To implement Paragraph 1 of Article 146-2 of the Insurance Act, the FSC has been reviewing the relevant regulations on the real estate investment of insurance enterprises, depending on changes in economic and financial circumstances and the actual investment made by insurance enterprises, from time to time since 2009. The FSC amended the "Interpretative Letter for the Standards and Rules for Investments in Real Estate by an Insurance Enterprise that can be Used Immediately and from Which Benefits may be Derived", per the letter Ref. No. Jin-Guan-Bao-Cai-Zi No. 10402507211 dated 8 December 2015. The main points are as follows:
- Amended the formula for calculating a reasonable rate of return on investment:
The real estate invested by an insurance company, which is usable and has been utilized and has a reasonable rate of return on investment can be recognized as available for utilization immediately and from which benefits may be derived. The foregoing "reasonable rate of return on investment" has been adjusted to mean the annualized rate of return on real estate investment which shall not be lower than the floating interest rate of a 2-year time deposit of a small amount, as posted by Chunghwa Post Co., Ltd. plus 1.25 percentage points.
- This amendment stipulated that after an insurance company invests in real estate, if the insurance company is unable to comply with the standards for real estate that can be utilized immediately and from which benefits may be derived, the insurance company may postpone the period for immediate utilization pursuant to certain laws and regulations.