solving mechanism of negotiation and lawsuits. A well-development and diversified mechanism is thus yet to be established.Moreover, practices and experience in other countries also indicate it is impossible to meet the demands of a diversified disputes and complications in insurance industry simply by law-suits. Correspondingly, a diversified mechanism in problem shooting is thus in urgent need, with its basis on legislation.With a detailed research and analysis for several leading insurance companies in China, the essay endeavors to offer theoretical basis for establishing a diversified mechanism in solving complications and disputes in insurance contracts and to promote the further and sound development in insurance industry in China, while drawing experience from other foreign counterparts in insurance industry.