Empirical Research On The Effects Of Foreign Insurance Entry On The Efficieney Of Chinese Insurance Companies

With China’s accession to the WTO in December11，2001，Foreign insurance enterinto our country on a large scale.This is a "double-edged sword" to the development ofChinese insurance companies. Entry of Foreign insurance on the one hand has broughtadvanced technology，advanced management concepts and operation models，promotedChinese insurance companies efficiency through competition and spillover effects.Andon the other hand，this will also pose threats to them.Therefore，how to evaluate theeffects of Foreign insurance entry on the efficieney of Chinese insurance companies in adecade has become an important topic of the times.Based on this background, this article uses a lot of theories, such as finance,economics and industrial organization.First, this paper analyzes the courses, methodsand motives of foreign insurance into China.Then, it analyzes the positive and thenegative impacts that brought to the efficiency of Chinese insurance companies byforeign insurance.At last, it uses an empirical model to verify the competition andspillovers brought by Foreign insurance.The major empirical results in the article are listed as follows：（1）Foreign insurance institutions show a weak positive correlation between theefficiency of Chinese-funded insurance company.This result shows that Chineseinsurance companies need to further improve the responsiveness of the behavior offoreign insurance.（2）The proportion of asset size of Foreign insurance bring a significantcompetitive effect，while the market share of foreign insurance competition effect is notobvious. This shows that in the competition for market share，the foreign insuranceindeed generated a certain degree of threat to Chinese insurance companies. （3）The spillover effects brought by human capital flows show a negativecorrelation with the efficiency values.That is to say, the fierce competition and thespillover effect in the market are not obvious.Finally，The article put forward policy recommendations from a macro and microperspective. From the macro，we should continue to create a competitive environment，to strengthen legal management，to further capitalize on the open rhythm; From themicro，Chinese insurance companies should improve their ownership structure，expandinvestment channels，and timely implementation of the "going out" strategy.