The Research On Market Governance Function Of China’s Insurance Associations

With the market-oriented reform and institutional innovation, the industry association or " the third force ", a new way of governance beyond the state governance and the market. It plays the bridge and a link connecting role in the communication between governments and business relationships, while also maintaining the market order, thus, the industry association’s role of market-oriented reforms is increasing apparently.Based on the theory of governance, introduced with the specific work cases in Shenzhen Insurance Association, the paper presents the function and limits of the insurance association in market governance process and conduct corrective measures. Our findings do not only enrich the research methods in China’s insurance association and expand the scope of the study management theory, but also analyze the relations among the insurance association, insurance enterprises and the public. Our paper has important theoretical and practical significance. This paper consists of five parts, the first part introduces the background and purpose; the second part presents the basic theory of market governance of industry association; the third part analyzes the status, role, issues and trends of the governance the insurance associations, by introducing the specific work cases in Shenzhen Insurance Association; the fourth part explores the limits of governance of the insurance associations and the endogenous and external factors, also points out that its own issues in market governance; the last part introduces measures on behavior correction of the insurance industry associations in market governance.In this paper, it gives following conclusions:1. the industry association is defined as-"the social groups with common interests, voluntary entries, non-profit and mutual benefit," and can be summed as a mixed nature with "limited public interest", non-profit, benefit maintenance, partial private interests. Based on the theory of governance, under the industry self-regulation, it presents the relationships of industry representatives, industry services and inner communication among the members.2. Cooperation between the insurance industry associations and the government, the relationship between the insurance companies and mutual relationship with the insurance consumers are interdependent relationships. In market governance of insurance associations, the issues are the loosed internal management system, single source of operating expenses, the independence of poor market governance, weak binding of insurance companies and the lack of social credibility.3. Endogenous market barriers to association governance consists of imperfect internal governance structure, internal controls, weak incentives mechanisms; outer limits include the factors of government, business and the public relationship. The characterized factors in market governance of insurance association are imbalanced geographical economic development, competition in the market and the imperfect regulatory respectively. At last, the measures on improving market governance of insurance associations are as follows:a clearer boundary of governance, improved internal governance structure, strengthened government supervision and management, strengthened the incentive and public credibility mechanism, enhanced trans-regional communications among different insurance associations and the long-term development plans of insurance associations.