Bangladesh

1.

World Bank Allocated USD 65 Million For the Development of Insurance Industry
in Bangladesh:
World Bank sanctioned a loan of USD 65 Million for the development of Insurance
Industry in Bangladesh. Bangladesh Government already prepared a draft paper
for the project entitled ÒBangladesh Insurance Development Project”. The main
objective of the project are organizational development, skilled ness, monitoring
capability enhancement of Insurance Development & Regulatory Authority (IDRA),
Two public Life & Non-Life Insurance Corporation and to increase the number ofpolicy holders. To reform Bangladesh Insurance Academy to enhance the quality of
insurance education and training would be done relatedly.

2.

Insurance Fair Held First Time in Bangladesh for Building Public Awareness:
Insurance Development and Regulatory Authority (IDRA) arranged a historicalInsurance Fair from 23-25 March, 2016 for the first time in Bangladesh to build up
public awareness. Maximum Life and Non-Life insurance companies out of 77
operators participated in the fair. On spot, online policy selling, open discussion,
seminars were held on the fair.

3.

Life Insurance Companies in Bangladesh is in Solvency Crisis:
Except 5-6 most of the Life Insurance companies are in solvency crisis. As a resultcompanies are fail to settle maturity claims in due time, policies are bonus less year
after year and above all the public interest hampered seriously. Because most of theLife insurance companies do not have sufficient reserve to meet up the liability andthe Insurance Development and Regulatory Authority (IDARA) is still to develop
the solvency guideline. By the by the Insurance Act 2010 already adopted instead of
Insurance Act 1938 and many reforms are going on to overcome the situation.

Compiled by M. Ahsanul Haq a highly dedicated volunteer for the Actuarial andInsurance Profession in Bangladesh. He is involved in the Research for Analyzing theMortality andLife Insurance

Claims. He also

performs

asa Faculty ofActuarial-Insurance Education and Training. He is the founding member as well as theTreasurer of the Actuarial Society of Bangladesh (ASB).
E-mail: ahsan21aug@gmail.com
Actuarial Society of Bangladesh

China

1. Announcement of the Outline of the 13th Five-Year Plan for the Development ofChina's Insurance Industry.
The “13th Five-Year Plan” period is not only a runoff stage for China to build amoderately prosperous society but also a critical period to march from a big
insurance country towards a powerful one. On August 31, 2016, CIRC announced theOutline of the 13th Five-Year Plan for the Development of China's Insurance
Industry, which defines the guiding ideology, development goals, key tasks and policy
measures during the “13th Five-Year Plan” period. The Outline is formulated inaccordance with the 13th Five-Year Plan for National Economic and Social

Development of the People's Republic of China and Opinions of the State Council on
Accelerating the Development of Modern Insurance Service Industry. It is a
blueprint for the scientific development in the next five years and a guideline for thereform and innovation of the insurance industry. And furthermore, it is an importantbasis for insurance regulatory departments to perform their duties.
2. CIRC Strengthens the Supervision of Personal Insurance Products.
Recently, CIRC issued the Notice of the China Insurance Regulatory Commission on

Strengthening the Supervision of Personal Insurance Products and the Notice of the
China Insurance Regulatory Commission on Issues concerning Further Improving
the Actuarial System of Personal Insurance. It has once again enhanced the risk
protection level of personal insurance products and promoted the industry to further
adjust and optimize its business structure to produce stable and long-term cash flowwhich can provide stable and long-term financial support for the capital market, thereal economy and the state key infrastructure construction.
3. CIRC Continues to Strengthen Universal Insurance Supervision and Resolutely Curb
Irregularities.
In December 2016, CIRC issued a letter of supervision, suspending Foresea Life, aunit of financial conglomerate Baoneng Group, from selling universal life insurance
products because it had failed to make adequate changes to the problems of its
universal insurance business. At the meantime, CIRC has urged Foresea Life torectify and reform regarding the problems of its management of product development
and prohibited it from declaring new products within the next three months. For
other companies with similar problems in the operation of universal insurance
business, CIRC is paying close attention to the progress of their rectification andreform and will take further regulatory measures as appropriate.
Insurance Association of China

Indonesia

1. Forums in AAJI
AAJI has increased the number of regular Forums to support the needs of its
members to communicate, share knowledge and build the industry. AAJI's regular
Forum currently consist of: Chief Financial Officer Forum, Legal and Compliance
Forum,HRD

Forum,

Chief

Operational

Officer

Forum,

MarketingandCommunication Forum and Chief Risk Officer Forum.
2. Regulations
Within 2016 the regulator has released 11 regulations as follows:
POJK Nomor 73/POJK.05/2016 - Concerning Good Corporate Governance For
Insurance Companies
POJK Nomor 72/POJK.05/2016 - Concerning Financial Soundness of Insurance
and Reinsurance Companies With The Principles of Sharia
POJK Nomor 71/POJK.05/2016 - Concerning Financial Soundness of Insurance
and Reinsurance Companies
POJK Nomor 70/POJK.05/2016 - Concerning Business Conduct of Insurance
Brokers Companies, Reinsurance Brokers Companies and Insurance
Adjusters Companies.
POJK Nomor 69/POJK.05/2016 - Concerning Business Conduct of Insurance
Companies,

Insurance

Companies

with

The

Principles

of

Sharia,Reinsurance Companies and Reinsurance Companies with The Principles of
Sharia.
POJK

Nomor

68/POJK.05/2016-

Concerning

Business

LicensingandInstitutional Aspect of Insurance Brokers Companies, Reinsurance Brokers
Companies and Insurance Adjusters Companies
POJK

Nomor

67/POJK.05/2016-

Concerning

Business

LicensingandInstitutional Aspect of Insurance Companies, Insurance Companies withThe Principles of Sharia, Reinsurance Companies and Reinsurance
Companies with The Principles of Sharia
POJK Nomor 63/POJK.05/2016 - Concerning the amendment of POJK Nomor
11/POJK.05/2016 Concerning on Site Examination of Non-Bank Financial
Services Institutions
POJK Nomor 36/POJK.05/2016 - Concerning Regulation Changes of Treasury
Bill Investment for Non-Bank Financial Services Institutions

POJK Nomor 35/POJK.05/2016 - Concerning conduct of written commandprocedures for Insurance Industries.
POJK Nomor 1/POJK.05/2016 - Concerning Treasury Bill Investment for
Non-Bank Financial Services Institutions
3. The 29th Top Agent Awards
The 29th Top Agent Awards was held on August 10-11 at Medan, North Sumatera.
With theme Young, New and Different more than 1000 agents gather to celebrate
this annual awards occasion. Indonesia life Insurance Association (AAJI) engage
the agents and life insurance companies constantly to have young soul, generates
new achievements with the various innovation. As per 3rd Quarter 2016, total
licensed agents are 520.281 persons, and it's increased 16.3% than previous year.
The agents growth per year above 10%, and with Top Agents Awards will motivate
the agents to achieve more and to introduce the agent profession to public which will
inspiring them to become an agent.
Indonesia Life Insurance Association

Korea

1. Liberalization of Product Development
As a follow-up measure to the Roadmap to Enhance the Competitiveness of the
Insurance Industry, which was announced by the Financial Services Commission in
October, 2015, the Korean Life Insurance Association initiated a project in 2016 topromote product liberalization. The purpose of the project was to create a levelplaying field that can foster development of innovative products.
As a result, the Agreement to Protect Development Interests of New Life Insurance
Products was revised and the effective periods for the exclusive rights to sell life
insurance products were extended from six months to a maximum of one year. A
product deliberation committee, run by industry associations, was also establishedwhich will collect feedback and input from various stakeholders to develop and revise
the standard terms and conditions.
2. Introduction of Special Act on Insurance Fraud Prevention
The Special Act on Insurance Fraud Prevention was introduced to make theinsurance market more healthy and orderly, to prevent insurance fraud, and thereby
to reduce social costs. Insurers may file a police report or request an investigation if
there is plausible reason to consider the acts of a policyholder or others as insurance
fraud.
If the investigative authorities decide that the investigation into insurance fraudrequires an assessment of suitability for hospitalization, they may ask the Health
Insurance Review and Assessment Service to carry this out.
The Act was enacted on March 29th, and put into force on September 30th, 2016.
3. Development of Happy Life Years Index
In cooperation with the Transitional Gerontology and Retirement Research Center atSeoul National University, the Life Insurance Social Contribution Committee created
and announced a “Happy Life Years Index” on October 10th, 2016. It offers a way toevaluate how well one is prepared for one’s retirement based on the various factors
needed to become happier in one’s later years.
Unlike the existing old age preparation indexes that measure how well you areprepared for retirement using scores, the Happy Life Years Index shows the gap
between their expected life span and the preparedness to help people realize the needto prepare for their old age. It also shows that you can increase your happy life years
as much as you want if you work hard to fill the gap.
Korea Life Insurance Association

Malaysia

1.Moving towards digital transformation, Fintech and online channel
The significant changes which currently taking place in the insurance industry arein tandem with the transformation of life insurance business in Malaysia following
the implementation of LIFE Framework which came into force on 23 October 2015.
These include:Introduction of Balance Scorecard for agents and bank staff to improve
productivity and professionalism;Public Enquiry facility via online and sms to facilitate customers to ascertain
whether individuals they are dealing with to purchase life insurance
products are registered with LIAM as an authorised agent;

A Service Guide highlighting on the value-added services that policyholders
can enjoy for insurance purchase through agents;

Online customer portal for easy access to information on policy details, forms
and documents, e-payment options and updated data;

Diversified distribution channels via introduction of online products and / ordirect marketing channels, providing more access for people to purchase life
insurance while increasing the reach and penetration of insurance among
the new generation of consumers andDevelopment of a product comparator/financial calculator to guideconsumers to choose suitable life insurance products available in the market.

Advances in financial technology (fintech) in Malaysia have led to the introductionof new business models and solutions that have contributed to improvements incustomer value and experience as well as financial institutions’ efficiency and risk
management.
In line with the revolution in business brought about by technological advancements,
on 18 October 2016, BNM introduced the Financial Technology Regulatory Sandbox
Framework (Framework) to provide a regulatory environment that is conducive forthe deployment of fintech and to enable innovation of fintech to be deployed andtested in a live environment, within specified parameters and timeframes. With theframework, financial institutions and fintech companies will now be able to pilot
innovations in a controlled, live-test environment with appropriate flexibilities
accorded.

The experience from the sandbox will provide input into formulating more
proportionate regulations that will spur the orderly growth of new innovations in
the insurance industry and see the significant potential for positive disruptions totransform the business of insurance in Malaysia – from the way insurance isconsumed, to opportunities for addressing leakages to drive insurance costs lower.
2. LIAM attracts young talents through LIAM Structured Internship Programme
LIAM in collaboration with Ministry of Higher Education (MOHE) and the
Malaysian Insurance Institute (MII) launched its first intake of students under the
LIAM

Structured

Internship

Programme

(LIAM

SIP)

with

some

30

undergraduates/graduates from universities in Malaysia on 29 November 2016.
In conjunction with the launch, interns were trained to develop good leadership,communication and presentation skills at a 2-day motivational workshop. The
students were also briefed on industry’s landscape, regulatory environment and key
issues during the workshop.
The LIAM SIP is part of the industry’s contribution towards human capitaldevelopment under the Insurans Hayat Cares’ community platform. The industry isproviding opportunities to young undergraduates to gain real-life work experienceand put theories they learnt in universities into practice in a 3-month internshipprogramme with any 16 life insurance and reinsurance companies in the country.
3. “Dream to Fly” Wins Big at the 2nd season of Youth Video Awards 2016
“Dream to Fly”, produced by Dreamers of UiTM Puncak Perdana an adaptation of atrue story of a poor boy from a small village, Kampung Muhibbah in Sandakan
Sabah captured the hearts of the jury and won the Grand Prize of the second season
Youth Video Awards 2016 to bring home RM8,000 cash, a winning trophy, best actor
award, best lecturer award and best university award.
The 1st Runner up went to Chanceux Productions of Universiti Malaysia Sarawakwith their winning entry “Samat”, and walked away with RM5,000 cash, a trophyand 1st Runner Up Lecturer Award.
Meanwhile the 2nd runner up went to Group 5 of UiTM Puncak Perdana with theirwinning entry, “Kalbu Bonda” and 3rd runner up went to Sendu Production of UiTM
Puncak Perdana with “Maaf Ayah”. Both production teams walked away with atrophy and RM2,000 and RM1,000 cash respectively. ’Kalbu Bonda’ also bagged theBest Actress Award through the character “Sarah” in the video. 7 other consolation
winners received a plaque and RM500 cash each.
The Deputy Governor of Bank Negara Malaysia, Encik Abdul Rasheed bin Abdul
Ghaffour presented the prizes to all winners.
The Youth Video Awards is a productive and creative collaboration with the
Malaysian Youth Community, Ministry of Higher Education (MOHE) and NationalFilm Development Corporation Malaysia; to share the message that life is precious,with a campaign mission, “Value Life, Capture Life and Share Life”. The theme is
all about You Only Live Once (YOLO) which aims to create awareness to Gen-Y on
the importance of appreciating life and how short life is, as you only can live once.
Click here to view the winning videos http://bit.ly/YVA2016 .
Life Insurance Association of Malaysia

Taiwan

1. Chaoyang Life Taken OverThe FSA designated Taiwan Insurance Guaranty Fund (TIGF) to take over
Chaoyang Life on January 26th of 2016, and then the sale of Chaoyang Life’s assets,
liabilities and business was taken by Nanshan Life on the premise that TIGF pays
NT$ 200million on January 16th of 2017. The insurance bureau stated that such isan important milestone, since after Chaoyang Life’s transaction completed, there isno life insurer of negative net value, hence, the industry moves towards stable andsteady market.

2. The Life Insurance Association of R.O.C. Re-elected the 7th Session of the Board of
Directors and Mr. Tiao Kuei Huang , the Vice Chairman of Cathay Life Insurance, as
Chairman of the Board
The Life Insurance Association of R.O.C. held the 7th session of the board of
directors, and re-elected Mr. Tiao Kuei Huang, the Vice Chairman of Cathay Life, as
chairman of the Board, on August 31st, 2016. The Life Insurance Association
designated Mr. Lin Jin shu, the Deputy General Manager of Cathay Life, as
secretary general by resolution of the board of directors on October 6th, 2016.

3. FSC Lowered down floor of Personal-injury Insurance Risk Rate
Due to the fact that the actual mortality rate of personal -injury insurance remains
steady during recent years, the FSC managed to reduce the lower limit of risk rateof master and rider contract to 2.4543 per 10 thousand (i.e., 30% of 8.181 per 10
thousand) since January 1st of 2017 for fair market rate; in accordance with theaforementioned, FSC set upper limit of risk rate at 6.5448 per 10 thousand (i.e., 80%of 8.181 per 10 thousand) as fair interval in product design. Also, FSC permitted

insurers, with agreement from policyholders, may increase insurance amount under
the circumstance that premium sum remains the same.
Such revisions in personal-injury insurance rate are expected to provide
alternatives (premium decrease or amount increase)for policyholders with adequate
protection.
The Life Insurance Association of the Republic of China

Thailand

1.Overview of Life Insurance in Thailand for 2016
The Thai life insurance industry continued to grow in the year 2016. The grand total
premium from January 1, 2016 – October 30, 2016 was 458,825.23 million baht witha growth rate of 5.78%. The total premium was composed of New Business Premium(130,624.12 million baht) and Renewal Premiums (328,201.11 million baht), thepersistency rate was 83%. The premium income comprises New Business Premiums
were (1) the first year premium was 90,542.44 million baht and (2) the single
premium was 40,081.67 million baht. Most importantly, the growth of life insurance
business in Thailand is due to the help and support from the Office of InsuranceCommission (OIC).
2.The International Financial Reporting Standard (IFRS4 Phase 1 : Insurance
Contract)
Insurance Business in Thailand has started “IFRS4 Phase 1: Insurance Contract”
since 1 January 2559 for record the accounting to international standards. The
contract will be divided into two parts (1) Insurance Contract (2) Investment
Contract and has specified to Liability Adequacy Test. Due to the interest rate inmarket has low rate, therefore it have effect for discount rate in business sector toused Liability Adequacy Test and make business sector has setting more the debt.
Also, business sector has established a working group to study the impact andpropose the measures to support this case including specify discount rate for
Liability Adequacy Test with the government sector as follow:-

LAT discount rate = GPV blended yield curve (RBC Yield) + Illiquidity
premium calculated risk – free yield curve with the current interest rate whichrefer from discount rate method of RBC-

Used Illiquidity premium = Min (150 bps, Max [40% spread, 20 bps]) whichrefer from Credit spread of private debenture which has level of reliability A atthe date of assessment.

3.Supporting for Digital Insurance
Nowadays, consumers have tendency changing behavior to use more communication
channels and more searched data from digital. Thus, life insurance business has
seen a channel to communicate to get quickly information with consumers including
reduction procedure to be modern and convenient for lifestyle of people today.
Therefore, The Thai Life Assurance Association (TLAA) has established a working

group to study and develop in business sector through electronics channel. The
project “Fintech” (Financial and Technology) is technology of accounting to develop
and push life insurance industry to digital insurance in concrete with support forthe preparation of an integrated approach in collaboration with government such as
the department of provincial administration, Bank of Thailand, the Stock Exchange
and private sector which focus to create value and making potential in international
competition.
The Thai Life Assurance Association

Japan1. Enforcement of the Revised Insurance Business Act
Amid the rapid development of the diversification of the distribution channels
which include internet sales and insurance shops, the revised Insurance Business
Act was implemented on May 29, 2016 to adjust the existing regulation suited tothe actual situation.
There are two main revisions made to the act: Ascertainment of Customer's
Intention and Obligation of Provision of Information.
Ascertainment of Customer’s Intention refers to the obligation that any insurance
sales person has to ascertain customer’s needs and in line with this he/she has topropose products which meet such needs. Customer’s confirmation that thecustomer’s intention is in accord with the product proposed by the sales person isrequired ultimately.
Obligation of Provision of Information is that providing the information on products
which considered as a base for customers decision on the purchase of insurance
products became mandatory. Such necessary information includes insurance
premium, policy term, policy amount, and payment conditions for insurance claims.
Providing information has become required practice in order to actively help
customers decision more than ever.
2. Succession of Suspending the Sales of Saving-type Products due to Difficulty in
Asset Management
As can be seen in the Bank of Japan’s negative interest rate policy introduced
earlier this year, historical low interest rates hit hard life insurance companies’
asset management. Since Japanese Government Bond is the main choice of theinvestment for single premium whole life insurance, which guarantees a certain
yield to policyholders, many companies stop selling such products or lower theassumed interest rates.
3. Disclosure of Bancassurance Fees/Commissions
With the negative interest rate policy implemented by the Bank of Japan puttingpressure on banks’ business, FSA was concerned that more banks would try to sell
insurance products that skewed to high profit margin on sales rather thancustomer needs. As a result of the FSA’s persistent request to banks, most banks
agreed to disclose their sales commissions received from life insurance companies
from October.
Oriental Life Insurance Cultural Development Center