News Life and Health29 Jun 2018

Taiwan:Protection gap is wide despite high insurance penetration rate

| 29 Jun 2018

With approximately NT$1 billion ($33 million) of new sales premiums flowing into the life insurance sector each year, Taiwan citizens are purchasing only NT$2 billion of protection, while other developed markets are achieving rates of protection at least four times higher, says the American Chamber of Commerce in Taiwan (Amcham Taiwan).

Although this protection gap can be measured in many different ways, the fact is that the savings oriented nature of insurance in Taiwan masks the true need for further protecting Taiwan citizens, says Amcham Taiwan in is 2018 Taiwan White Paper which summarises the chamber's recommendations to the government and public on legislative, regulatory and enforcement issues that have a major impact on the quality of the business environment.

Many Taiwanese purchase annuities, but in terms of lifetime income, only a very small percentage of people annuitise. In view of the aging of society, the lack of guaranteed lifetime income will leave many people exposed to significant longevity risk. The paper points out that Taiwanese people remain under-protected although at nearly 20%, Taiwan’s insurance penetration ratio is among the world’s highest.

Amcham Taiwan urges insurers and policymakers alike to focus on creating ever better outcomes to help Taiwanese families prepare for and address fundamental risks. The White Paper highlights five key areas of focus:

  1. Addressing the risks of dying too soon
  2. Addressing the risks of living too long
  3. Addressing the risks of being underinsured throughout life
  4. Actively enabling and ensuring customer experience 
  5. Promoting sound asset/liability & investment management practices.


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