Insurance Industry
With a large population, fast and rapid growing economy and constant improvement of its people’s living standard, the insurance industry in China thus enjoys tremendous market potentials. The Chinese insurance industry, starting from quite a low terrace, developed in a slow pace. 20 years since the reform and opening up witnessed the true and great development of the insurance industry.
However, it is still at its preliminary stage of development now with a relatively small size. The intensity and depth of the insurance industry has a large gap comparing to the average world level. Entering the 90’s, the Chinese insurance market initiated a limited opening up to the outside world with Shanghai and Guangzhou as the experimental beds in 1992. By the end of 1999, there are totally 26 insurance institutions for the whole insurance industry of China. Among them, 13 Chinese-solely-funded insurance companies, 9 foreign-funded insurance companies and 4 joint ventures. The year of 1998 saw the insurance revenue of the Chinese insurance industry at 127.35 billion RMB Yuan, the 16th in the world, with insurance coverage intensity of 1.57 percent and the 77th in the world; and insurance coverage depth of 100 RMB Yuan, the 66th in the world.
Thanks to the deepening reform and effort of the policy implementation of expanding the social security industry, the insurance industry of China will enjoy a faster and speedy growth. According to an estimate made by the China Insurance Supervisory Commission, the growing rate of the market size of China’s insurance industry will arrive at an annual average of 12 per cent in the coming 5 years, and the insurance revenue will reach 280 billion RMB Yuan by the end of 2005, with insurance coverage intensity of 2.3 per cent, and insurance coverage depth of 230 RMB Yuan.