Research On The Eva And Econimic Capital From The Perspective Of Principal-agent Theory

The World Insurance Industry Report released by the Swiss Reinsurance Research Institute shows that China's premium income ranks second in the world in 2018,which indicates that the insurance industry in China is growing at a rapid pace,and huge insurance needs are formed by a huge population base to from the vast insurance development space.With the implementation of the C-ROSS in the insurance industry and the incessant opening-up policy,China's joint-stock insurance companies with principalagent relationships are not only concerned with external development opportunities,but also with internal Risk control related to economic capital;not only pay attention to income and profit on financial statements,but also introduce economic value added(EVA)to pay attention to capital as a cost to shareholders.In the empirical part of economic value added(EVA),this paper takes Ping An,New China life Insurance,China Pacific Insurance and China Life Insurance as four A-share listed insurance companies as research objects,and uses the relevant financial data from 2014 to 2018 to calculate economic value added(EVA)of these four insurance companies.The results show that the average economic value added(EVA)of the four sample insurance companies are positive,which shows that the value is created for the shareholders and the business performance is good.Among them,Ping An's economic value added(EVA)and EVA per share are significantly higher than the other three sample insurance companies,and the analysis shows that it is different from the other three state-controlled sample insurance companies.As a joint-stock company,Ping An has innovative vitality and is more able to create value for shareholders.In the part of optimal capital allocation in the principal-agent condition,this paper sets four variables: investment opportunity,initial capital,reward function and economic capital,introduces economic capital to modify EVA,and establishes relevant constraint function for operators(agents).Therefore,the model is established to obtain the optimal capital level under the principal-agent condition,and to provide some suggestions to the shareholders(principals)when formulating the plan.