The Consistency Analysis between Protection Ability and Solvency Regulation of Nonlife Insurance in China

Insurance Protection Ability is the core in this article. The index of protection ability for each insurance company is got basing on multi-index comprehensive assessment model of protection ability for nonlife insurance company. Then regression analysis are made for some many times between index of protection ability and solvency margin, even with the detailed index for different level of solvency margin. All research results are showed that, the solvency regulation is run counter to the guide of protection ability, especially for C-ROSS, which is the core in the Chinese insurance regulation system. Those nonlife insurance company which has a little higher protection ability need more minimum capitals and has a little lower solvency margin. Such solvency regulation system would not only stop nonlife insurance company improving their protection ability, but also make them confused about the development direction. From the detailed regression analysis step by step, the deep reason are found. C-ROSS was oriented by risk only, while it didn't take the different importance between insurance business and investment business into account. Then, some suggestions are provided in order to reform and adjust C-ROSS system. For example, we can distribute some weights to different risk and different risk capital according with their tightness with insurance business. The weight is a little low if the risk or debt has a strong tightness relationship with insurance business, and the weight is a little high if the capital has a strong tightness relationship with insurance business, So that, C-ROSS would keep the same direction with protection ability regulation. It would play a more important role in the "releasing the front and focusing the end" regulation system, and accelerate insurance companies returning back to protection.