Present Potential Of China's Insurance Industry

Insurance

Monday, 29 June 2009 23:47

Beginning in 1980, China's insurance market grew at an average rate of 26%, reaching RMB159 billion (US$19.2 billion) by the year 2000.The growth rate of insurance premiums is projected, reaching RMB 280 billion (US$33.7 billion) by the current year 2005.

According to the report in 2000, the Chinese insurance density (premiums per capita) was RMB127 (US$15.30) in contrast to the world average of US$ 360.China's percapita spending on Insurance is very fast in the recent years.

For the year 1996 China's Economy reforms was young which led Chinese per capita spending on insurance to US$ 7.64 in comparison to tin aged Economic reforms of India at US$1.7.

Conclusion

Given that China's economy has grown near about 8% per year since 1979.Most foreign investors including those in the insurance sector do not want to be left out of the most rapidly expanding and largest potential insurance market in the world.

China's insurance industry has made rapid advances after opening of the market to FDI. Presently as a result of WTO negotiations, China has agreed to completely open its financial services market, including insurance. The WTO accession has stimulated much additional Chinese reform activity to prepare China's domestic insurance market for vastly increased foreign participation and competition.