Slower growth
China's seven largest life insurers all recorded slower premium income growth in October, the Shanghai Securities News said last week citing an internal document.
Weak sales will force branches of life insurers to spare no effort in pursuit of new business if annual targets are to be met, the newspaper said.
"Changes must be made in how insurance companies are assessed in order to improve the industry's image and guide insurers back to their main mission," said Hao Yansu, an insurance professor of the Central University of Finance and Economics. "They should be assessed both in terms of economic performance and in terms of their performance of social responsibilities."
He said income from depositary products should be strictly excluded from premium income statistics and the regulator should assess the industry not by the total assets but by how much healthcare and accident coverage insurers have provided the public.
If capital markets where insurers park their money remain weak, the industry will be forced to develop more profitable products.
"The horrible thing is that insurers failed to change their business strategy amid a weak market in the past few years and continued to be obsessed with developing wealth management products," Hao said. "That is a vicious circle."
The insurance regulator last week issued rules that will tighten inspection over the behavior of insurance agents, starting next year. Agencies will be punished for misleading consumers, and sales executives may be sacked if serious violations are detected.
Hao said he hopes the tighter regulations will nurture more third party agencies and professional insurance brokers to assist in the transformation of China's insurance industry.
Landmark building should respect the public's feeling
Feedback
RSS
