As of the end of June in 2013, a number of insurance business firms (including insurance agents and brokers) have been punished by the competent authority in 31 cases of offenses, and the fines involved amounted to NT$41.88 million. These insurance firms covered the businesses of property insurance companies, life insurance companies, insurance agents, and insurance brokers. The main cause of the punitive action was the failure to comply with the applicable legal rules, to the extent that punishment was given.
Compliance is a matter of preventive measure, which entails the monitoring of the enterprise in abiding by applicable legal rules in its operations. Under the system of compliance, applicable legal rules and the internal code of the company will be identified and updated regularly. In addition, related segments of the company shall engage in internal communications for assessment of the proper enforcement of the compliance system, with the final proposal of running the system in conformity with legal requirements. Through the process of the compliance system, applicable legal rules can be fully understood by related functional units of the company effectively. This is the only way to ensure compliance with applicable legal rules and eliminate anticipated legal risk.
In this study, the review and analysis of literature, inductive analysis, and comparative methods will be used. First, related literature will be reviewed and summarized as the theoretical foundation of credit rating, corporate governance, and compliance. Secondly, applicable legal rules will be described and elucidated through inductive and comparative methods. Finally, the feasibility of a compliance system applicable to the insurance industry will be induced. This study is an attempt to serve as a reference for the insurance
industry of Taiwan in performing corporate governance in its entirety.