The State Council decided to make the following amendments to the "motor vehicle traffic accident liability compulsory insurance Ordinance": 

    Article fifth the first paragraph:"The insurance company approved by the CIRC, can be engaged in the business of compulsory motor vehicle liability insurance."

      This decision since2012Years5Month1The date of promulgation.
    "Motor vehicle traffic accident liability compulsory insurance regulations" shall be amended according to this decision, and be re promulgated.

      Revision of the regulations, symbolized our country formally to the foreign insurance companies open cross strong insurance market, the insurance industry to enter the China overall open stage.

　　Cross strong insurance market to foreign open door

The full name is "compulsory insurance of motor vehicle traffic accident liability compulsory insurance", refers to the insurance company to the insured motor vehicle road traffic accidents caused by the victim (not including the vehicle and the insured) casualties, property losses, shall be compulsory liability insurance compensation within the limit of liability, since 2006 formally implemented. This is China mainland first implemented by the state laws and regulations of the compulsory insurance system.

Because of Chinese join WTO not promised to allow Foreign capital company to operate the compulsory insurance business, Foreign capital company has been blocked in the cross strong insurance business outside the door.

In our country, the auto insurance business including compulsory insurance and commercial insurance two pieces. The owner may be compulsory insurance and commercial insurance purchased separately, but the trouble degree claims people and step back, "buy a house" has become the preferred owners purchase insurance, thus formed the compulsory insurance and commercial insurance bundled sales situation.

As the only commercial insurance, foreign insurance companies in China have to adopt the cooperation, and local counterparts are insured, curve into the market, but the high cost, limited, cumbersome procedures, the Foreign capital company in the mainland of China insurance market development difficult, potentially a lot less potential customers.

It is reported, at present the foreign insurance companies in China 21. Because the compulsory insurance business has not been liberalized, currently only a few commercial insurance business.

Limited cross strong insurance coverage, the insurance company directly affects the development scale of foreign investment. The China Insurance Regulatory Commission data show, as of the end of last year, the insurance companies with foreign insurance premium income of 5200000000 yuan, only the total insurance premium income of the company's 1.1%.

In 2010 the domestic cross strong insurance premium income of 84050000000 yuan. The expert points out, the insurance company of foreign capital into China cross strong insurance market, favorable to expand its market share in china.

　　To Chinese commercial insurance market

Many foreign insurance companies surveyed said, doing all the preparation, test cross strong insurance market.

But in fact, cross strong insurance operations since the implementation is not optimistic. In 2011 August, cross strong insurance fourth annual report released in 2010 the China Insurance Regulatory Commission, 33 property insurance companies operate cross strong insurance, business losses of up to 7200000000 yuan.

This appears to be a loss of the sale, why will cause foreign interest? Insurance company of foreign capital are more valued insurance to pay strong behind the commercial insurance this cake.

"Only with the sale of insurance to pay strong qualification, can we truly enter the auto insurance market, business stand on one's own, sharing of commercial insurance." A Foreign capital company responsible person said.

In fact, the insurance of insurance market size of about 70% of property insurance company, has been the biggest business revenue and profit source. Although the compulsory insurance is a deficit, but with the commercial insurance strapped up, in fact, the insurance company is to make money.

The China Insurance Regulatory Commission data show, in 2011 China's property insurance business benefit from commercial insurance continued "awesome", the annual premium income 461800000000 yuan, grow 18.5% compared to the same period, premium growth and profitability have reached historic highs.

Cross strong insurance to make positive contribution to the rise in recent years commercial auto insurance rate. Since the implementation of compulsory insurance, motor vehicle insurance rate increased from 2005 at the end of 36% to 2010 at the end of 49%, the auto insurance rate increased from 58% to 79%.

　　Short term domestic insurance market pattern change

Let go of cross strong insurance market will impact on Chinese funded insurance companies?Cross strong insurance to open to the outside world, the short term will not have a greater impact on the market, because the insurance sales mainly to see the channels and networks, networks less foreign insurance companies, network layout is very difficult to increase rapidly in a short time.

"Currently on the market leading insurance companies such as life insurance, Ping An, Taibao with strong marketing and service network, basically not affected, but the small and medium-sized company or will have a serious impact."　　  In addition, in the domestic auto insurance business operations, need experience and data support, and at present the foreign companies in China only a few commercial insurance business, lack of experience and data.

A foreign insurance company responsible person said, foreign insurance enterprises and Chinese funded insurance enterprise strategy and the competitive advantage, the advantage of foreign insurance enterprises operating high-end customer markets, not blindly in the auto insurance market share of crazy chase.

　　Multiple competitive power of insurance service upgrade

For Chinese consumers, entry of foreign insurance enterprises means more choice.

"These years it was tedious insurance get scared, if the Foreign capital company can be better than the local enterprises in the efficiency and service, even if the price was a little higher, will also consider foreign cross strong insurance products." The owner Mr. Feng said.

In the Chinese funded insurance companies dominate the auto insurance market, "claims to" has been praised by the majority of owners criticized. In the absence of effective competition in the market environment, the lack of insurance companies to improve service quality and strengthen the motive force and pressure product innovation.

Experts think, bring in advanced management experience, technology at the same time, on the whole insurance market, the positive role of the entry of foreign capital is more through the full competition to promote this market service upgrade.