Taiwan’s Financial Supervisory Commission (FSC) is considering measures to push insurers to invest more in domestic public infrastructure and strategic sectors such as social welfare, artificial intelligence and security.
Figures posted on the regulator’s website show that as of end-September, insurers in Taiwan allocated NT$161 billion (US$5.09 billion) – just 0.04% of the industry’s NT$33.5 trillion total assets – to public infrastructure and social welfare, far less than the maximum 15% set by the government.
This week, Peng Jin-lung, chairperson of the FSC, delivered a report to Taiwan’s legislature outlining three measures aimed at encouraging insurers to invest in the sectors.
The first was to draft guidelines focusing on evaluation of investments and financing criteria.
The second was to relax criteria for assessing insurance investments in social welfare, including long-term care businesses.
The third was to slash insurers’ risk coefficients – a metric quantifying investment risk – to 1.28% from the current 10.18% for investments below NT$50 billion in domestic infrastructure projects funded by venture capital.
“This reduction in risk coefficient will substantially lower insurers’ capital costs and directly enhance their investment incentives,” Peng said in the televised presentation to lawmakers on January 7.
He did not give a timeline to implement the measures.
