International Comparison Of Solvency Regulation And Its Implication For China Risk Oriented Solvency System

Insurance companies are companies which deal with risks, which are said to be the" lubricant of social ", the healthy development of insurance companies is very important for boosting national economy. There are so many risks in the business of the insurance companies that establishing an efficient regulatory system is an important barrier to the insurance company to survive. The solvency of insurance companies is the ability to repay debts. The insurance company has adequate solvency is the premise of the insured to obtain the insurance. Therefore, the insurance solvency regulation has been the focus of the world insurance supervision. There are a lot of insurance regulation theories in the process of insurance regulation, such as the EU solvency regulation theory and the United States of America RBC theory, these theories often have different characteristics, applicable to different situation, and they are in the changing process.With the development of the world economy, the risk of insurance companies is also changing. Especially after the2008financial crisis, the world capital market become weakness, investment risks are more and more remarkable, In this new situation, the existing regulatory model is not suited to the development of economy, the establishment of China’s second generation solvency supervision system has become the important work of China Insurance Regulatory Commission (CIRC). In early2012, CIRC issued the " The plan of China’s second generation solvency supervision system construction ", drawing the blueprint for China’s new generation of solvency regulation construction.In this situation, this article focus on the insurance solvency regulation.In order to provide some suggestions on construction of the solvency regulation. This topic expounds solvency regulation theory from three aspects. At first, it points out the lack of China’s current solvency regulation in two aspects including qualitative and quantitative. Qualitative research is based on the Cummins standard, while quantitative research is based on the ratio model, The second is reference to the international advanced experience reference, including Solvency I, Solvency II,RBC,ICPs and so on. In particular, focus on Solvency II, a detailed description of its emergence and development, as well as the main content is written. Finally, we suggest that, supervisors, should take the model that Risk-based capital requirement such as EU Solvency Ⅱ, which is a system with three mainstay.The contribution of this paper is that we take the Cummins evaluation criteria for the evaluation of our current solvency regulation system, we could get the difference with the international advanced experience, so we can know where governments should focus their efforts. The innovation of this paper is to adhere to base on the actual situation of China’s insurance industry, absorbing international advanced regulation experience critically. The shortage of this paper is that the conclusions and recommendations of this paper is qualitative, pointing out the direction without operating rules, which is the main development directions.