TAIWAN Law and Practice Contributed by: Robin Chang, Sarah Wu and Eddie Hsiung, Lee & Li
with an insurance period of less than three years) to customers over 65 years of age and considering whether the customer has the ability to distinguish situations that are disadvantageous to his or her rights and interests as an insured. • The operating procedure for evaluating whether the source of funding for payment of insurance premi - ums is from a terminated insurance contract, loan or policy loan. • The operating procedure for confirming the iden - tity of the applicant and that he or she has indeed purchased a policy, the identity of the insured and that the insured has given his or her consent to the policy purchased. • The operating procedure for confirming that a designation or change of beneficiary has been consented to by the insured. • The operating procedure for confirming that the applicant has indeed applied for a change to the content of the insurance contract that would affect risk assessment, and the identity and signature of the applicant and the insured. • The operating procedure for the manner and dura - tion of retaining and disposing of the personal data of the applicant, the insured and the beneficiary of policy applications, whether they were underwrit - ten or not. • The operating procedure for evaluating risks and the calculation and collection of insurance premi - ums, which shall be based on actuarial science and statistical data. 8.2 Treatment of Different Types of Insurance Under the Insurance Act, insurance is classified into two main categories: “non-life insurance” (covering fire, marine, land and air, liability, bonding and other non-life insurances) and “insurance of the person” (covering life, health, personal injury and annuity insur - ances), depending on the nature of the insured sub - ject. As stipulated by the Insurance Act, a “non-life insurance” enterprise is exclusively involved in non-life insurance activities, and an “insurance of the person” enterprise solely engages in insurance of the person. Simultaneous involvement in both non-life insurance and insurance of the person by the same insurance enterprise is generally prohibited, except when a non- life insurance enterprise is granted approval by the
FSC to carry out the businesses of personal injury insurance or health insurance. From a regulatory perspective, certain insurance laws and regulations are applicable to both “non-life insur - ance” and “insurance of the person” enterprises. However, distinct principles and specific regulations may be applicable based on the nature of each insur - ance product involved, etc.
9. Regtech 9.1 Regulation of Regtech Providers
There are no specific laws or regulations governing regtech providers (assuming they are not financial services entities). However, if any regulated financial services entity wishes to outsource its operation to a regtech provider, outsourcing regulations governing financial services entities may apply. Please see 2.8 Outsourcing of Regulated Functions for outsourcing. 9.2 Contractual Terms to Ensure Performance and Accuracy Please see 2.8 Outsourcing of Regulated Functions and 9.1 Regulation of Regtech Providers . 10. Blockchain 10.1 Use of Blockchain in the Financial Services Industry The rise of blockchain technology has led to finan - cial institutions actively researching how to incorpo - rate it into their products and services. Some have even established dedicated research and develop - ment departments for this purpose. However, since the financial industry is heavily regulated, the imple - mentation of blockchain in this sector would need to overcome certain existing legal restrictions. Exam - ples of the solutions to deal with such restrictions include applying to enter a regulatory sandbox, with two approved applications related to blockchain: (a) using blockchain for fund transfer information between financial institutions; and (b) providing a “fund exchange” service using blockchain technol - ogy. With the emergence of new business models and regulatory amendments, it is expected that the finan -
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