The Financial Supervisory Commission (FSC) yesterday passed a draft regulation that will initiate sales of micro-insurance to the nation’s 3 million financially disadvantaged citizens.
“It’s becoming an international trend to facilitate a social safety net by providing low-income groups with insurance protection,” Wu Chung-chuan (吳崇權), deputy director-general of the commission’s Insurance Bureau, told a media briefing yesterday.
Sixteen of the nation’s 30 life insurers have agreed to support the government’s bid and offer micro-insurance policies, he said, citing the bureau’s survey.
Micro-insurance refers to insurance policies characterized by low premiums or low coverage limits and designed to service low-income people and businesses not served by typical social or commercial insurance schemes.
In the draft regulation, single individuals who earn less than NT$250,000 (US$7,588) a year or double-income families with annual earnings of less than NT$500,000 will be eligible to purchase one-year life and accident insurance policies with a maximum benefit of NT$300,000 per policy.
Aboriginal groups, local or foreign fishermen with local IDs, or members served by local social welfare groups will also be included in the scheme, the commission said.
Under the draft regulation, a 40-year-old man would pay NT$675 per year to be covered with a death benefit of NT$300,000, and another NT$165 per year for an accident benefit of NT$300,000.
The premiums are, on average, 45 percent to 60 percent cheaper than those of commercial insurance schemes, Wu said, adding that his bureau would finalize the regulation next week, after which insurers would be able to apply for approval to sell the policies.
The new policies may hit the market in September, since the applications usually take less than 90 days to process, he said.