Amendments to the Financial Consumer Protection Act (金融消費者保護法) took effect on Friday, raising compensation benchmarks to NT$1.2 million (US$43,265) for investment-linked products and NT$120,000 for non-investment products, from NT$1 million and NT$100,000 respectively.
The rising benchmark hike follows changes in inflation and economic growth, and aims to enhance consumer protection, the Financial Supervisory Commission said.
Under the new regulations, after the Financial Ombudsman Institution (FOI) reviews a consumer complaint regarding a financial product or service, and determines appropriate compensation, the company should accept its decision without ability to appeal.
Photo: Kelson Wang, Taipei Times
The products include securities, trusts, funds, derivatives, gold, foreign securities, futures and investment-linked insurance policies, the commission said on Thursday.
In disputes regarding non-investment products, such as medical insurance, the financial company must accept the FOI’s decision when it involves compensation of NT$120,000 or less under the new regulations, the commission said.
The commission announced drafts of the amendments last month and did not receive any objections from companies in the financial sector, Hsu Tsui-wen (徐萃文), head of the commission’s legal department, said at a news briefing.
In the past few years, about half of the complaints did not require a review by the FOI, as consumers and financial companies had reached settlements before the cases moved into the review stage, the FOI said.
Among the remaining complaints, about half were withdrawn by consumers and one-quarter were resolved privately before FOI involvement, leaving the roughly one-quarter of remaining complaints to go forward to the FOI for a decision, the commission’s data showed.
The new regulations are not retroactive, and an FOI decision is binding only for financial companies, the commission said.
If a consumer believes that the amount of compensation is insufficient, they can reject the offer, request further negotiations or take legal action, it said.
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