The Committee welcomes the continued liberalization and innovation of Taiwan’s insurance industry, which has played a significant role in improving public access to insurance protection and enhancing the convenience of insurance services, all while upholding sound risk management practices.

In this year’s White Paper, we express support for further easing regulatory restrictions on e-commerce to promote digital development in insurance distribution. At the same time, the procedural complexities associated with trial business applications require attention. To better support inclusive finance, we recommend that the authorities consider simplifying the approval process for trial operations to enhance efficiency and innovation in product development.

Furthermore, we recommend that the review and approval mechanism for cash dividend distributions of life insurers return to the framework stipulated under the Company Act and Insurance Act. This adjustment would reflect the industry’s improved capital position and align administrative practices with the current regulatory and financial landscape.

The Committee sincerely appreciates the government’s sustained efforts to promote a healthy and forward-looking insurance sector. We look forward to continued collaboration between industry and regulators to cultivate a stable, transparent, and innovative environment for the long-term development of Taiwan’s insurance market.

Suggestion 1: Continuously deepen the application of fintech to accelerate innovation and digital development.

1. Expand the scope and insured amounts of online protection insurance products. Since the Covid-19 pandemic, there has been a marked shift in consumer behavior toward independently researching and comparing insurance products online, in expectation of greater convenience and efficiency throughout the transaction process. Despite this demand, regulations continue to limit the types and insured amounts of products available through online channels, thereby constraining insurers’ ability to offer a seamless digital experience.
   We therefore recommend expanding the types of protection products that may be sold online and raising the maximum insured amount permitted through digital channels. These steps will help align regulatory practice with evolving consumer expectations while upholding essential safeguards for personal data protection and risk control.
2. Simplify identity verification requirements. As digital insurance becomes more prevalent, current identity verification procedures remain overly cumbersome, often requiring manual steps or in-person authentication that undermine digital convenience. The Committee encourages continued engagement with the Insurance Bureau of the Financial Supervisory Commission (FSC) and relevant cross-ministerial agencies to further simplify identity verification requirements through secure digital technologies, providing essential safeguards for personal data protection and risk control.
3. Continuously encourage cross-sector collaboration and streamline the trial process for innovative insurance services. The Committee supports the FSC’s objectives of promoting inclusive finance and welcomes its continued efforts to encourage collaboration between insurers and other industries in developing innovative, consumer-oriented products and services. Cross-sector partnerships and trial programs offer valuable opportunities to meet emerging societal needs, particularly in a rapidly evolving digital environment.
   Currently the introduction of new insurance services requires insurers to submit trial applications, with final product rollout contingent on subsequent regulatory approval. While this process ensures appropriate oversight, the Committee recommends that the Insurance Bureau simplify and accelerate the trial application and review mechanisms to foster a more dynamic innovation environment.
   In anticipation of the FSC’s upcoming policy of allowing digital insurance companies to enter the market under reduced capital requirements and with simplified regulatory processes, the Committee emphasizes the importance of regulatory consistency. The streamlined application and review procedures extended to digital insurers should also be made available to existing and traditional insurers. Additionally, protection periods for innovative products should be granted to all qualifying companies, regardless of business model.
   Moreover, where regulatory revisions have resulted from successful trials, the Committee recommends that other insurers be permitted to adopt such models directly, without undergoing a repeated trial process. For example, where remote insurance services have already been tested and implemented, other insurers should be allowed to adopt the same services directly to reduce redundancy and accelerate market responsiveness.
   Finally, existing regulations impose stringent controls over product design, pricing, and distribution, which may constrain the insurance industry’s ability to respond flexibly to market needs and limit progress toward the broader policy goal of inclusive finance. To address this issue, the Committee recommends that the authorities increase flexibility in the regulatory framework governing the design of life insurance products. In particular, we suggest allowing insurers to introduce a wider variety of foreign insurance products that meet local compliance standards. This approach would expand consumer choice, enhance market competitiveness, and better align Taiwan’s insurance offerings with international trends.

Suggestion 2: Adjust the cash dividend return mechanism for life insurance companies.

Under the Company Act and Insurance Act, life insurance companies may distribute surplus in the form of cash dividends only after offsetting accumulated losses, paying all applicable taxes, and setting aside the required statutory and special surplus reserves. This process must be based on financial statements audited by a certified accountant and reviewed and approved by the board of directors, with final distribution subject to the resolution of the shareholders’ meeting.

However, under administrative order 10202501992 issued by the FSC in 2013, life insurance companies must also obtain prior approval from the Commission before distributing cash dividends. In addition to fulfilling the requirements of the Company Act and Insurance Act, insurers are subject to case-by-case review by the FSC, which evaluates each proposal based on the company’s financial structure, business performance, and the implementation status of new accounting standards. Only after receiving formal approval may the insurer proceed with the distribution.

With the scheduled adoption of the International Financial Reporting Standard (IFRS) 17 and the new generation solvency system TW-ICS on January 1, 2026, most life insurers have already completed necessary capital strengthening and are actively managing their financial and business performance.

Considering these developments, the Committee recommends that the FSC revise the dividend approval process. Specifically, we urge the abolition of the 2013 administrative order in favor of a framework grounded in the Company Act and Insurance Act, emphasizing internal governance and board oversight in determining dividend distributions. This shift would modernize regulatory oversight in line with international standards and enhance predictability for insurers and investors.

Specifically, we suggest that the FSC:

1. Abolish the existing administrative order and issue a new directive that provides administrative guidance rather than mandatory case-by-case approvals. This new order should clearly define the financial and operational standards that life insurers must consider when evaluating the feasibility and scale of cash dividend distributions.
2. Discontinue the case-by-case review requirement. Instead, oversight should rely on the internal review mechanisms of each life insurance company, in line with established principles of corporate governance. Under this structure, the board of directors and shareholders would retain the authority to determine dividend distributions, based on recommendations generated through each company’s internal evaluation processes.

This approach will bring the regulatory framework in line with the principles of the Company Act and Insurance Act while maintaining necessary safeguards through strengthened internal governance and transparency.

The Committee anticipates that specific, clear, and objective administrative guidance will encourage life insurance companies to further strengthen internal controls, corporate governance practices, and financial stability. Such an approach will in turn enhance the overall effectiveness of regulatory oversight while fostering a more predictable and transparent operating environment.

We believe that this improved framework will help build greater confidence among foreign investors and domestic financial holding companies, encouraging continued capital support for life insurance firms. In turn, this will contribute to a more stable and resilient life insurance sector, advancing Taiwan’s broader objective of achieving long-term sustainable development within its financial services industry.