TAIWAN Law and Practice Contributed by: Daniel T H Tsai, Lee and Li
must not exceed the amount of the indemnification paid to the insured. In addition, it is also ruled that where the loss or dam- age is caused by a family member or employee of the insured, the insurer does not have the right of subrogation upon payment. However, if such loss or damage resulted from the wilful misconduct of said family member or employee, the aforementioned rule does not apply and thus the insurer can still claim by subrogation. 10. Insurtech 10.1 Insurtech Developments In Taiwan, many insurance companies use innovative insurtech to: • design new insurance products and solutions; • improve processes and operational efficiency; and • improve customer satisfaction. Blockchain, AI, and data analysis are specific ways in which insurtech is used. The value of the insurance industry has gradually transformed along with the development of insurtech. The purpose of traditional insurance is to compen- sate for risks, but now insurance can aim to effectively eliminate risks. 10.2 Regulatory Response In recent years, Taiwan’s insurance technology has become more and more digital. The government has tried to promote the “Preservation and Claims Alliance Chain” and its plan to allow online-only insurance companies to operate, meaning that AI and block- chain will be more widely used to reduce labour costs and improve operating procedures. In response to people who needed to purchase insur- ance products but were unable to go out because of COVID-19, the FSC formulated the Regulations Gov- erning Online Insurance Business and Online Insur- ance Services of Insurance Agent Companies and Insurance Broker Companies to provide consumers with convenient and safe insurance services that
were no longer face-to-face. With the advancement of modern technology and changes in lifestyles, the FSC’s Insurance Bureau anticipated that Taiwan’s insurance industry would gradually enter the era of full digitisation in 2023. In March 2020, the FSC approved a trial of a new blockchain insurance project called the “Preserva- tion/Claims Alliance Chain”, which aims to bring the insurance industry in Taiwan into a digital and more convenient era. Under the project, if a person needs to change their address and has multiple policies with different insurers, they only need to update their data one time and share it with other insurers. Furthermore, if a person has multiple insurance policies and makes a claim under one policy, a blockchain smart contract will instruct the other insurance companies with which they have coverage to initiate a claim. Looking ahead, more and more digital information will be used in insurance disputes and this can be expect- ed to impact the process of litigation, arbitration or mediation for insurance disputes in Taiwan. With more insurance companies participating in the project, it is anticipated that systems for the digital settlement of insurance claims will become more comprehensive within the next three to five years. In recent years, many organisations in Taiwan have actively responded to the Taiwanese government’s digital policy initiatives, for example by integrating the international FIDO standard with electronic signatures to achieve a fully paperless compensation process (‘“ 理賠服務全程無紙化 ”). In addition, electronic insurance compensation services have been further enhanced, enabling policyholders to provide authorisation online and allowing hospitals, subject to certain require- ments, to use blockchain technology to transmit diag- nostic information and receipts directly to designated insurance companies. As of October 2025, more than 25 insurance companies, five insurance brokerage firms and over 55 medical service organisations in Taiwan have participated in this digital initiative.
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