Print Time:2021/10/17 00:19
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Chapter Law Content

Title: Insurance Act CH
Category: Financial Supervisory Commission(金融監督管理委員會)
Chapter V. Insurance Enterprises
Section 5. Penal Provisions
Article 166
(Penal Provisions for Engaging in the Business of Insurance Without Approval)
Enterprises that engage in the business of insurance without obtaining approval from the competent authority in accordance with the provisions of Article 137 of this Act shall be ordered to suspend business, and shall be assessed an administrative fine of not less than New Taiwan Dollars three million but not more than New Taiwan Dollars thirty million.
Article 166-1
(Penal Provisions for Spreading Rumors or Applying Illegitimate Tactics to Smear an Insurance Enterprise’s Credit)
People who spread rumors or apply illegitimate tactics to smear an insurance enterprise or the credit of a foreign insurance enterprise will be sentenced up to 5 years in prison, which may be offset with a fine of no more than NTD 10 million.
Article 167
(Penal Provisions for a Non-insurance Enterprise Engaging in the Operation of Insurance Business)
A non-insurance enterprise that engages in the operation of insurance business shall be punished by a prison term of not less than three years but not more than 10 years, and in addition may be assessed a criminal fine of not less than New Taiwan Dollars 10 million but not more than New Taiwan Dollars two hundred million. Where the properties or property interests obtained through the commission of an offense are valued at New Taiwan Dollars one hundred million or more, such person shall be punished by a prison term of not less than seven years, and in addition may be assessed a criminal fine of not less than New Taiwan Dollars twenty-five million but not more than more than New Taiwan Dollars five hundred million.
Where a juristic person’s representative, agent, employee or other staff commits the offense described in the preceding paragraph when practicing business, the offender shall be punished and said fine shall be imposed on the juristic person too.
Article 167-1
(Penal Provisions)
Any person who provides agent, broker, surveyor services for insurance enterprises or foreign insurance enterprises not approved under the Act shall be subject to a prison term of not more than three (3) years, and in addition thereto, a fine of not less than New Taiwan Dollars three million (NT$3,000,000) but not more than New Taiwan Dollars twenty million (NT$20,000,000). For violations deemed severe, the competent authority may order the violating insurance agent, broker, surveyor, or the bank operating the insurance agent or insurance business concurrently to suspend business, in whole or in part, or revoke the offender’s practice license.
Where a juristic person’s representative, agent, employee or other staff commits the offense described in the preceding paragraph when practicing business, the offender shall be punished and said fine shall be imposed on the juristic person too.
Any person who operates or practices the business of an insurance agent, broker or surveyor without a practice license is subject to a fine of not less than New Taiwan Dollars nine hundred thousand (NT$900,000) but not more than New Taiwan Dollars nine million (NT$9,000,000).
Article 167-2
(Penal Provisions)
In case of a violation of the regulations set forth in accordance with Paragraph 4 of Article 163 herein regarding financial or business management, or Paragraph 7 of Article 163 herein, or a violation of Paragraph 1 of Article 165 or Paragraph 5 of Article 163 applying said requirements mutatis mutandis herein, a time limit for rectification shall be specified, and in addition thereto, an administrative fine of not less than New Taiwan Dollars one hundred thousand (NT$100,000) but not more than New Taiwan Dollars three million (NT$3,000,000) may also be assessed. For violations deemed severe, an order may be issued to revoke the offender’s permit and cancel his or her practice license.
Article 167-3
(Penal Provisions)
In case of a violation of Paragraph 3 of Article 165 herein or Paragraph 5 of Article 163 applying said requirements mutatis mutandis herein or failure to establish or implement internal control systems, audit systems, business solicitation systems or procedures, a time limit for rectification shall be specified, and in addition thereto, an administrative fine of not less than New Taiwan Dollars one hundred thousand (NT$100,000) but not more than New Taiwan Dollars three million (NT$3,000,000).
Article 167-4
(Penal Provisions)
When the competent authority dispatches officers to inspect the financial or business conditions of an insurance agent, broker, surveyor, or a bank operating the insurance agent or insurance broker business concurrently, or order an insurance agent, broker , surveyor or a bank operating the insurance agent or insurance broker business concurrently to report the condition of its business within a specified time limit pursuant to Paragraph 5 of Article 163 herein, Paragraph 4 of Article 165 herein to which Article 148 applies mutatis mutandis, a fine of not less than New Taiwan Dollars three hundred thousand (NT$300,000) but not more than New Taiwan Dollars three million (NT$3,000,000) will be imposed on the insurance agent, broker, surveyor or bank operating the insurance agent or insurance broker business concurrently if the insurance agent, broker or surveyor himself/herself or an responsible person or employee of the insurance agent, broker or surveyor, or the departmental supervisor, vice supervisor, or employee of the bank operating the insurance agent or insurance broker business concurrently has any of the situations: The person-in-charge may be dismissed under severe circumstances.
1. Refusing to allow inspection or to open the safe or other storage rooms.
2. Concealing or destroying account books or documents related to the business or financial conditions of the insurance agent, broker or surveyor.
3. Refusing to respond to, or making false representation in response to an inspector’s queries without cause.
4. Missing the deadline for submission of financial reports, property list, or other related information and reports, or making false or incomplete representations, or missing the deadline for payment of inspection fees.
Where the competent authority dispatches an officer to conduct inspection of an affiliate of an insurance agent, broker, surveyor or bank operating the insurance agent or insurance broker business concurrently, or any other financial institution related thereto pursuant to Paragraph 5 of Article 163 herein, and Paragraph 4 of Article 165 herein to which Article 148 applies mutatis mutandis, the inspected entity that is remiss in submitting the financial statements, account books, documents, or relevant transaction records shall receive a fine of not less than New Taiwan Dollars three hundred thousand (NT$300,000) but not more than New Taiwan Dollars three million (TWD3,000,000).
Article 167-5
(Penal Provisions)
An insurance enterprise that has business dealings with an insurance agent, broker or surveyor as described in Paragraph 3 of Article 167-1 herein shall be subject to a fine of New Taiwan Dollars one million five hundred thousand (NT$1,500,000) but not more than New Taiwan Dollars fifteen million (NT$15,000,000).
Article 168
(Penal Provisions for Violating the Provisions Related to Business Scope or Funds Allocations)
If an insurance enterprise violates the provisions of Article 138, paragraph 1, 3, or 5, or the provisions relating to business scope in regulations prescribed by the competent authority pursuant to Article 138, paragraph 2, an administrative fine of not less than New Taiwan Dollars nine hundred thousand but not more than nine million shall be imposed.
If an insurance enterprise violates the provisions of Article 138-2, paragraph 2, 4, 5, or 7, or Article 138-3, paragraph 1 or 2, or the provisions relating to the amount to be provisioned for the compensation reserve fund and the manner of such provisioning as set out in regulations prescribed by the competent authority pursuant to paragraph 2 of that same article, an administrative fine of not less than New Taiwan Dollars nine hundred thousand but not more than nine million shall be imposed; where the circumstances are severe, the enterprise's permit to engage in insurance trust business may also be revoked.
Where an insurance enterprise violates the provisions of Article 143, an administrative fine of not less than New Taiwan Dollars nine hundred thousand but not more than New Taiwan Dollars nine million shall be imposed.
Where an insurance enterprise violates Article 143-5 herein, or the competent authority takes measures in accordance with Article 143-6 herein, an administrative fine of not less than New Taiwan Dollars two million but not more than New Taiwan Dollars twenty million shall be imposed.
Where any one of the following circumstances obtains with respect to the funds allocation of an insurance enterprise, an administrative fine of not less than New Taiwan Dollars ten hundred thousand but not more than New Taiwan Dollars ten million shall be imposed, or the enterprise shall be ordered to dismiss its responsible person; where the circumstances are severe, its business permit may also be revoked:
1.A violation of Article 146, paragraph 1, 3, 5, or 7, or the provisions relating to administration and custody of special ledgers or the allocation of investment assets as set out in regulations prescribed by the competent authority pursuant to paragraph 6 of that same article, or a violation of provisions relating to the terms and conditions of derivatives trading by insurance enterprises, the scope thereof, transaction limits, or internal handling procedures as set out in regulations prescribed by the competent authority pursuant to paragraph 8 of that same article.
2.A violation of Article 146-1, paragraph 1, 2, or 3, or the provisions relating to eligibility conditions, scope and type of investments, and investment rules as set out in regulations prescribed by the competent authority pursuant to paragraph 5 of that same article; or a violation of Paragraph 3 or 4 of Article 146-5.
3.A violation of the provisions of Article 146-2 paragraph 1, 2, or the provisions relating to restrictions and qualifications for investments in real estate as set out in regulations prescribed by the competent authority pursuant to paragraph 4 of that same article.
4.A violation of the provisions of Article 146-3, paragraph 1, 2, or 4.
5.A violation of Article 146-4, paragraph 1 or 2, or the provisions relating to investment rules or investment limits as set out in regulations prescribed by the competent authority pursuant to paragraph 3 of that same article.
6.A violation of the forepart of paragraph 1 of Article 146-5 by making investments without approval of the competent authority or required documentation or procedures for subsequent reviews, or of the provisions relating to scope of or limits upon allocations and investments as set out in regulations prescribed by the competent authority pursuant to the latter part of that same paragraph.
7.A violation of Article 146-6, paragraph 1 or 2, or the provisions relating to the method of reporting investments as set out in regulations prescribed by the competent authority pursuant to paragraph 3 of that same article.
8.A violation of the provisions of Article 146-9, paragraph 1, 2, or 3.
Where a secured loan made by an insurance enterprise under Article 146-3, paragraph 3 or Article 146-8, paragraph 1 is not fully secured or the conditions are better than those extended to other loanees of the same class, the person responsible for the act shall be sentenced to imprisonment for not more than three years or detention, and in addition may be assessed a criminal fine of not more than New Taiwan Dollars twenty million.
Where a secured loan made by an insurance enterprise under Article 146-3, paragraph 3 or Article 146-8, paragraph 1 reaches or exceeds the monetary amount prescribed by the competent authority without approval by three-quarters of the directors present at a board of directors meeting attended by at least two-thirds of the directors, or where an insurance enterprise violates the provisions relating to loan limits and aggregate loan balances as set out in regulations prescribed by the competent authority pursuant to Article 146-3, paragraph 3, the person responsible for the act shall be assessed an administrative fine of not less than New Taiwan Dollars two million but not more than New Taiwan Dollars twenty million.
If an insurance enterprise violates the provisions relating to limits on loans or other transactions as set out in regulations prescribed by the competent authority pursuant to Article 146-7, paragraph 1, or of the provisions relating to procedures for the adoption of resolutions or limits on transaction size as set out in regulations prescribed by the competent authority pursuant to Article 146-7, paragraph 3, an administrative fine of not less than New Taiwan Dollars two million but not more than twenty million shall be imposed.
Article 168-1
(Penal Provisions for Impeding the Financial Inspection)
Where the competent authority, pursuant to Article 148, dispatches an officer or commissions an appropriate institution or expert to inspect the business and financial conditions of an insurance enterprise, or orders an insurance enterprise to report the status of its business within a specific time limit, a responsible person or an employee of the insurance enterprise who commits any of the following acts shall be assessed an administrative fine of not less than New Taiwan Dollars one million and eight hundred thousand but not more than New Taiwan Dollars eighteen million: The person-in-charge may be dismissed under severe circumstances.
1. Refusing to allow inspection or to open the safe or other storage areas.
2. Concealing or destroying account books or documents related to the enterprise's business or financial conditions.
3. Refusing to respond to, or making false representation in response to, an investigator's queries without cause.
4. Missing the deadline for submission of financial reports, a list of assets, or other related information and reports, or in submitting such items, making false or incomplete representations, or missing the deadline for payment of inspection fees.
Where the competent authority dispatches an officer to conduct inspection pursuant to Article 148, paragraph 4, an affiliate of the insurance enterprise, or any other financial institution related thereto, that fails to submit the financial statements, account books, documents, or relevant transaction records shall be assessed an administrative fine of not less than New Taiwan Dollars one million eight hundred thousand but not more than New Taiwan Dollars eighteen million.
Article 168-2
(Penal Provisions)
Where a responsible person or employee of an insurance enterprise, or any person using another person's name to make investments through which he or she is able to directly or indirectly control the personnel, financial, or business operations of an insurance enterprise, operates the insurance enterprise improperly with intent to reap illegal gains for himself/herself or a third party or to harm the interests of the insurance enterprise, and by such action harms property or interests of the insurance enterprise, shall be sentenced to a prison term of not less than three years but not more than 10 years, and in addition thereto, may also be assessed a criminal fine of not less than New Taiwan Dollars 10 million but not more than New Taiwan Dollars two hundred million. Where the properties or property interests obtained through the commission of an offense are valued at New Taiwan Dollars one hundred million or more, such person shall be punished by a prison term of not less than seven years, and in addition may be assessed a criminal fine of not less than New Taiwan Dollars twenty-five million but not more than more than New Taiwan Dollars five hundred million.
Where two or more responsible persons or employees of an insurance enterprise, or persons using other people's names to make investments through which they are able to exercise direct or indirect control over the personnel, financial, and business matters of an insurance enterprise, act jointly in committing a crime described in the preceding paragraph, the penalty may be increased by up to one-half.
Any attempted offense described in paragraph 1 shall be punishable.
Article 168-3
(Penal Provisions)
A person who commits an offense as set out in Article 167 or Article 168-2, subsequently voluntarily surrenders himself or herself before the offense is discovered and voluntarily hands over the entire proceeds of crime, shall have his or her punishment reduced or remitted. Where another principal offender or an accomplice is captured as a result, his or her punishment shall be remitted.
A person who commits an offense as set out in Article 167 or Article 168-2, confesses during the prosecutorial inquiry and voluntarily hands over the entire proceeds of crime, shall have his or her punishment reduced. Where another principal offender or an accomplice is captured as a result, his or her punishment shall be reduced by one-half.
Where the value of properties or property interests obtained by a person through the commission of an offense as set out in Article 167 or Article 168-2 exceeds the maximum amount of the criminal fine, the fine may be increased up to the value of the properties or property interests obtained through the commission of the offense; if the offense harms the stability of the insurance market, the fine shall be increased by one-half.
Article 168-4
(Confiscating Proceeds of Crime)
Proceeds of crime obtained by an offender or a natural person, legal person or unincorporated body other than the offender through commission of an offense under this Act under any circumstance provided in Paragraph 2, Article 38-1 of the Criminal Code shall be confiscated, except for portions that should be returned to the victims or persons entitled to claim damages.
Article 168-5
(Penal Provisions)
Where a criminal fine assessed for an offense under this Act is New Taiwan Dollars fifty million or more and the offender lacks the ability to pay it in full, it shall be commuted to labor for a period of not more than two years, to be calculated by the ratio of the total amount of the fine to the number of days in two years; where the criminal fine assessed is New Taiwan Dollars one hundred million or more and the offender lacks the ability to pay it in full, it shall be commuted to labor for a period of not more than three years, to be calculated by the ratio of the total amount of the fine to the number of days in three years.
Article 168-6
(Penal Provisions)
Where "a responsible person or employee of an insurance enterprise, or any person using another person's name to make investments through which he or she is able to directly or indirectly control the personnel, financial, or business operations of an insurance enterprise" as set forth in Article 168-2, paragraph 1 does any gratuitous act that is prejudicial to the rights of an insurance enterprise, the insurance enterprise may petition a court to revoke the act.
Where "a responsible person or employee of an insurance enterprise, or any person using another person's name to make investments through which he or she is able to directly or indirectly control the personnel, financial, or business operations of an insurance enterprise" as set forth in the preceding paragraph does any non-gratuitous act knowing at the time of the act that it is prejudicial to the rights of an insurance enterprise and the beneficiary of the act also knows the circumstances at the time the benefit is received, the insurance enterprise may petition a court to revoke the act.
A party petitioning for revocation in accordance with either of the preceding two paragraphs may also petition the court to order the beneficiary or any party to whom the benefit is transferred to restore the status quo ante, provided this does not apply where the party to whom the benefit is transferred was not aware at the time of transfer that there was cause for revocation.
Any disposition of property between "a responsible person or employee of an insurance enterprise, or any person using another person's name to make investments through which he or she is able to directly or indirectly control the personnel, financial, or business operations of an insurance enterprise" as set forth in paragraph 1 and such a person's spouse, lineal relative, cohabiting relative, head of household, or family member shall be deemed a non-gratuitous act.
Any disposition of property between "a responsible person or employee of an insurance enterprise, or any person using another person's name to make investments through which he or she is able to directly or indirectly control the personnel, financial, or business operations of an insurance enterprise" as set forth in paragraph 1 and any person other than those set forth in the preceding paragraph shall be presumed to be a non-gratuitous act.
The right of revocation under paragraphs 1 and 2 shall be extinguished one year after the time the insurance enterprise learns there is cause for voidance if the insurance enterprise fails to exercise, or 10 years after the time of the act.
Article 168-7
(Penal Provisions)
The crimes set forth in Article 168-2, paragraph 1 are serious crimes as defined in Article 3, paragraph 1 of the Money Laundering Control Act.
Article 169
(Penal Provisions for Over Insurance)
If an insurance enterprise violates the provisions of Article 72 of this Act by underwriting insurance in excess of the value of the subject matter insured, the portion in violation shall become void, and the offense shall also be punished by an administrative fine of not less than New Taiwan Dollars four hundred fifty thousand but not more than New Taiwan Dollars four million fifty hundred thousand.
Article 169-1
(Deleted)
(Deleted)
Article 169-2
(Penal Provisions for Violating the Provisions of Contributions to the Stabilization Funds)
An insurance enterprise found with one of the following conditions will be reported by the stabilization fund to the competent authority for a fine of NTD 300 thousand to NTD 3 million at maximum. The person-in-charge may be dismissed under severe circumstances.
I. It fails to make contributions to the stabilization fund or refuses to pay for it.
II. It violates the provisions of Article 143-3, Paragraph 5 by failing to create electronic data files or refusing to provide electronic data files as required, or providing electronic data files that are seriously untrue.
III. It circumvents, obstructs with, or refuses inspections performed by the stabilization fund in accordance with the provisions of Article 143-3, Paragraph 6.
Article 170
(Deleted)
(Deleted)
Article 170-1
(Penal Provisions)
Where an insurance enterprise violates the provisions relating to the manner in which insurance enterprises cede or assume reinsurance or operate other risk spreading mechanisms, or limits applying thereto, as set out in regulations prescribed by the competent authority pursuant to Article 147, an administrative fine of not less than New Taiwan Dollars nine hundred thousand but not more than nine million shall be imposed.
If a professional reinsurance enterprise violates the provisions relating to business scope or financial management as set out in regulations prescribed by the competent authority pursuant to Article 147-1, paragraph 2, an administrative fine of not less than New Taiwan Dollars nine hundred thousand but not more than nine million shall be imposed.
Article 171
(Penal Provisions for Violating the Provisions of Premium Rates and Reserve)
An insurance enterprise that violates the provisions of Paragraphs 1~4 of Article 144 herein, or Article 145 herein shall be assessed an administrative fine of not less than New Taiwan Dollars six hundred thousand but not more than New Taiwan Dollars six million, and in addition thereto may be ordered to remove and replace its underwriters or actuaries.
Where the certified actuary or external verification actuary appointed or employed by an insurance enterprise violates Paragraph 5 of Article 144 herein, the competent authority may, according to the severity of the circumstances, issue a warning, suspend the actuary from providing certification or verification services for three years, or order the insurance enterprise to replace the actuary.
Article 171-1
(Penal Provisions)
An insurance enterprise that violates the provisions of Article 148-1, paragraph 1 or 2 shall be assessed an administrative fine of not less than New Taiwan Dollars six hundred thousand but not more than New Taiwan Dollars six million.
An insurance enterprise that violates the provisions of Article 148-2, paragraph 1 by not making explanatory documents publicly available for inspection, or submitting explanatory documents that do not contain required information, or submitting explanatory documents containing misrepresentations, shall be assessed an administrative fine of not less than New Taiwan Dollars six hundred thousand but not more than New Taiwan Dollars six million.
An insurance enterprise that violates the provisions of Article 148-2, paragraph 2 by failing to report to the competent authority or to provide a public explanation within the specified time period, or by making false representations in its reports to the competent authority or public explanations, shall be assessed an administrative fine of not less than New Taiwan Dollars three hundred thousand but not more than New Taiwan Dollars three million.
An insurance enterprise that violates the provisions of Article 148-3, paragraph 1 by failing to establish or enforce internal control or auditing systems shall be assessed an administrative fine of not less than New Taiwan Dollars six hundred thousand but not more than New Taiwan Dollars twelve million.
An insurance enterprise that violates the provisions of Article 148-3, paragraph 2 by failing to establish or enforce internal handling systems or procedures shall be assessed an administrative fine of not less than New Taiwan Dollars six hundred thousand but not more than New Taiwan Dollars twelve million.
Article 171-2
(Penal Provisions)
Shareholders of an insurance company that violate the provisions of Article 139-1, paragraph 1, 2 or 4 by acquiring shares without reporting to or obtaining approval from the competent authority shall be assessed an administrative fine of not less than New Taiwan Dollars four hundred thousand (NT$400,000) but not more than New Taiwan Dollars four million (NT$4,000,000).
Shareholders of an insurance company that violate the provisions of Article 139-1, paragraph 5 concerning reporting or announcement of shareholding and other important changes or violate the provisions of paragraph 6 of the same article by failing to dispose of shares within a given time period shall be assessed an administrative fine of not less than New Taiwan Dollars four hundred thousand (NT$400,000) but not more than New Taiwan Dollars four million (NT$4,000,000).
Shareholders of an insurance company that violate the provisions of Article 139-1, paragraph 7 by failing to make notification shall be assessed an administrative fine of not less than New Taiwan Dollars one hundred thousand (NT$100,000) but not more than New Taiwan Dollars one million (NT$1,000,000).
Article 172
(Penal Provisions for Delays in Liquidation)
If an insurance enterprise that has had its registration voided or business permit revoked delays in carrying out liquidation procedures, each responsible person may be assessed an administrative fine of not less than New Taiwan Dollars six hundred thousand but not more than New Taiwan Dollars six million.
Article 172-1
(Penal Provisions for Violating the Supervisory Ordinance)
When an insurance enterprise has been ordered by the competent authority into conservatorship, receivership, or suspension of business and rehabilitation, the directors, supervisors, managers, or other staff of the insurance enterprise shall, under any of the following circumstances, be sentenced to imprisonment of not less than one year but not more than seven years, and may in addition be assessed a criminal fine of not more than New Taiwan Dollars twenty million:
1. It refuses to transfer to the conservator, receiver, or rehabilitator account books and documents, seals, and a list of assets related to the insurance enterprise's business and financial matters, or fails to transfer them completely.
2. It conceals or destroys account books or documents related to business matters, conceals or destroys assets of the insurance enterprise, or otherwise disposes thereof to the detriment of creditors' rights.
3. It counterfeits a debt or acknowledges false debts.
4. It refuses to respond to the inquiries of the conservator, receiver or rehabilitator without cause, or responds with untrue answers, thereby affecting the rights and interests of insured persons or beneficiaries.
Article 172-2
(Failing to Make Corrections Within the Period to Mete Out Penalties)
If an insurance enterprise or the punished person, after having been punished in accordance with the provisions of this Section, fails to make corrections within the time period provided, the competent authority may mete out penalties each time a violation occurs.
Fine for an act under this Section may be remitted if the act was committed in a trivial circumstance for which it is considered appropriate not to punish.
Article 173
(Deleted)
(Deleted)
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