The Financial Supervisory Commission (FSC) has said that new regulations regarding the management of insurance companies have been drafted and will be introduced on 1 March.
The main focus of the changes in rules includes conflict of interests, professional directors, and dismissal for those who violate the regulation.
The Insurance Bureau of the FSC said the goal is to strengthen corporate governance in the insurance industry and improve the professionalism and stability of the board of directors of insurers.
The draft regulations state that persons acting as directors of insurance companies must separate themselves from the businesses of related parties.
As for professional directors in insurance companies with assets of over NT$1tn ($33bn), if the number of directors is less than five, three should be professional directors. If the number of directors exceeds five, for every increase of three directors, there should be an addition of one professional director.
According to the statistics of the Insurance Bureau, currently Cathay Life, Nanshan Life, Fubon Life, Shin Kong Life, Taiwan Life, China Life, Mercuries Life, and TransGlobe Life have assets of more than NT$1tn.
The Insurance Bureau stated that professional directors in the insurance industry should be natural persons. Where the number of directors in a company is 13 or more, there must be five professional natural-person directors. Certain relatives are not allowed to serve as directors or management staff of the same insurance company.
In addition, the board of directors must verify the qualifications of management staff who must have moral standing, ability and competence. If the person in charge of violates this standard, the penalty is dismissal.