Digitalization in Insurance Guide | Taiwan | Asia Pacific Insurance

Is there any specific regulation governing the sale of insurance through online platforms?

Yes. The Guidance for the Handling of Electronic Commerce in the Insurance Sector ("Guidance"), last amended in November 2017 and promulgated by the Financial Supervisory Commission ("FSC"), governs the sale of insurance through online platforms.

Is the sale of insurance through mobile applications subject to the same requirements as the online sale?

Yes.

Set out three key regulatory requirements for the distributions of products online or through mobile applications.

Three key regulatory requirements are: (i) the insurance company applying to the FSC for engaging in the online sale of products must meet certain requirements, e.g., the applicant’s risk-based capital (RBC) must meet the regulatory requirement, the amount of fines imposed by the FSC on the applicant in the past year does not exceed certain amounts; (ii) the products are limited to those set out in the Guidance, e.g., non-life insurance products with insurance premium of NTD 100,000 (approximately USD 3,333) or less, and (iii) the sale must be done in accordance with requirements under the Guidance.

Do the current insurance regulations in your jurisdiction allow the KYC process be done online or electronically? If so, what are the key requirements?

KYC could be done online/electronically. An Insurance company is required to send out an one-time password to the customer's email or cell phone to verify the identity. In case of life insurance products, if the insured is different from the policyholder, the policyholder must use his/her electronic IC card to conduct the online application and registration and the insured must provide his/her consent by also using his/her electronic IC card. In addition, in case of a new customer, the insurance company can only accept the payment of premium by this customer’s own credit card or wire transfer from this customer’s own bank account.

Do the insurance regulations permit insurance policies/contracts to be concluded through digital means? For example, through a “click-through” or “e-signature”, without any wet signature.

Yes but the IT security of the insurance company’s online platform must be certified in accordance with ISO 27001.

Is there any specific regulation governing the advertising of insurance products through online platforms or the use of aggregators?

Yes. In accordance with the Self-regulatory Guidance of Advertising by the Insurance Sector, soliciting insurance products through online platforms needs to be first cleared with the compliance department to make sure it complies with the relevant regulations.

Are there any customer service requirements if the insurers sell their products online?

The Guidance requires that insurance companies set up a dedicated section on its online platforms for customer to review all the relevant materials and terms and conditions of the insurance products. In addition, after selling the product online, the insurance company must select and call at least certain percentage of these policyholders to confirm their willingness to purchase the insurance products and then send a written or electronic policies to them.

If an obligation is imposed on insurers to allow customers to amend or update their policies online, are there any specific regulatory requirements governing that process?

There is no such obligation imposed yet.

Are insurers required to apply for specific insurance licenses in order to conduct online sales?

Yes. Insurers are required to apply to the FSC for engaging in the online sale of insurance products.

In order to conduct online sales, are insurance intermediaries required to apply for any specific insurance licenses?

Yes. The Guidance for the Handling of Online Enrollment of Insurance by the Insurance Agent and the Insurance Broker was promulgated in November 2017 (Guidance for Intermediaries). Insurance intermediaries are also required to apply to the FSC for engaging in the online solicitation of insurance through online platforms. In addition, insurance intermediaries are required to have a information security system with a certification of ISO 27001. Insurance intermediaries must ensure that the insurers they cooperate with are already approved to engage in the online business in accordance with the Guidance.

Are there specific requirements on the commission rates paid to insurance intermediaries for online sales? Please specify if these rates are different from the rates applicable in the case of insurance sale through other means.

No. We are not aware of any specific requirements on the commission rates paid to insurance intermediaries for online sales. According to Article 4 of the Guidance for Intermediaries, the insurance intermediaries engaging in online business must ensure that the insurers they cooperate with reflect the cost they save in the additional fee of the insurance products.

Where the insurers do not engage in online insurance sales themselves, but engage intermediaries to do so, would the insurers be deemed as offering or selling insurance products online?

Yes, the insurers would be deemed as offering or selling insurance products online. According to Article 6 of the Guidance for Intermediaries, insurance intermediaries must ensure that the insurers they cooperate with are already approved to engage in the online business in accordance with the Guidance.

Asia Pacific Insurance

Taiwan

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