A Study On The Period Payment Transformation Of Chinese Bancassurance Industry

Along with the gradual reform and development of bank and insurance industry in our country,the business model of commercial banks acting as insurance sales has experienced 20 years of rapid development starting from scratch.Ever since 1996,banks have been one of the three pillars of sales channels of insurance products.Despite years of swift development of bancassurance business,the mode is relatively extensive,the overall business structure is unreasonable,and sales model is monotonous.A majority of the insurance products sold are of financial property,of short and medium duration,or of a low level of security,which has severely deviated the insurance products from its inherent nature as a safeguard and protection.Such issues as misleading sales,irregular operations and the like are also widespread.At the same time,this unhealthy product structure also undermines the value of the bancassurance business,preventing itself from bringing sustainable and stable premium income to the insurance agencies.Moreover,intense competition pressure among commercial bank agents also leads to a declining profitability of the insurance institutions.On the contrary,period paid products can effectively lock the customers for a long time,and thus can bring along a stable cash flow.The higher share of period paid products,the stronger the sustainability performance.Therefore,it is an inevitable direction of various insurance companies in the future to vigorously expand period paid product business and strengthen expertise team construction,so as to accelerate performance growth.With a case study on phase transformation of Bancassurance Department of Beijing Branch of CITIC-Prudential Life Insurance Co.Ltd(hereafter Beijing Branch),this essay focuses on economic logic of transformation to period paid products,possible effects,problems and necessary policy revisions during the transformation,in order to provide references on period paid product transformation in bancassurance for other insurance companies in the market.In the first chapter of this paper,we provide an introduction to the background,purpose and significance of the transformation,and we also clarify our research methodologies.Chapter two is the literature review,introducing relevant studies at home and abroad,with a simple comment on the existing literature and the potential research area for the current paper.The third chapter analyzes the necessity of period payment transformation from such three aspects as cooperation mode,policy supervision and market operation.Chapter four employs SWOT analysis to analyze the strengths,weaknesses,opportunities and threats of the period payment transformation with the case study of Beijing Branch.Using the data of Beijing Branch before and after the transformation,we show the necessity and its economic significance.In the fifth chapter,we study the challenges of Beijing Branch during such a transformation,and afterwards put forward several corresponding policy suggestions.Chapter six concludes this essay,summarizing our main findings and viewpoints,and pointing out possible shortcomings of the paper as well as directions for the future research.