Motor vehicle insurance is the pillar of property insurance, especially since 2006, with the implementation of compulsory insurance system, the coverage of auto insurance has been further expanded, and its premium income has been maintained at about 70% of property insurance premium income. Specifically,
First, auto insurance premium income grew rapidly, which was significantly higher than the overall growth rate of property insurance. In 2006, the contribution rate of auto insurance to property insurance reached 84.33%. The main growth point of motor vehicle insurance premium income is the premium income of compulsory insurance;
Second, the market share of auto insurance is also very high. In property insurance premium income, auto insurance income occupies an important position, and the top four companies with high property insurance market share all account for more than 60%, and some of them reach more than 90%. The year-on-year growth rate of auto insurance business is also obvious, and the operating benefit of motor vehicle insurance determines the benefit of the entire property insurance market;
Third, the profitability of auto insurance needs to be further improved. Compared with the scale and upward trend of auto insurance business, the operating benefit of auto insurance is not optimistic. Of course, this has a lot to do with the high level of compulsory insurance and motor vehicle insurance in payout ratio, but in the final analysis, it is still a matter of management ability. How its management ability will directly affect the development of property insurance and non-life insurance industries; Fourth, the average car premium is low and the underwriting risk increases.
On the basis of ensuring the scale of auto insurance business, how to further improve the profitability of auto insurance business has become the focus of attention of various insurance companies.
Second, the main problems in the management of auto insurance
(1) Connection of products and marketing methods There is little difference between the auto insurance products and marketing methods of insurance companies. Responsibility mode of clauses
The combination of hedging and additional risks is similar to the text structure, the marketing methods are the same, the market positioning and market segmentation have no own characteristics and lack of mature planning. This leads to their similar competitive cost structure. As China is a human society, this tradition will inevitably penetrate into the insurance industry. Most companies still rely on relationships in the basic strategy of auto insurance marketing, and a business leader can easily become the target of many insurance salesmen.
Because the insurance products provided by each company are not very different, the internal gold content is roughly the same, the external services are basically similar, and the calculated rates are not very different, so the insurance direction is determined by the relationship and has become a natural choice in reality. It is under this traditional marketing mechanism that some newly established companies can't expand their customer base compared with the old companies with a long history because the social network has not been established, which is why many insurance companies are still at a low level even after several years of operation. This also shows that it is difficult to win a competitive advantage by traditional methods, especially for new companies. Insurance companies must re-examine their product development strategies and marketing methods, innovate management, products and services around the central task of improving auto insurance management ability, and establish a product line that is more responsive to public demand and a more flexible business based on customer interests.
(B) the high cost of competition
The competitive cost of insurance companies is mainly reflected in high fees, fee reduction competition and loose claims. First of all, high agency fees and various returns increase the cost of competition. Some companies get insurance premiums by paying high fees to insurance intermediaries, while others expand their business agents by expanding their marketing teams on a large scale and expand their business by paying salaries and high fees, which also increases their expenses. As a result, the absolute amount of motor vehicle insurance premium increases, the relative amount decreases and the profit decreases. The interests of consumers and insurance companies are damaged, the allocation of resources in the whole society is distorted, and the operating costs of insurance companies are increased. Especially after a large number of new companies enter the market, in order to compete for business, the price is getting bigger and bigger and the cost is getting higher and higher. It is an important way for insurance companies to entrust an agency to sell auto insurance products, but in this case, many insurance companies can easily find the same agency to sell their products, which will objectively stimulate the desire of this agency and give it more room to raise prices, which will undoubtedly increase the cost of competition. Some insurance companies pay 30%-50% commission to professional agencies. On the premise that the profit margin of automobile distribution is small, many automobile dealers artificially reduce the profit margin of automobile distribution in order to complete the sales task, and then earn compressed profits by selling insurance. However, the auto insurance payout ratio of insurance companies has been very high, generally above 40%, sometimes reaching 60% or even 70%, and it is still rising. At this level of fees and refunds, it is easy to lose money.
The second is the fee reduction brought about by vicious competition. It has become the choice of many customers to insure vehicle insurance by bidding. As the market price war intensifies, some companies pay more attention to the development speed rather than the internal quality of their business, reduce the underwriting rate of violations, and bid at any cost. As long as quantity is not quality, underwriting is lax, and benefits are used for scale, resulting in reduced premiums and increased risks. Once there is a risk, there may be losses.
Third, as a means of competition, loose claims increase the cost. Claim is a way of service. Once used as a means of competition, it will inevitably lead to a substantial increase in the level of compensation, and the difficulty of controlling the claim moisture will also increase accordingly. Insurance companies will have to bear more compensation costs and management costs than before. High expense rate, high payout ratio and low premium rate make it more and more difficult for insurance companies to make profits. In the real environment, it is a commercial way that consumers and distributors must abide by in the competition. The cost of profit must be absorbed by improving productivity and increasing sales scale. This puts forward objective requirements for insurance companies to reform their own management methods.
(C) high risk of auto insurance claims
Payout ratio's auto insurance indemnity expenditure is too high, and the pressure on auto insurance operating efficiency is great. First, as more and more cars enter ordinary families, traffic accidents also increase, and the growth rate of effective reports and claims is constantly refreshing. In 2008, PICC P&C Company handled more than 1 10,000 claims per month on average, and the accident rate showed an upward trend. Second, the three major liability insurance claims and lawsuits involving personal injury cases continue to rise, and the proportion of compensation in personal injury cases increases year by year, and the average amount of compensation per case remains high. Third, the control of key links in claims is not strict enough, the on-site survey process is extensive, the claims management methods are backward, and the quality of some claims personnel is not high, which leads to poor quality and high water content of auto insurance claims of many property insurance companies. Fourth, insurance fraud continues to spread and moral hazard tends to spread. Cases such as insurance fraud, harming others and benefiting themselves occur from time to time.
Further reading: How to buy insurance, which is good, and teach you how to avoid these "pits" of insurance.