In recent years,the business structure of China’s property insurance market has undergone profound changes.The market share of automobile insurance business has declined year after year.However,the non automobile insurance business represented by agricultural insurance,liability insurance and short-term health insurance has developed rapidly with the increase of demand and policy support.The market share has risen rapidly,but it is faced with the possibility of huge compensation to varying degrees.Will the transformation of property insurance companies from focusing on automobile insurance to paying equal attention to automobile insurance and non automobile insurance affect the financial stability of the company? Is it positive or negative? Taking this problem as the starting point,this paper makes a theoretical analysis using the synergy effect theory and co insurance effect theory.Combined with the current situation of China’s property insurance market,this paper discusses the relationship between the development of non auto insurance business of property insurance companies and their financial stability from three dimensions: overall property insurance companies,Chinese and foreign property insurance companies and property insurance companies of different sizes.Based on the unbalanced panel data of China’s property insurance companies from 2015 to 2019,this paper uses Z-score and the proportion of non auto insurance business to measure the financial stability and the development of non auto insurance business of property insurance companies respectively,uses heteroscedasticity robust standard error,uses OLS regression as the benchmark regression to test the relationship between the development of non auto insurance business and the financial stability of the company,and uses DWH test to judge whether the proportion of non auto insurance business is an endogenous variable,The instrumental variable method is used to solve the endogenous problem.In order to ensure the robustness of the regression results,the two-stage least square method(2SLS),limited information maximum likelihood method(liml)and generalized moment estimation(GMM)are used for regression respectively,and the three-year rolling standard deviation of return on total assets,huffindal index and entropy index are used to replace Z-score and the proportion of non auto insurance business respectively for robustness test,so as to ensure the reliability of the research results.In addition,it also makes a heterogeneity analysis on the grouping regression of Chinese and foreign property insurance companies and property insurance companies of different sizes.The results show that by developing non auto insurance business and realizing business diversification,property insurance companies can promote the company to produce economies of scale and scope,reduce financing costs,form synergy and co insurance effect,and then improve the financial stability of the company.From the perspective of company nature,due to the reasonable insurance structure and high business maturity,the non auto insurance business of foreign-funded property insurance companies has a positive correlation with financial stability.From the perspective of company size,the development of non auto insurance business by small and medium-sized property insurance companies can bring synergy to intensive management,marketing and R & D expenses,which can significantly improve the company’s financial stability.According to the research results,this paper puts forward policy suggestions from the perspective of the whole,Chinese and foreign property insurance companies and property insurance companies of different sizes:(1)on the whole,we should speed up the transformation and upgrading of property insurance companies and promote the equal development of auto insurance and non auto insurance.(2)Chinese property insurance companies should build a data sharing platform and strengthen the construction of professional talents.(3)For foreign-funded property insurance companies,we should strengthen opening to the outside world and enhance market vitality and competitiveness.(4)In the next stage,large property insurance companies should strengthen the application of insurance technology and optimize the efficiency of resource allocation.(5)Small and medium-sized property insurance companies should upgrade the supply of products and services and expand the extension of online business. |