Study On The Insurance System Of Sichuan Salt Transportation During The Republic Of China

Sichuan has a long history of salt mining.salt has been sold to surrounding provinces.Sichuan has lots of mountains and hills,and numerous rivers.So the salt was transported by water,and usually by wooden boat.Because of the fast-flowing rivers and numerous risks,salt used to be damaged frequently.The salt traders were looking forward to a risk-sharing mechanism that can reduce the risk of salt transportation.Insurance,one of the measures that can effectively reduce the risks,was introduced from abroad in the Qing Dynasty.Until 1926,Chongqing insurance market was gradually prosperous.The salt transportation insurance appeared in 1930.During the Republic of China,the salt transportation insurance continued to operate about 20 years.From the analysis of organizational structure,insurance policy,insurance pricing mechanism,underwriting mechanism,we can find its operating mechanisms must be designed excellent.Then we analysis the risk aversion methods when insurance companies underwriting the salt transportation insurance.In this paper,the risks are divided into two types,named "natural risk"(due to natural factors)and "Man-made risk"(caused by asymmetric information in the market).For the prevention of natural risks,it is divided into "pre-prevention" and "afterwards-disposal." Man-made risk is caused by asymmetric information in the market.Because insurance companies can not fully grasp the salt trader's information,the salt traders also can not fully grasp the boat's information.So the adverse selection and moral hazard appeared.Insurance companies have adopted some risk prevention measures,to some extent,can effectively avoid the risk.Through these analyses,we can get the conclusions.First,the salt transportation insurance provides a means of risk aversion for the transportation of salt,and is beneficial to the development of Sichuan salt industry.Second,the proper design of salt transportation insurance operation mechanism is an important guarantee for the smooth operation of the salt transportation insurance.Third,studying these problems can provide some reference for the contemporary insurance companies to insure inland river transportation insurance,construct the ship quality standardization system,improve the procedure of accident investigation,and the construction of risk aversion mechanism.At last,we find that there are still many aspects of salt transportation insurance need to be further refined.