FSC to add risk rules for life insurers

The Financial Supervisory Commission (FSC) on Thursday said it would refer to the EU’s regulations and add the “symmetric adjustment” mechanism into its risk-based capital calculation for life insurers, which is expected to liberate investment funds in the sector and help stabilize local markets.

Risk-based capital is what a financial institution is required to have in reserve based on its size and risk profile. It is a value multiplied by stock position, risk weighting and a weighted beta.

With the new rules, the risk weighting of Taiwanese stocks will become adjustable according to the performance of local shares, the commission said………………………………………..CLICK HERE