Reporting System Adopted for 90% of All New Insurance Products

The Insurance Bureau of the Financial Supervisory Commission has announced a major relaxation of examination rules for new forms of life and personal property insurance, effective Sept. 1, under which 90% of the new forms of insurance can be sold without prior approval so long as they are reported to the FSC within 15 days of being put on the market. Prior application and approval continues to be required for the remaining 10%, and for other designated forms of insurance; in this case, the authorities are required to either approve or reject applications within 90 working days of receiving them. This relaxation will encourage insurance companies to offer innovative insurance policies and take timely advantage of market opportunities, thereby creating a better environment for the insurance business.

The Insurance Bureau indicates that if the new relaxation goes smoothly, it may expand the prior-approval exemption to encompass all new forms of insurance. It emphasizes, however, that to protect the interests of consumers it will carry out strict random examinations of new forms of insurance that are reported to it. Violators will be punished by a suspension of the right to report or apply for new forms of insurance for up to one year.

Regarding the new and especially designated forms of insurance for which prior approval is still required, under the draft “Determination Standards for New Forms of Life Insurance Products” and “Determination Standards for New Forms of Personal Property Insurance” formulated by the Life Insurance Association of the ROC, these new forms will include structured bonds that are new on the market, conventional and investment-linked insurance products that are first issued by an individual insurance company, and are non NT dollar-denominated.
(news source: http://www.cedi.cepd.gov.tw)