Research On Profitability Of Small And Medium-Sized Property Insurance Companies Under The Background Of Comprehensive Reform Of Auto Insurance

Auto insurance is the leading type of insurance in Chinese property insurance companies.The quality of auto insurance business determines the development direction of enterprises and even the whole insurance industry.China’s auto insurance industry started late,and the operation and management of the early auto insurance market was extensive.In order to guide the healthy development of the industry,China Insurance Regulatory Commission implemented several auto insurance reforms.For consumers,the policy price is more reasonable and the coverage is more comprehensive.However,for insurance companies,the operating pressure is also increasing,especially for small and medium-sized property insurance companies,the profitability of auto insurance has been greatly challenged.The pursuit of profit is the objective need of enterprise operation and development.Profitability determines the performance of enterprise operation.For a long time,Chinese property insurance companies,especially small and medium-sized insurance enterprises,have been taking the investment profit model as the main way to make profits,but as the underwriting of main business,they have been in a state of loss.This paper argues that the two profit models of underwriting and investment are not opposite,and investment decisions should be based on underwriting profit.As long as the enterprise is properly operated,it can fully realize the "two-wheel drive".With the advance of auto insurance marketization,insurance companies will face huge operational risks if they continue to allow underwriting losses and place profits on the capital market.In order to verify the above views,this paper carried out tiling analysis and regression analysis on the relevant data of auto insurance from 2013 to 2020 respectively,and then came to the conclusion that the size of auto insurance premium determines the profitability of auto insurance,and it is easier for large companies to obtain profits by diluting fixed costs.At the same time,there is a negative relationship between the cost index and the profit rate,while there is a positive relationship between the cost index and the premium growth rate.In addition,under the influence of auto insurance reform,the changes between premium growth and profit rate gradually converge,indicating that effective cost control can enable enterprises to achieve business and profit growth together.The profitability of small and medium-sized companies represents the overall level of the market.The analysis results of this paper do not conform to the development law of large companies,which reflects the essential reason for the increasingly serious Matthew effect in the auto insurance industry in reality.To sum up,small and medium-sized companies must realize the importance of making profits from auto insurance underwriting,adjust their development strategies,take effective measures to stop losses in time,and most importantly,strengthen reasonable cost control.This paper gives some suggestions for the profitability of small and medium-sized companies,hoping that small and medium-sized companies can find a suitable way to develop as soon as possible.