As part of its efforts to enhance the transparency of financial examination procedures, Taiwan's regulator, the Financial Supervisory Commission (FSC) has announced its primary examination findings for the 2H2025, pursuant to the "Principles for Effective Financial Examination".
In the segment looking into customer protection, the FSC looked into a few cases from the insurance industry.
Customer protection cases
In the first case, it mentioned a customer obtaining a bank loan within three months prior to applying for an insurance policy, using it as the source of premium payments. However, the sales agent failed to duly complete the solicitation report.
Secondly, the FSC highlighted a lack of balanced disclosure during the promotion of investment-linked insurance products connected to income-distributing funds. Specifically, the regulator noted the overemphasising of distribution payouts, as well as neglect to disclose that such amounts are not guaranteed and that payouts may be drawn from the principal.
Lastly, the FSC stated that in cases involving irregularities in solicitation where the insurance company sought clarification from the sales agent, responses were provided solely by the agents, and no review or confirmation mechanism for such inquiries were established.
Corrective actions
The FSC issued a reminder that insurance salespersons are obligated to honestly complete solicitation reports.
For insurance product sales documents, product characteristics must be explained and relevant risk warnings disclosed to prevent consumer disputes.
The regulator also stated that insurance brokers and agencies are required to establish a review and confirmation mechanism for underwriting inquiries from insurers; this ensures the suitability of insurance products for financial consumers and strengthens the management of abnormal solicitation cases.