Research On Business Efficiency Evaluation Of Life Insurance Companies In China Based On RS-DEA

In the National Insurance Regulatory Work Conference of2012, Wenhui Chen, TheVice President of China Insurance Regulatory Commission, emphasized that our lifeinsurance companies are facing tougher and tougher internal and external marketenvironment. The development of the industry is facing many challenges. Affected by theinstable external investment environment and the extensive development, the potentialrisks are emerging gradually in the development of the life insurance companies whichmake the future development even more difficult. The main problems are as follows:solvency pressure, simple business structure, low competitiveness of products, lack ofimpetus to the development of the industry, etc. All of these problems can be attributed tothe operational problem of the company. By studying on the management efficiency, wecan find out main factors that affect the management efficiency of the insurance companiesin our country. Meanwhile, the research enables us to analyze the deficiency of the indexfactor. Nowadays the life insurance market is becoming larger with the flux of foreigncapital and rapid development of domestic insurance companies, the work can help our lifeinsurance companies to improve management efficiency and enhance the competitivenessof our life insurance companies.Firstly, this paper aims to establish a systematic, reasonable management efficiencyevaluation system of life insurance companies by using Data Envelopment Analysismethod. Secondly this paper conducts the research to the fifteen life insurance companies’management efficiency based on the data of2010. This paper only evaluates the technicalefficiency. Based on Data Envelopment Analysis on the technical efficiency to themanagement efficiency of our life insurance, and combined with rough set method, thispaper selects the main factors that affect the management efficiency of our life insurance,the research conclusion can achieve our goals, that is, the evaluation and decision on ourlife insurance companies’ management efficiency will be faster and more effective. Thispaper is divided into five chapters and the main study contents as follows:Chapter one, this paper introduces the background and significance of the subject.Under the background that the external economic circumstance develops rapidly, through the analysis to the current development situation of our life insurance companies, andcombined with previous studies, this paper establishes the research method, the maincontent and the innovation.Chapter two, this paper simply discusses the research theoretical basis of themanagement efficiency of our life insurance companies and constructs the evaluationindexes principle of our life insurance companies, and mainly gives the theories and theparameters method and method of parameter on efficiency, we determine the researchdirection and the theory method in this paper based on the analysis of these theories andmethods.Chapter three, this chapter introduces Data Envelopment Analysis and rough set thatused in this paper. According to the research needs of this paper, this chapter introduces themodel of constant returns to scale of Data Envelopment Analysis method and the theory ofrough set, in order to construct the system of evaluating the efficiency of our life insurancecompanies using the two methods, and execute the evaluation to our insurance companies.Chapter four, this chapter is the empirical part of this paper, through selecting inputindexes and output indexes, we evaluates the top15life insurance in the life insurancemarket in2010. Using Data Envelopment Analysis, we can evaluate the efficiency of ourlife insurance companies through calculating the input and output indexes. Based onevaluation results, we can reduct the attribute indexes which affect the managementefficiency of our life insurance companies and decision with the help of RS software, andget a lot of significant decision rule of our life insurance companies.Chapter five, the main content of this chapter is that we can conclude the researchresults of this paper through the introduction of the theories and methods and empiricalstudies ahead. According to the result of the management efficiency of our life insurancecompanies using Data Envelopment Analysis method, we can evaluate the efficiency of ourlife insurance companies properly with the help of reducting the attribute indexes. Thismethod is more efficient, more practical and used more widely compared with DataEnvelopment Analysis method. Finally, this part discusses the future research direction.