Regional Differences Of Product Structure In Life Insurance Industry:An Empirical Investigation

The life insurance industry has experienced an essential change since1996when the property insurance and life insurance began to operate separately. The essential change is mainly reflected in two ways, one lays on the rising power of life insurance which plays a more important role in social harmony and economic development, and the other lays on the increasingly rich insurance products which meet the diverse needs of different groups. The multiple life insurance products not only provide the society with basic risk-prevention measure, but also satisfy the investment demand of some groups. These groundbreaking product innovations promote the status of the life insurance industry in the financial markets and the public’s acceptance of life insurance, laying a solid foundation for the healthy development of the life insurance industry.The structure of life insurance products refers to the proportion of premium of each life insurance product. Among the four main products, participating insurance、university insurance and Investment linked insurance are new products which have the investment function in common, while the traditional insurance provides basic risk prevention only. Conducting a research on the structure of these four product categories is valuable for further research on insurance industry and the sustainable and healthy development of economics.Due to the difference in population、natural environment、economic and social status between each region, life insurance product structure presents obvious regional differences. These differences could be explained mainly in the difference of proportion of participating insurance because the participating insurance takes up a large proportion in the whole life insurance industry. Although some scholars have realized this phenomenon, they didn’t take it into rigorous data analysis. This article attempts to conduct a general analysis on regional differences of life insurance product structure in China, then analysis factors which affect the formation of the life insurance product structure in different regions through the empirical analysis. The formation mechanism could be explained in three aspects: supply、demand and the insurance intermediary. Insurance demand is subject to economic status、social culture、risk recognition which have impact on the consuming decision. The empirical analysis is divided into two modules:one is variance analysis which tries to prove the existence of significant differences on life insurance product structure in the three areas; the other one is multiple linear regression analysis conducted via SPSS. The conclusion of this article is not the same as done before. For years people had deemed the western region as undeveloped in life insurance compared with the eastern and central China, while this article found that the development of life insurance in the western and central are on the same level. According to the empirical analysis, some suggestions are put forward to narrow the regional difference and promote the balanced development of regional life insurance.