Home »
Taiwan Insurance Report Q1 2012

Taiwan Insurance Report Q1 2012

Double click on above image to view full picture

Email to a Colleague - Print - Fax Order

Additional Information

Price	$530.00
Publisher	Business Monitor International
Date of Report	Jan 10, 2012

Add to Wishlist | Add to Compare

Qty:

-OR-

Quick Overview

The past development of Taiwan’s insurance sector reflects a combination of factors. Like much of East
and South East Asia, Taiwan’s savings rate is high: over the long-term, the island has consistently run a current account surplus. As in Japan, life insurance is well established as a conduit for savings in a country where financial markets have, by some metrics, been under-developed. This is partly because of tax breaks that support usage of insurance, and partly because of the strong brands and distribution networks of the major companies. Taiwan is unusual in that Chunghwa Post (which is analogous to Japan Post in Japan and La Poste in France) is a major player in the life segment. As a result of these various factors, the life insurance segment is huge. Premiums are about twice those of Australia, a country whose population and economy are of similar sizes to those of Taiwan and a country that is not lacking in large and dynamic financial services companies.
However, Taiwan also has much in common with South Africa or Israel in that geo-political issues have
resulted in the sector being dominated by massive local financial services conglomerates. In Taiwan and in the other two countries, the conglomerates have – for much of their history – had limited access to foreign capital – so they have been built around intricate cross-shareholdings and commercial relationships within the national boundaries. The absolute size, relative size, access to capital, brand and distribution networks of the massive Taiwanese financial services conglomerates – Cathay, Fubon and Shin Kong – which own the eponymous life companies and associated non-life companies, make them formidable competitors. Nevertheless, it has clearly been possible for major foreign multi-nationals to build very substantial businesses on the island – in both life and non-life insurance.
Overall, then, it is fair to say that Taiwan’s insurance sector is like no other. Life premiums have been
suppressed in 2011 –but mainly because the various players have focused on profitability rather than market share for its own sake. Some companies have emphasised particular products; others, particular distribution channels. Nevertheless, it is clear from the reports of Cathay Financial and Fubon, for instance, that life premiums actually shrank over the course of the year: in this respect, Taiwan is very unusual. Amazingly for a non-life market with high per capita income, the growth of the non-life segment is being driven by motor insurance. For several foreign companies (especially in the life segment), Taiwan has become a market that they would rather no longer be involved with: however, some of the organisations that are leaving are doing so because of problems in their home countries. In some ways, the absolute size of the Taiwanese insurers is a disadvantage. Although they are expanding beyond the confines of the island (most notably in mainland China but also in Vietnam), their overseas operations are still tiny – and not able to offset the impact of the slowdown at home. Moreover, the massive Taiwanese life companies have significant exposures to bonds in the Euro area.

Table of Contents

Executive Summary ........................................................................................................................................ 5
Table: Taiwan’s Total Premiums 2008-2016 ........................................................................................................................................................ 5
Key Insights And Key Risks ........................................................................................................................................................................................ 5
SWOT Analysis ................................................................................................................................................ 7
Taiwan Insurance Industry SWOT ........................................................................................................................................................................ 7
Taiwan Political SWOT ........................................................................................................................................................................................ 8
Taiwan Economic SWOT ...................................................................................................................................................................................... 9
Taiwan Business Environment SWOT ................................................................................................................................................................. 10
Life Sector ...................................................................................................................................................... 11
Asia Pacific Life Sector Overview ............................................................................................................................................................................ 11
Table: Asia Pacific Life Premiums, 2008-2016 (US$mn) ................................................................................................................................... 11
Taiwan Life Sector Update ...................................................................................................................................................................................... 14
Table: Breakdown of Life Premiums ................................................................................................................................................................... 14
Life Industry Forecast Scenario ............................................................................................................................................................................... 16
Table: Taiwan’s Total Life Premiums 2008-2016 ............................................................................................................................................... 16
Growth Drivers And Risk Management Projections ................................................................................................................................................ 17
Population .......................................................................................................................................................................................................... 17
Table: Taiwan’s Insurance Key Drivers, Demographics 2008-2016 ................................................................................................................... 17
Non-Life Sector .............................................................................................................................................. 18
Asia Pacific Non-Life Sector Overview .................................................................................................................................................................... 18
Table: Asia Pacific Non-life Premiums, 2008-2016 ............................................................................................................................................ 18
Taiwan Non-Life Sector Update ............................................................................................................................................................................... 20
Table: Taiwan’s Breakdown of Non-Life Premiums ........................................................................................................................................... 20
Non-Life Industry Forecast Scenario ....................................................................................................................................................................... 21
Table: Taiwan’s Total Non-Life Premiums 2008-2016 ....................................................................................................................................... 21
Growth Drivers And Risk Management Projections ................................................................................................................................................ 22
Macroeconomic Outlook ..................................................................................................................................................................................... 22
Table: Taiwan Economic Activity, 2011-2016 ................................................................................................................................................... 23
Political Stability Outlook ........................................................................................................................................................................................ 24
Table: Asia Pacific Regional Security Ratings .................................................................................................................................................... 26
Healthcare ............................................................................................................................................................................................................... 26
Healthcare Insurance ......................................................................................................................................................................................... 27
Taiwan: Insurance Coverage .............................................................................................................................................................................. 27
Epidemiology ...................................................................................................................................................................................................... 29
Motor .................................................................................................................................................................................................................. 29
Table: Taiwan’s Insurance Key Drivers, Autos 2008-2015 ................................................................................................................................ 30
Insurance Risk/Reward Ratings ................................................................................................................... 31
Table: Taiwan’s Insurance Risk/Reward Ratings ............................................................................................................................................... 31
Table: Asia Pacific Insurance Risk/Reward Ratings ........................................................................................................................................... 32
Competitive Landscape ................................................................................................................................ 33
Competitive Landscape Analysis .............................................................................................................................................................................. 33
Major Players In Taiwan’s Insurance Sector ........................................................................................................................................................... 36
Table: Ranking Of Life Companies By Premiums, 2010 (TWDmn) ..................................................................................................................... 39
Table: Ranking Of Non-Life Companies By Premiums, 2010 (TWDmn).............................................................................................................. 40
Company Profiles .......................................................................................................................................... 41
Local Company Profiles .......................................................................................................................................................................................... 41
Cathay Life Insurance ......................................................................................................................................................................................... 41
Fubon Life Insurance .......................................................................................................................................................................................... 42
MSIG Mingtai Insurance .................................................................................................................................................................................... 43
Shin Kong Life Insurance .................................................................................................................................................................................... 44
Regional Company Profiles ..................................................................................................................................................................................... 45
Ageas .................................................................................................................................................................................................................. 45
AEGON ............................................................................................................................................................................................................... 47
AIA Group Limited ............................................................................................................................................................................................. 48
Allianz ................................................................................................................................................................................................................. 50
Aviva ................................................................................................................................................................................................................... 52
AXA ..................................................................................................................................................................................................................... 54
BNP Paribas Cardif ............................................................................................................................................................................................ 56
Chartis ................................................................................................................................................................................................................ 58
HDI-Gerling ....................................................................................................................................................................................................... 60
HSBC Insurance ................................................................................................................................................................................................. 61
ING Group .......................................................................................................................................................................................................... 63
Liberty Mutual .................................................................................................................................................................................................... 64
Manulife .............................................................................................................................................................................................................. 66
MetLife ALICO ................................................................................................................................................................................................... 68
Prudential Financial ........................................................................................................................................................................................... 71
Prudential plc ..................................................................................................................................................................................................... 73
RSA ..................................................................................................................................................................................................................... 75
Sun Life Financial ............................................................................................................................................................................................... 76
The Principal ...................................................................................................................................................................................................... 78
Zurich Financial Services ................................................................................................................................................................................... 79
BMI Methodology .......................................................................................................................................... 81
Insurance Risk/Reward Ratings ............................................................................................................................................................................... 82
Table: Insurance Risk/Reward Indicators And Rationale ................................................................................................................................... 84
Table: Weighting Of Indicators .......................................................................................................................................................................... 85