Research On Internal Control Of Small And Medium-sized Life Insurance Companies

The insurance industry is a fast-growing industry,especially in developing countries such as China,where it is growing more rapidly.Domestic insurance profits in 2015 has reached 282.4 billion yuan,insurance depth has reached 3.6%,and insurance density has reached 1768 yuan/person.Market size has overtaken Germany,France,the United Kingdom,the global ranking rose to third place.However,rapid development often obscures potential risks and lax management.In 2015,the use of insurance funds in the capital market attracted wide attention from all sides.The introduction of the emergency policy of supervision at the end of 2016 slowly suppressed this chaos,which can be traced back to the regulatory restrictions on the industry in 2012.Various parties have chasing insurance licences for the benefits and ignore the risks associated with the industry.Within the insurance company,the company’s management tends to focus on business development and underestimate internal control.2017 was the toughest year ever for insurance regulation,with regulators issuing more than 900 tickets.With the formation of the China Banking And Insurance Regulatory Commission,more severe and more wide regulatory policy has been set to reshape the industry pattern,which brought great challenges to the development of the industry.Insurance industry develops into an adjustment stage.During 2015-2017,more than 20 insurance companies were set up each year,and there were more than a dozen insurance companies waiting to be approved.Under the help of the internet,the original small and medium-sized insurance companies and new companies use the new technologies such as the internet and big data analysis to seize the segmented population and realize their own market development.Compared with the leading enterprises in the industry,the problems faced by small and medium-sized companies in internal control are more prominent.The life insurance industry is now in a period of adjustment and transformation,with greater competitive pressure on external development and governance pressure on internal management.The inability to combine internal controls with the company’s endogenous development is a common problem for small and medium-sized companies in the industry.Based on this,this paper conducts internal control research on A insurance company through the case study method.Company A is a small and medium-sized life insurance company in the industry.Through analyzing the internal construction of A insurance company,it finds out the effectiveness and defects of the internal control of A insurance company,and explores the impact on the development of the market environment and internal control defects of the company.Combine the internal control construction of Company A with the competitive environment in which it is located to study how to improve internal control defects and propose internal control improvement solutions for defects.This paper has six chapters,the contents are as follows:Chapter I: Introduction.First,discusses the background of this paper and puts forward the purpose,significance and importance of studying the internal control of small and medium-sized life insurance companies.This paper discusses the research results of domestic and foreign scholars and studies the causes of the high incidence of internal control defects and related influencing factors,and concludes that the small and medium-sized life insurance companies are the companies with greater risk of internal control defects.Improving the internal control has a stabilizing effect on the development of the company.Finally,the paper introduces the research ideas,research innovation points and shortcomings.Chapter II: An overview of internal control theory.This paper discusses the meaning and basic elements of internal control,as well as its relationship with strategic management and risk management,and focuses on the particularity of the internal control of insurance companies and the important process of the internal control of insurance companies.Chapter III: Analysis of the specific situation of company A.First of all,it verifies that company conforms to the definition of small and medium-sized life insurance company,and it introduces the basic situation of company A and the effectiveness of the internal control of this company,and also studies some cases to lead to the problems existing in the internal control of company A.Chapter IV: Analyse the competitive environment of Company A.First,this paper does the research of the life insurance industry,and then uses SWOT method on insurance company A.The aim is to combine internal control with the company’s development path,and to carry out the influence of internal control defects on company A’s market competition,so as to get an effective way to solve the internal control problem of Company A.Chapter V: According to the analysis of the above two chapters,this chapter discusses the scheme of solve the internal control defects of Company A,and finds out various measures to optimize the company at all levels.Chapter VI: Conclusion and research prospect.This paper evaluates the solutions of A insurance company’s internal control,and puts forward the limitation and future prospect of this paper.