PICC president Wang Cheng Yin: exchange rate risk huge losses

Chinese People's Property Insurance Company, Wang, president of the Bank into the 21st century the Asian financial year at the meeting said that the Chinese non-life insurance companies operating risk, pricing risk, investment risk, catastrophic risk, the risk of five major financial risk at a cost of cost control has become an insurance company in the future To guard against risks, improve profitability and competitiveness of the important work.

He said that as of the end of Sept., Chinese non-life insurance company assets shrink at least 17.5 billion, equivalent to the beginning of the total assets of 4.5%. Capital markets revenue of chance and uncertainty makes over-reliance on investment income of insurance companies are facing a very big risk of the use of funds. Non-life insurance industry in an integrated operation to speed up the process of globalization and against the backdrop of the insurance funds to gradually broaden investment channels, increased investment, more sources of investment risk, faster delivery, the greater the impact, if not handled properly, are likely to evolve into Systemic risk, which is specialized insurance companies to invest a higher demand.

Non-life insurance companies faced with another major risk for financial risk. He said that as of November 27, the fourth time this year the central bank to lower interest rates, creating the largest decline in 11 years, the frequent adjustment of the interest of insurance funds to match assets and liabilities of a higher demand at the same time, China's insurance foreign exchange asset size Has expanded each year and the beginning of this year, the insurance industry in China and Hong Kong dollar assets for a total of 21,510,000,000 U.S. dollars, increasing appreciation of the RMB against the U.S. dollar resulted in foreign currency assets of insurance companies continued to shrink, the huge exchange rate losses.

He said that the cost of cost control has become in the future to guard against the risk of insurance companies to enhance profitability and competitiveness of the important work. Insurance prices, including the risk of price and net operating expenses in two parts, improper control of operating expenses, or malicious in order to seize the market to raise the cost of inputs, is bound to seriously damage the company's risk tolerance, leading to lack of solvency.