This paper mainly investigates the impact of nontraditional investment business developed by property insurance companies on operation efficiency.Firstly,this paper uses a theoretical model to interpret the relation between insurance investment function and risk pooling&losses compensation and also firm operation efficiency.Secondly,based on the panel data of China's 44 property insurance companies during the period from 2009 to 2013,it makes an empirical study and finds that owing to scale economy and cross-subsidy effects,the development of investment business significantly affects cost efficiency of property insurance companies.And due to low ratio of investment income to total income and limited investment ratio,the effect of the development of investment business on profit efficiency is uncertain in terms of direction and not significant.These conclusions are also robust in sub-sample regression analysis and after the control of possible endogeneity and nonlinear effects of scale variables.It suggests that regulation authorities should give up mandatory indicators like investment ratio step by step,pay more attention to capital control and solvency regulation,and raise regulation flexibility.