Research Of The Application Of Life Insurance Trust In China

Our dweller fortune has expanded rapidly during recent years and a considerable wealthy people who have plenty disposable income have emerged. These people have gone through the phase of wealth expansion and accumulation as well as the 2008 global financial crisis, whose risk awareness have greatly strengthened. According to the statistics, the primary goal of domestic wealthy people have shift from “wealth expansion” to “wealth protection”. They value more about wealth inheritance, children’s education and family life, etc. The majority has accepted insurance as a major tool to assure wealth inheritance. Recent years, high value insurance policy has constantly appeared which is use to transfer wealth and inheritance due to its tax avoidance function and legal protection of insurance interest. In real practice, when the insured of a life insurance contract passed away, their children can receive insurance benefit as beneficiaries. However, the wishes of insurance applicants cannot be guaranteed by insurance if the beneficiaries are juveniles or unable to control insurance benefit. Therefore, a combination of insurance and trust—life insurance trust was creating. As extension besides the guarantee function of insurance products, life insurance trust can save tax and manage money, which satisfy the needs of personal financing market in domestic. Hence, these theses intend to introduce the concept of life insurance trust, its operation model and its adaptability in China. Based on that, this thesis would propose several advices to serve the development of life insurance trust in China.The first chapter of this thesis is introduction, which include five parts, research background and significance, literature review, main content, research method and innovative points.The second chapter has two parts. First, it explains the concepts in this thesis, including trust, life insurance trust, its origins, development and classification. After that, it demonstrates the necessity and feasibility of conducting life insurance trust in our country. This thesis illustrates necessity from three aspects and applies rigorous data to prove that we have anxious demand of life insurance trust products. Next, through economic theory and legal construction, we conducted the analysis of feasibility and concluded that we have realistic foundation to carry out life insurance trust.The third chapter mainly describes the current situation and problems of life insurance trust in our country. This thesis explains the possible problems in three levels based on current development and provide solutions in the next chapter.The forth chapter introduces the development of life insurance trust in both USA and Taiwan. Figures and charts were use to conduct a comparative study regarding the operation model and system of life insurance trust between these two regions. I dwell on the differences in three aspects. The comparison can better help us to deeply understand the system of life insurance trust and find suitable operation model for our country.The fifth chapter is key chapter of this thesis, where I propose the thoughts and advice of developing life insurance trust system in our country. Based on the above analysis, I put forward four suggestions, which include what operation and business model is the best for life insurance trust in China. For the possible loopholes, I come up with the method of regulating rights and responsibilities of contracting parties and bring in trust supervisor system. In addition, I deepen the thoughts of developing life insurance trust in China and try to find the best way to fit the current situation in China.The innovative points of this thesis are following:First, this thesis conducts comparative study between USA and Taiwan, which is the first time. In addition, through analysis, I obtained the differences and explained the reasons in detail, which provide experience for us to build and develop life insurance trust.Second, based on the experiences of life insurance trust development in other countries together with the specific condition in our country, I put forward the possible operation model and business model for life insurance trust, solve the problems existed in the current trust and insurance market and find the right moment to development life insurance trust.Third, this thesis brings trust supervisor system to life insurance trust in our country in a creative way in order to tackle with the possible problems in expansion. After a brief introduction of trust supervisor system in Taiwan, I adapt its strength, avoid its shortcomings, and provide four suggestions to build our own trust supervisor system, which has an important implications to perfect trust legal system and assure the healthy development of life insurance trust.