Amendment to Paragraph 6 of the Directions for Sale of Investment-linked Insurance Products
2018-07-19
In order to safeguard rights and interests of senior holders of investment-linked insurance policies, the FSC introduced an amendment to Paragraph 6 of the Directions on July 19, 2018. The key points of the amendment are:
1. The FSC introduced the regulatory requirement on preservation of audio and video records of the communication between customers over 70 years old and the sales representatives in the sales process with customers’ consent or the preservation of information related to operation activities with electronic equipment. Insurance companies are also required to underwrite the policies only after their appropriate units or personnel review these records and confirm appropriateness of the transactions of the insurance products.
2. The aforementioned sale process shall include but not limited to the following items:
(1) Insurance solicitors shall present their registration certificates for the information about their companies and the investment-linked insurance products they are allowed to sell.
(2) Policy holders shall be informed of the product types, i.e. investment-linked insurance, insurance company name, the relation between the solicitor and the insurance company, premium payment period, the amount of premium payment, policy-related expenses (including insurance expense, such as cost of insurance) and the payment collection method.
(3) Insurance companies shall explain important clauses of the insurance contract, investment risks, exceptions, policy recommendations and important information in the product brochure.
(4) Insurance companies shall explain the right to cancel the policy.
(5) Insurance companies shall ask the customers whether they are aware of the annual premium amount and the risk of losing money when the investment return is not desirable and shall confirm whether the customers can afford the premium and potential loss.
1. The FSC introduced the regulatory requirement on preservation of audio and video records of the communication between customers over 70 years old and the sales representatives in the sales process with customers’ consent or the preservation of information related to operation activities with electronic equipment. Insurance companies are also required to underwrite the policies only after their appropriate units or personnel review these records and confirm appropriateness of the transactions of the insurance products.
2. The aforementioned sale process shall include but not limited to the following items:
(1) Insurance solicitors shall present their registration certificates for the information about their companies and the investment-linked insurance products they are allowed to sell.
(2) Policy holders shall be informed of the product types, i.e. investment-linked insurance, insurance company name, the relation between the solicitor and the insurance company, premium payment period, the amount of premium payment, policy-related expenses (including insurance expense, such as cost of insurance) and the payment collection method.
(3) Insurance companies shall explain important clauses of the insurance contract, investment risks, exceptions, policy recommendations and important information in the product brochure.
(4) Insurance companies shall explain the right to cancel the policy.
(5) Insurance companies shall ask the customers whether they are aware of the annual premium amount and the risk of losing money when the investment return is not desirable and shall confirm whether the customers can afford the premium and potential loss.
Visitor:
904
Update:
2018-08-17