The decision by French property insurer BNP Paribas Cardif SA to withdraw from the Taiwanese market does not indicate that the local investment environment is worsening, Financial Supervisory Commission (FSC) Chairman Peng Jin-lung (彭金隆) said yesterday.
When asked by lawmakers at a meeting of the legislature’s Finance Committee about the French insurer’s plan to exit, Peng said foreign companies have different global expansion strategies but he was sure this decision had nothing to do with Taiwan’s investment environment.
The FSC confirmed on Sunday that it has received an application from BNP Paribas Cardif’s Taiwan branch to terminate its business in Taiwan after it inaugurated operations in 2000.
Photo: Tien Yu-hua, Taipei Times
Insurance Bureau Deputy Director-General Tsai Huo-yen (蔡火炎) said on Tuesday that the French insurer’s withdrawal would have little impact on the local insurance market because of its low 0.04 percent market share and relatively small presence in Taiwan.
The French insurer has a staff of 32 in Taiwan and 48,000 valid policies, mostly involving home and fire insurance and personal injury insurance, Tsai said.
Its decision to end its operations in Taiwan was due to the company’s failure to expand its operations to a large enough scale at which sufficient revenue would be generated to cover its costs, Tsai said.
Even though its headquarters in France had injected NT$483 million (US$15.17 million) into the Taiwan branch in recent three years, BNP Paribas Cardif in Taiwan still incurred losses for at least five years in a row, he said.
Though the company is intent on ending its operations, a complete withdrawal is unlikely to happen for at least three years given that most property insurance polices are one-year policies and the statute of limitation for policyholders to file a claim is two years, Tsai said.
He added that if the company is involved in any legal action in Taiwan, it will have to complete the process before leaving.
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