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Taiwan Insurance Institute

Introduction * CALI Task Force * Information Processing Center

Compulsory Automobile Liability Insurance Actuarial and Research Development Task Force

I. Preface

In order to further improve the Compulsory Automobile Liability Insurance (CALI) system and collaborate better with the planning and studying, the competent authority entrusted Taiwan Insurance Institute (TII) to carry out researches related to the CALI in October 2005. Consequently, TII established "CALI Actuarial and Research Development Task Force (the "CALI Task Force")," which consists of four working groups. The working groups are: ratemaking and statistic working group, reserving and financial accounting working group, IT working group, and laws and regulations working group. The 4 work groups have been integrated into 2 work groups starting from 2015 fiscal year, which are the group of actuary and finance and accounting work, and, respectively, to continuously conduct the study and execution of relevant topics of this insurance actuary, reserve funds, as well as laws and regulations, in order to benefit the long-term development of CALI's insurance.

II. Main Missions

  1. To conduct rate review and the analysis and control of loss ratio so that the insured can enjoy a fair and reasonable premium rate.
  2. To reevaluate annually the adequacy of reserves, thus ensuring the long-term development of the CALI.
  3. To fulfill the implementation of independent accounting scheme for the CALI exactly.
  4. To assess and improve the CALI related laws and regulations in order to enhance insurers' operation of the CALI and realize the protection of consumer rights.

III. Main Missions Achieved

  1. Regular rate reviewing
    Review the net premium of the CALI and expenses loading from each item in order to ensure that CALI premium qualifies the principles of fairness, reasonability, and adequacy.
  2. Regular monitoring and discussion on loss ratios
    Control effectively the loss cost of the CALI through examining and analyzing each insurance company and the overall industry's loss ratios and development trends.
  3. Regular discussion on the CALI various reserves and monitoring on the reserve adequacy
    Analyze the adequacy of the CALI various reserves and forecast the changes of reserves for strengthening the overall financial stability of the CALI.
  4. Study on the independent accounting scheme
    Studied the implementation of independent accounting scheme.
  5. Establishment and assessment of the inquiry mechanism
    Build inquiry systems in the information processing center which can be used by insurance companies, insurance brokers and agents. The information processing center should deliver premium-related information under the requirements of the Personal Data Protection Law.
  6. Reviewing and researching on the CALI Act
    Strengthen the protections for consumers and victims in traffic accidents through reviewing the CALI Act which enables further improvement on the CALI operation.
  7. Establishment of related mechanisms
    Establish "Differentiation Supervision Mechanism" and "Comprehensive Audit Mechanism" in order to understand and to help improve each insurance company's operation of the CALI.
  8. Reviewing the Actuarial Report of CALI
    Provide the analyzed data and reviewed results to the competent authority to understand the situation of the reserves management by reviewing the Actuarial Report.