<p align="justify">China Life Insurance is a 70% state-owned insurance service and annuity products&#8217; provider based in Beijing, China. ; The company collected revenue of RMB812.53 billion in 2017 with a slight increment as compared to 2016. ; China Life Insurance is positioned at 94 in &#8220;The Fortune Global 500&#8221; and it is considered one of the strongest brands in the world (China Life Insurance, 2019). ; The company is the biggest life insurance company in China but to be successful on a continuous and long term basis, the company needs to evaluate the business and industrial environment. Porter&#8217;s five forces analysis is presented to provide the industry attractiveness to make future decisions
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<h2 align="justify">Competitive Rivalry</h2>
<p align="justify">The insurance market of China is growing at a fast rate of 21% in 2017 which is the highest in the world (Atlas Magazine, 2018). The industry is booming in China while the rate is declining in the developed countries. There are several major players competing in the market that mainly includes China Pacific Life insurance, Ping An Life Insurance, Anbang Life Insurance and China Life Insurance with the market shares of 5.6%, 13.2%, 9%, and 18.7% respectively. The presence of local Chinese firms is high in the industry but like the banking industry, the government supports the local insurance companies and creates difficulties for foreign companies (S&;P Global, 2018). This decreases the level of competitors for the Chinese insurance firms in the market. Along with the lack of significance of foreign players, the industry growth of 21% also reduces the intensity of competitors despite the increasing number of companies. Chinese local companies are prospering continuously and increasing their revenues continuously. Therefore, the competition in the Chinese insurance industry is moderate.
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<h2 align="justify">The Threat of New Entrants</h2>
<p align="justify">The government of China supports the local companies to enter the market and creates hurdles for foreign players to keep the situation favorable for the local companies. This puts massive hurdles in the way of foreign companies to enter into the industry. The insurance company is highly reluctant to fraud and corruption and the government has made strict rules and regulations to protect the fraud. The strict regulation comes in the way of new entrants and becomes hurdle as it is not easy for any company to fulfill the legal requirements. The startup of an insurance company also requires the capital along with massive efforts to attract the customers. But the exceptional growth of the market convinces the investors and company to put efforts to fulfill the regulatory requirements and enters into the market (S&;P Global, 2018). Therefore, keeping in view the mixed situation, the threat of new entrants in the insurance industry of China is moderate.
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<h2 align="justify">Threat of Substitutes</h2>
<p align="justify">The trend of insurance services is increasing especially in developing regions like China. The 21 % growth on a continuous basis shows the strength of the insurance services in the country. The decline of insurance service in developed countries is not because of any substitute but it is due to penetration of the insurance services from the last 3-4 decades. There is no likely substitute for insurance services in the near future that increases the attractiveness of the industry by keeping the threat of substitute at a lower level.
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<h2 align="justify">Bargaining Power of Buyers</h2>
<p align="justify">There are multiple options for buyers when it comes to taking life insurance services. There are at least 25 significant insurers in the country according to a report by S&;P Global (2018). Even though the number of buyers is exceptionally high but due to the presence of multiple options, the buyers can switch easily and bargain strongly with the insurance company. This strength and easy switching of buyers increase their bargaining power in the industry of insurance in China.
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<h2 align="justify">Bargaining of Suppliers</h2>
<p align="justify">The experts of the insurance field and the premiums by the customers are the most important supplies of the company (SimconBlog, 2015). The customers already understand the value of their deposit and bargain with strength. The country&#8217;s economy is in the developing zone and the people are looking for jobs every time. The companies hire experts or people that lack expertise and train them according to the needs of customers. Due to a high collection of revenues and profits, it is not a big deal for the companies to invest in the training and development of the companies. Therefore, the bargaining power of supplier is moderate.</p>
<h2 align="justify">References </h2>
<p>Atlas Magazine. ; (2018). China insurance industry in figures 1980-2017. Available at: <a href="https://www.atlas-mag.net/en/article/the-chinese-insurance-market-in-figures-1980-2017">https://www.atlas-mag.net/en/article/the-chinese-insurance-market-in-figures-1980-2017</a><br />
China Life Insurance. (2019). About Us. Available at: <a href="https://www.chinalife.com.cn/yw/index/index.html">https://www.chinalife.com.cn/yw/index/index.html</a><br />
S&;P Global. (2018). China’s Top 25 Insurers. Available at: <a href="https://www.spratings.com/documents/20184/0/China%27s+Top+25+Insurers/5f4d65c5-130c-4027-83dd-dd3eec5b8796">https://www.spratings.com/documents/20184/0/China%27s+Top+25+Insurers/5f4d65c5-130c-4027-83dd-dd3eec5b8796</a><br />
SimconBlog. (2015). Insurance Industry analysis. Available at: <a href="https://simconblog.wordpress.com/2015/08/19/insurance-industry-analysis/">https://simconblog.wordpress.com/2015/08/19/insurance-industry-analysis/</a></p>