Insurance Blog

(A) insurance business setbacks

Early ’50s, the Chinese People’s Insurance Company across agencies in the implementation of policies and specific practices and a lot of problems, mainly relying on administrative orders for the business, internal management is chaotic. Pilot experience in agricultural insurance in the case of a very immature comprehensive promotion, a number of grassroots cadres to carry out business and issue compulsory orders, adversely affect the masses. Insurance agency is developing too fast, and many cadres do not understand business, but only to the number of premium quality does not seek insurance contracts, a number of county-level companies make ends meet. In March 1953, the Chinese People’s Insurance Company Third National Insurance Working Conference and deviation of these errors were corrected to determine the “finishing city of business, suspended operations in rural areas, reshaping institutions, in the consolidation of steady progress on the basis of” principle.

To the end of 1953, closed around the basic agricultural insurance. On the closed agriculture and insurance, although most had no opinion, but some farmers do not want closed down and surrender of them have had some money or some understanding of the benefits of insurance. Because of the rural economy in most parts of the Northeast and Co-operative movement has developed rapidly vast majority of farmers do not agree to cease operation of agricultural insurance. Financial and Economic Committee for approval by the Government Administration Council, the Northeast region to re-apply for the insurance of farm animals. With the accelerated pace of agricultural co-operation, organized farmers produced a certain demand for agricultural insurance. However, with the socio-economic development of agricultural co-operatives from primary to senior community, livestock owned by the public and uniform use of the demand for insurance than the primary anti-social urgency.

Since 1953, the state compulsory insurance business in the city has made an adjustment: (1) closed state organs, the compulsory insurance of property and infrastructure sites compulsory insurance; (2) State-owned enterprises (including cooperatives) will continue to apply for compulsory insurance; (3) other businesses, according to whether the positive effect on production, the masses need and voluntary, they have unconditional and whether it meets the four principles of economic accounting, is divided into consolidation, contraction, closure of three types of clean up. As the advance of the socialist transformation of capitalist industry and commerce, urban voluntary insurance has declined markedly.

(B) The suspension of the domestic insurance business

In October 1958, Xi’an, China finance and trade conference pointed out: people’s communes, the insurance role of the work has disappeared, with the exception of foreign insurance business must continue to apply, the domestic insurance business should be immediately discontinued. In the same year in December, held in Wuhan, the official National Financial Conference to make “immediate closure of the domestic insurance business” decision. In January 1959, the Chinese People’s Insurance Company held its seventh national insurance work conference, and implement the spirit of the closure of the domestic insurance business, and the deployment of the aftermath clean-up. From 1959 onwards, the country’s domestic insurance business in addition to Shanghai, Harbin and other places continue to maintain for some time, but all the other places closed.

Suspension of domestic insurance business, industry and commerce in the cities and towns to complete the socialist transformation and the rural people’s communes hair situation to arise. Some people think that industry and commerce in cities and towns were basically the case of state-owned enterprises, the state can regulate the financial means to compensate for a variety of disaster losses, so the need for start-up city insurance is not. While in rural areas, people’s communes has changed in the past that a smaller scale, operating the project the status of a single agricultural cooperatives, their financial and material resources already have greater resilience and ability to compensate. Dominated by this understanding that the historical task of the insurance had been completed.

Upon closure of the domestic insurance business, the state agencies to consider from the streamline, but the Board consists of foreign operations in the People’s Bank Insurance Department, responsible for handling import and export of the central and insurance business in Beijing, leading domestic and foreign branches of business and engaging in, centralized processing the international reinsurance business and external activities in the outside business with the “Chinese People’s Insurance Company”, “China’s insurance companies” and “Tai Ping Insurance Company,” the name of the three companies.

In 1959, some cities in the domestic insurance business is not completely closed, including Shanghai, Harbin, Guangzhou, Tianjin and other places. In 1964, with the overall improvement in the national economy, the People’s Bank Business Bureau Insurance Service upgraded the foreign bureau a unit of foreign insurance companies are still using the name of the Chinese people by the part-time general manager, vice president of the People’s Bank.

From 1966 to 1976 ten years of chaos during the period, China’s domestic insurance business completely closed. In the “Left” thinking under the influence of the insurance is considered “private market economy,” “not suited China’s socialist economic base,” “handle an international reinsurance business more harm than good”, “is to rely on imperialism,” “re-insurance is Emperor repair redistribution of profits among the anti-”and so on, so it was suggested to be” thoroughly smash China’s insurance industry “, not only closed the domestic insurance business, but also suspended all foreign-related insurance and international reinsurance business. Clear bear the brunt of the 1969 Ministry of Communications in January closed a ocean-going vessels, insurance, overseas business has been greatly affected. And then discontinued the motor vehicle third party liability insurance. 1968, before the overseas business people from Hong Kong to an insurance company, China Insurance, Pacific Insurance Company distributed to the Chinese People’s Insurance Company, and then by the Chinese People’s Insurance Company’s external reinsurance unity. However, in 1969, the overseas business of foreign reinsurance by CAS Insurance agents, life insurance companies reinsure from China, Hong Kong, Macao, Singapore and other countries and regions into the insurance business under the management of the Hong Kong branch of China Insurance Company. By 1969, China has re-insurance relationship with the countries from the original 32 dropped to 17, have business dealings of the company from 67 down to 20, only with the socialist countries and the relationship between individual developing countries to maintain reinsurance. Actually stopped the years of development together with the West of the insurance market reinsurance transactions.