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China's Insurance Industry Meets Challenges
As China's entry into the WTO approaches, the country's insurance sector will face fierce competition from its overseas counterparts, according to industry insiders.
China's insurance businesses are run by more than twenty insurance companies including state-owned, share-holding as well as joint-ventures.
The sector's total assets has reached 230 billion yuan, and annual insurance premiums have exceeded 120 billion yuan, a rise of 270 times compared with 1980.
China's insurance companies used to get their business mainly from state-owned enterprises, but now they have turned to family insurance.
There are now tens of thousands of people engaged in family insurance marketing which is now viewed as the foundation of China 's insurance.
According to Lu Sheng, an official of the insurance company in Jilin Province, China will shift its focus from group insurance to family insurance.
The Chinese government will allow more room to develop the insurance market. Approved by the State Council, insurance capital can be used to buy and sell securities. The China Life Insurance Co. is now leading the sector in this regard.
Lu said that incentives should be introduced to increase efficiency.
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