China's insurance industry
Top 10 News
On December 30, the top 10 news of China's insurance industry in 2023 selected by China Banking and Insurance News was officially released.
one
** Financial work conference heldClarify the functions of the insurance industry as an economic shock absorber and social stabilizer
In October 2023, the ** Financial Work Conference clarified the functional positioning of the insurance industry and required the insurance industry to play its role as an economic shock absorber and a social stabilizer. Since the official launch of the State Administration of Financial Supervision on May 18, under the guidance of the new regulator, the insurance industry has ushered in a new round of development opportunities, further integrated into the financial landscape, and at the same time faced stricter supervision. The supervisory work symposium held after the establishment of the State Administration of Financial Supervision once again emphasized that the insurance industry should give better play to its functions as an economic shock absorber and a social stabilizer. The insurance industry has a deep grasp of its own functional positioning, and accurately and efficiently meets the insurance needs of the real economy and the people by improving its professional capabilities in risk pricing, refined management, risk reduction management, and asset and liability management.
Expert commentary
Zheng Wei, Dean of the Department of Risk Management and Insurance, School of Economics, Peking University
* The Financial Work Conference emphasized that "finance should provide high-quality services for economic and social development" and called for "giving full play to the functions of the insurance industry as an economic shock absorber and social stabilizer", which echo each other. Compared with the last financial work conference, this meeting further emphasized the requirements for the insurance industry from the perspective of economic and social development. The insurance industry should give full play to its professional advantages, and better prevent and reduce the negative impact of various risks on the economy and society, enhance social stability, and provide strong support for Chinese-style modernization by doing a good job in risk protection, financial integration, and social management. In the new round of comprehensively deepening reform, building a high-level socialist market economic system is an important content. An imperfect market economy in the insurance industry is not a perfect market economy, and a high-level socialist market economy needs a high-quality insurance industry as a strong support.
Related Reports:
II. II. II
Actively support flood prevention and disaster relief and post-disaster reconstructionThe insurance industry has a unique role to play
In the month of 2023, extreme rainfall occurred in North China, Huanghuai and other places, causing floods and geological disasters. Under the guidance of the State Administration of Financial Regulation, insurance institutions adhere to the supremacy of the people and the supremacy of life, quickly start the emergency plan for major emergencies, set up a special class for flood prevention and disaster relief, and the relevant person in charge led the team to the front line of the disaster to supervise the quick settlement of claims and fully cooperate with the rescue work in various places. All insurance institutions have opened up green channels to simplify the claims process to the greatest extent, adhere to the principle of "special affairs, urgent matters", and make every effort to improve the quality and efficiency of claims services. At the same time, we will increase the intensity of advance compensation to minimize the impact of flood disasters on economic and social development and people's lives. It is reported that the insurance industry has paid more than 10 billion yuan in compensation to the flood-stricken areas, providing a unique guarantee for post-disaster reconstruction and resumption of work and production, and the sense of gain of the affected people has been continuously enhanced.
Expert commentary
Wei Li, Professor of the School of Finance of Renmin University of Chinese and Director of the Insurance Research Institute of China
China has a vast territory, complex and diverse geological and landforms, and frequent natural disasters, which have caused great threats to national property and people's lives. In the event of previous disasters, the insurance industry has actively supported disaster relief and post-disaster reconstruction, playing the role of economic shock absorber and social stabilizer. But at the same time, we should also see that due to the lack of a perfect catastrophe insurance system, the vast majority of the huge losses caused by these disasters are still borne by the people, which has a great impact on the national finances, and the people's awareness of disaster prevention and loss reduction is still weak. Therefore, China urgently needs to build a new national risk management system based on the construction of catastrophe insurance system, and encourage commercial insurance companies, capital markets and social forces to play a greater role in the development of disaster insurance.
Related Reports:
Three
The pilot of pension insurance has been steadily promotedContinue to do a good job in pension finance
* The financial work conference clearly pointed out that it is necessary to do a good job in pension finance and other big articles. Since 2023, the commercial pension business has been launched on a pilot basis, and 4 pension insurance companies have successively launched innovative productsExclusive commercial endowment insurance has been transformed from pilot business to normalized business;Life insurance and long-term care insurance liability conversion business was launched to meet the long-term care security needs of the people, especially the disabled elderly;In the past year, the personal pension pilot has been steadily promoted, and the personal pension insurance products have been continuously expanded to 99 products from more than 20 companies, covering exclusive commercial pension insurance, comprehensive insurance, annuity insurance, universal insurance and other types. At the same time, the insurance industry gives full play to the long-term stable capital management and risk protection functions, and provides management services for the preservation and appreciation of various pensions. In addition, to increase the layout of pension communities, Taikang Insurance, Chinese Life, Ping An of China, Dajia Insurance and other companies have added a number of pension community projects to provide people with richer pension options.
Expert commentary
Guo Jinlong, Director of the Research Center for Insurance and Economic Development, Chinese Academy of Social Sciences
The insurance industry can become a connector and resource integrator of the pension industry ecosystem, providing support and protection for the development of the pension industry by providing protection, reducing risks, promoting the development of the pension industry and enhancing consumer confidenceThrough the introduction of various pension financial products, we provide old-age security for the elderly, reduce the risks faced by the elderly, and reduce their financial pressureCarry out pension service business, provide various pension services for the elderly, such as pension care, medical services, etc. With the increase of China's elderly population, the role of the insurance industry in the pension finance will become more and more important, with insurance products as the carrier, to further expand and enrich the connotation and extension of insurance products and services, to provide customers with comprehensive services covering the whole life cycle, which is of great significance to solve the problem of pension for the elderly and improve the quality of life of the elderly.
Related Reports:
Four
The new regulations on insurance sales behavior have been implementedPromote consumer protection work in an orderly manner
From September 15, 2023 to October 15, 2023, the "2023 Financial Consumer Rights Protection Education and Publicity Month" was launched, with the theme of "Gathering Financial Strength for a Better Life", and carrying out various forms of education and publicity activities with rich content for financial consumers and investors. From June 30, the "Rules for Information Disclosure of Life Insurance Products with a Term of More than One Year" came into effect, continuously improving the transparency of insurance products and protecting the legitimate rights and interests of consumers. On September 28, the State Administration of Financial Supervision issued the "Measures for the Administration of Insurance Sales Behavior", which divides insurance sales behavior into three major links: pre-sale, in-sale and after-sale, and proposes clear provisions to better regulate insurance sales behavior, improve the professional ability and professionalism of insurance practitioners, and protect the legitimate rights and interests of insurance consumers more comprehensively while promoting the healthy development of the insurance industry.
Expert commentary
**Chen Hui, Director of China Actuarial Science and Technology Laboratory, University of Finance and Economics
In March 2023, the CCP** issued the Plan for Deepening the Reform of Party and State Institutions, which transferred the financial consumer protection responsibilities of the People's Bank of China and the investor protection responsibilities of the China Securities Regulatory Commission to the State Administration of Financial Regulation, which is responsible for the protection of financial consumer rights and interests. This indicates that the protection of the rights and interests of financial consumers in China has entered a new stage of development, and the protection of the rights and interests of financial consumers has become a solid cornerstone for maintaining social and economic order and stability and promoting the healthy development of the socialist market economy. In this context, the concept and system of insurance sales supervision need to be upgraded, and the Measures for the Administration of Insurance Sales Behavior, as a programmatic document for insurance sales, have identified the force of insurance consumer protection and standardized the pre-sale, in-sale and after-sale behaviors of insurance sales, which will continuously improve and optimize the construction of the system and mechanism for the protection of the rights and interests of insurance consumers, and promote the high-quality development of the protection of the rights and interests of insurance consumers.
Related Reports:
Five
Advocate the risk reduction service modelPromote the high-quality development of the property and casualty insurance industry
At the beginning of 2023, the former China Banking and Insurance Regulatory Commission issued the "Opinions on Actively Carrying Out Risk Reduction Services in the Property Insurance Industry", requiring the property insurance industry to take serving the people, the real economy and social stability as the starting point and foothold of risk reduction services, and actively assist insured enterprises to carry out risk reduction work for the purpose of reducing hidden risks and major risk damages. Risk reduction service is one of the effective means for the property insurance industry to serve the development of the real economy, which has a positive effect on improving the social anti-risk ability and reducing the cost of social risk. At present, various property insurance companies have changed their business ideas and models, broadened the scope of services, and actively provided risk reduction services in various property insurance businesses such as liability insurance, automobile insurance, and agricultural insurance, so as to provide customers with one-stop service solutions.
Expert commentary
Assistant Dean and Professor of the School of Insurance, University of International Economics
Risk reduction is key to the performance of insurance risk management functions. In the modern insurance system, as a professional institution that provides risk management services for the society, insurance companies provide risk reduction services for various families, all walks of life, institutions and organizations and departments is the basis for improving their core competitiveness, a means to reduce the operating costs of the industry, a weapon to enhance the image of the insurance industry, and an indispensable part of ensuring the sustainable and healthy development of the insurance industry. At the same time, in the process of providing risk reduction services to the society, the insurance industry will gradually expand the functions of the insurance industry, enhance the role of the insurance industry, and enhance the image of the insurance industry. Risk reduction service is also an important entry point for the insurance industry to implement the functions of the insurance industry's economic shock absorber and social stabilizer proposed by the first financial work conference.
Related Reports:
Six
The scheduled interest rate of life insurance was lowered and the "integration of newspaper and bank" was implementedTake precautionsSpread lossRisks
In August 2023, a number of life insurance companies completed the switch between the old and new products, and stopped selling the scheduled interest rate of 35% increase in whole life insurance and other products, and reduce the predetermined interest rate of ordinary life insurance to less than 3%. In recent years, the downward trend of market interest rates has been obvious, the volatility of the capital market has intensified, and the investment side has generally been under pressure. A predetermined interest rate reduction can control the overall cost of debt and reduce the risk of interest margin loss. In terms of expense management, in recent years, there has been a "discrepancious" situation in the life insurance industry, that is, the actual expenses exceed the level at the time of product filing. Since 2023, the regulatory authorities have issued a number of documents to life insurance companies, vigorously promoting the "integration of newspapers and banks", and taking the lead in launching in the bancassurance channel. In the fourth quarter, the vast majority of banks engaged in bancassurance business re-signed contracts with insurance companies, and preliminary estimates showed that the commission rate of the bancassurance channel decreased by 30% compared with the previous average.
Expert commentary
Zheng Wei, Dean of the Department of Risk Management and Insurance, School of Economics, Peking University
Life insurance operations usually focus on the "three differences": death difference, interest rate difference, and fee difference. In 2023, the life insurance industry will lower the predetermined interest rate and implement the "integration of newspaper and bank", which is of positive significance for preventing the risk of interest spread loss and fee spread loss. At the end of the 90s of the 20th century, with the continuous decline in bank interest rates and the successive bankruptcies of many life insurance companies in Japan due to interest rate losses, the risk of interest rate loss became one of the hot issues in the industry. In the current low-interest rate market environment, although the difference between the actual interest rate and the predetermined interest rate of life insurance products is not too large, because the life insurance industry is much larger than more than 20 years ago, the problem of asset-liability matching is more prominent. The implementation of the "integration of newspapers and banks" is of positive significance for rectifying market chaos and standardizing the order of competition on the one hand, and on the other hand, it is of positive significance for preventing the risk of loss of life insurance premiums.
Related Reports:
Seven
Contribute to the joint construction of the "Belt and Road".The insurance industry has provided high-level services, and has opened up to the outside world in depth and in a down-to-earth manner
2023 marks the 10th anniversary of the Belt and Road Initiative. Over the past decade, China's insurance industry has continued to optimize its overseas layout, continuously enrich financial products, and strive to provide financing support and insurance protection for the Belt and Road Initiative. As of the end of June 2023, 6 Chinese-funded insurance institutions have set up 15 overseas branches in 8 co-construction countriesThe Belt and Road Reinsurance Community has underwritten a total of 74 Belt and Road projects, protecting total overseas assets of RMB 57 billion. In June 2023, the "International Board" of reinsurance was launched, helping China's reinsurance market to transform and upgrade from "one-way opening" to "two-way opening", and further promoting the high-level opening up of reinsurance and high-quality "dual circulation". In October, the reinsurance "international board" ushered in the first batch of 15 institutions, forming a preliminary form of institutional agglomeration. In November, the State Administration of Financial Supervision approved the establishment of two foreign-funded insurance brokerage companies, BMW (China) and Angu Fangsheng, in Beijing, marking the deepening and breadth of the opening up of the insurance industry.
Expert commentary
Wei Li, Professor of the School of Finance of Renmin University of Chinese and Director of the Insurance Research Institute of China
Over the past 10 years since the Belt and Road Initiative was proposed, the insurance industry has continued to support the Belt and Road Initiative, and has achieved remarkable results. From overseas projects and projects to employee accidents and health, the Belt and Road Initiative has given rise to a large number of international insurance business needs, both in terms of overseas premium income and the scale of overseas investment. The international service level of China's insurance institutions has also been continuously improved with the development of business, and in line with business needs, insurance companies have continuously enriched and innovated insurance products, and continuously improved and optimized insurance service levels. The high level of opening up and internationalization is also an important indicator to measure the strength of a country's insurance market, and the insurance industry is also achieving a high level of opening up while serving a high level of opening up, and promoting China from a big insurance country to an insurance power.
Related Reports:
Eight
The disposal of the insurance institutions that have been taken over is progressing in an orderly mannerEffectively prevent and resolve risks and hidden dangers
In July 2020, the former China Banking and Insurance Regulatory Commission (CBIRC) took over Tianan Property Insurance, China Life Insurance, Tianan Life Insurance, and Yi'an Property Insurance in accordance with the law. Since 2023, the risk management work of these four institutions has ushered in new progress. In May, the former China Banking and Insurance Regulatory Commission approved BYD's transfer of 1 billion shares of Yi'an Property Insurance, with a shareholding ratio of 100%, and Yi'an Property Insurance was renamed BYD Property InsuranceIn June, Zhonghui Life Insurance and its branches were approved to open for business, undertaking Tianan Life's policy liabilities, effective assets and all institutional outlets in accordance with the law, and fully fulfilling the obligations of the insurance contract. In July, Ruizhong Life Insurance and its branches were approved to commence business, undertaking the policy liabilities, effective assets and all institutional outlets of China Life in accordance with the law, and fully fulfilling the obligations of the insurance contract. In September, Shenergy P&C Insurance was approved for construction, marking an important step in the restructuring of Tianan P&C Insurance.
Expert commentary
Guo Jinlong, Director of the Research Center for Insurance and Economic Development, Chinese Academy of Social Sciences
* The Financial Work Conference emphasized that it is necessary to comprehensively strengthen financial supervision and effectively prevent and resolve financial risks. In recent years, the regulatory authorities have continuously strengthened the prevention and resolution of risks of key insurance companies, on the one hand, to promote the risk disposal of high-risk institutions in a steady and orderly manner. Innovate the disposal model, establish a special working mechanism for risk disposal, set up a special class or task force to promote the risk resolution of high-risk institutions, promote the implementation of local responsibilities, and formulate risk disposal plans. Implement close supervision of high-risk institutions to prevent risks and hidden dangers such as liquidity and stakeholder incidents. On the other hand, for insurance companies whose solvency does not meet the standards and there are signs of solvency risks, they will promptly adopt various methods such as regulatory interviews, risk warnings, and on-site supervision to urge the companies to take effective measures to improve their solvency. The disposal of the taken over insurance institutions has been carried out in an orderly manner, effectively preventing and resolving hidden risks, and effectively protecting the legitimate rights and interests of insurance consumers and all relevant parties.
Related Reports:
Nine
The insurance asset management industry has been professionally operated for 20 yearsThe use of insurance funds has achieved remarkable results
Since the establishment of PICC Asset Management, the first insurance asset management company in 2003, China's insurance asset management industry has developed rapidly in the past 20 years, with continuous expansion of market influence and continuous improvement of professional investment capabilities. At present, there are 34 insurance asset management companies, with assets under management of 27 trillion yuan, and it has become one of the largest institutional investors in China's bond market and market, playing a role in the stable operation of China's macroeconomic economy and the healthy development of the financial market. Over the past 20 years, the scope of insurance funds has been gradually expanded, and insurance asset management companies have become mainstream financial institutions with the most abundant investable asset classes in China, and insurance asset management products have become an important way to serve the national strategy and the real economy. According to the data, as of the end of July 2023, the scale of investment and financing of insurance funds to serve the real economy has exceeded 24 trillion yuan.
Expert commentary
Assistant Dean and Professor of the School of Insurance, University of International Economics
Thanks to the rapid development and profound accumulation of China's insurance industry over the past decades, insurance asset management companies have gained rich soil in the growth of specialization, and have made great progress in both quantity and quality. After nearly 20 years of development, insurance asset management companies have accumulated rich experience in long-term fund management, large-scale asset allocation, long-term asset creation and absolute return acquisition, and have become the core managers of long-term funds such as insurance funds, major institutional investors in the capital market and an important force in serving the real economy. On the list of "Top 500 Global Asset Management Institutions in 2023" released by the international financial ** "European Pension and Investment", a total of 41 financial institutions in China are on the list, including 10 insurance asset management companies.
Related Reports:
Ten
Improve the actuarial professional training systemThe Actuary Qualification Examination opens
Actuarial science is the core technology of insurance operation. On July 17, 2023, the State Administration of Financial Supervision and the Ministry of Human Resources and Social Security issued the Regulations on the Professional Qualification of Actuaries and the Implementation Measures for the Professional Qualification Examination for Actuaries, which optimized the registration conditions, professional categories and examination subjects of the actuarial professional qualification examination, and committed to building an actuary professional qualification management and examination system with Chinese characteristics. From October 21st to 25th, the 2023 Actuary Professional Qualification Examination was held simultaneously in 9 cities including Beijing, Shanghai, and Tianjin, and more than 5,000 candidates across the country applied for the exam. This is the first examination for actuaries after being included in the National Vocational Qualification Catalogue, which will effectively promote the construction of actuarial talents and the development of actuarial careers in China to a new stage.
Expert commentary
**Chen Hui, Director of China Actuarial Science and Technology Laboratory, University of Finance and Economics
The origin and development of the actuarial profession in China was born in response to the development requirements of China's insurance industry. At present, China's insurance industry is in a new stage of development, and the task of promoting China's transformation from an insurance country to an insurance power is arduous, which urgently requires more actuarial talents to play a professional role. In addition, the risks faced by China's economic and social development have begun to show the characteristics of complexity and diversity, and in order to promote the insurance industry to actively participate in national risk governance, it is also necessary to play the professional role of actuaries. Since 1693, when Edmond Halley compiled the first life table, actuaries have been committed to human risk management, by turning the non-numerical into the numerical, the unquantifiable into the quantitative, and the non-modelable into a model, and then turning the uninsurable into an insurable risk, controlling the high-risk risk into a low-risk risk, and transforming unsustainable behaviors and processes in a more sustainable direction.
Related Reports:
Reporter Zhu Yanxia, Fang Wenbin, Yang Yumeng, Tan Lezhi.
Edited by Li Mengxi.
Intern Li Haochen.
Visual Zhang Fan.