COVID insurance claims could top US$1.39 billion in Taiwan

台灣新冠保險理賠金額可能高達 13.9 億美元

Insurance firms pay holders who test positive or have to quarantine after being listed as close contact of confirmed cases

TAIPEI (Taiwan News) — Taiwan’s insurance sector could be looking at upwards of NT$41 billion (US$1.39 billion) in COVID-19 claims due to the country’s recent Omicron surge.

Speaking at a finance committee hearing at the Legislative Yuan on Monday (May 23), Financial Supervisory Commission (FSC) Chairman Huang Tien-mu (黃天牧) said claims could exceed an estimate put forth by Kuomintang Legislator Lai Shyh-bao (賴士葆), according to CNA. Lai had pointed out that insurance companies have sold around 7.6 million COVID policies, and with an infection rate of 15% with an average payout of NT$36,000, the industry could be staring at NT$41 billion in payouts.

Under these COVID policies, non-life insurance companies pay holders if they test positive or have to quarantine due to being listed as a close contact of confirmed cases.

The FSC head noted that domestic cases are still increasing and that the actual amount could exceed Lai’s estimates.

Meanwhile, Democratic Progressive Party Legislator Chiang Yung-chang (江永昌) said during the hearing that if 8 million policies are sold amid an infection rate of 20%, insurance companies could have to pay out NT$100 billion, CNA reported. Chiang suggested the government step in to provide relief using the Taiwan Insurance Guaranty Fund.

Huang said the commission was not inclined to use public funds to address the insurance sector’s financial woes, adding that the insurance guaranty fund for non-life insurance companies only had around NT$5 billion. Huang replied the FSC would instead urge insurance companies to increase capital by having shareholders inject more funds into the firms.