Regulations Governing Derivatives Transactions Conducted by Insurance Companies Article 13
The following information shall be involved in the processing procedure for derivatives transactions, and the formation and alteration of the abovementioned procedure shall be carried out with auditors, senior executives of legal compliance and risk management agencies as well as relevant supervisors involved in:1. Transaction principles and policies, including the types of derivatives transactions, major counterparties, trading strategies (including strategies for hedging purpose, enhancing the investment efficiency and transactions of structured products), overall and individual position limits;2. Operational procedure, including the responsible management level, department in charge, authority limits, division of powers and duties and transaction procedure;3. Internal control system, including the risk identification and assessment, assessment of legality, operation and management rules and regulations, transaction record keeping procedure, assessment method and frequency, irregularity reporting system;4. Internal audit system, including internal audit framework, audit frequency, audit scope, audit report submission procedure and follow-up of improvement of deficiencies;5. Accounting system, including book keeping and entry processing procedure, recognition of profit and loss, and disclosures in financial statement;6. Risk management system, which shall include the identification, assessment, monitoring and reporting of transaction risks which shall at least include credit, market, liquidity, operational, legal and system risks.7. Counterparty risk, which requires that when conducting over-the-counter transactions, the insurer shall perform credit risk assessment on the counterparties and assign to individual counterparties different transaction limits according to their credit positions, and the transaction limits shall be subject to constant monitoring; and8. The items must be reported to the board of directors and risk management committee on a regular basis as indicated in Paragraph 2.An insurer shall at a minimum report to the board of directors and the risk management committee on a regular basis as follows:1. Items to be reported:(1) Total and net amount of contracts with the obligations which have not become due as well as unrealized gain or loss evaluated in accordance with the fair value;(2) Compliance with the Procedure for Derivatives Transactions;(3) Performance and risk assessment reports on the derivatives transactions.(4) When a hedged item is anticipated investment position and the hedging effectiveness obtained for the expected portfolio differs from that for the actual portfolio by 20% or more, differences in and reasons for the hedging effectiveness as mentioned above shall be reported.2. Reporting frequency:(1) Reports about transactions for hedging purpose and transactions of structured products must be made to the board of directors and the risk management committee at least once every six months.(2) Reports about transactions for enhancing the investment efficiency must be made to the risk management committee and the board of directors or its authorized unit at least once a month. However, when the following conditions are met, reports to the board of directors and the risk management committee can be made on a quarterly basis:(i) Immature transactions are engaged in pursuant to Article 8 and internal insurance company database is available to store related transaction information.(ii) The sum of realized and unrealized losses for the effective period of any transaction in (i) does not exceed NTD50 million or 0.1% of the insurer’s stockholder's equitiy, whichever is lower.(iii) The sum of realized and unrealized losses for the effective periods of all transactions in (i) does not exceed NTD100 million or 0.2% of the insurer’s stockholder's equitiy, whichever is lower.
中文原文 保險業從事衍生性金融商品交易管理辦法第13條
保險業訂定從事衍生性金融商品交易處理程序，應有稽核、法令遵循與風險管理單位之高階主管人員及相關業務主管共同參與訂定或修正，並載明下列項目：
一、交易原則與方針：應包括從事衍生性金融商品交易之種類、主要交易對象、交易策略（包括避險目的、增加投資效益目的、結構型商品投資）、全部及個別部位限額設定。
二、作業程序：應包括負責層級、執行部門、授權額度、權責劃分及交易流程。
三、內部控制制度：應包括風險辨識及評估、適法性評估、作業及管理規章、交易紀錄保存程序、評價方法及頻率、異常情形報告系統。
四、內部稽核制度：應包括內部稽核架構、查核頻率、查核範圍、稽核報告提報程序及缺失改善追蹤。
五、會計處理制度：應包括會計帳務與分錄處理程序、損益認列及財務報告之揭露。
六、風險管理制度：應包括交易風險之辨識、衡量、監控及報告，交易風險至少應包括信用、市場、流動性、作業、法律及系統風險等項目。
七、交易對手風險：從事店頭市場交易時，應對交易對手進行信用風險評估，並依個別交易對手之信用狀況，訂定交易額度限制，並隨時控管之。
八、第二項所列之定期向董（理）事會及風險管理委員會報告事項。
保險業至少應依下列規定，定期向董（理）事會及風險管理委員會報告：
一、報告項目：
（一）未到期交易之總額、淨額及依公平價值評估之未實現損益。
（二）遵守從事衍生性金融商品交易處理程序情形。
（三）衍生性金融商品交易之績效評估及風險評估報告。
（四）從事被避險項目為預期投資部位之避險衍生性金融商品交易，按預期投資組合與實際投資組合計算之避險有效性差異數達百分之二十以上者，應報告上開避險有效性差異之情形及理由。
二、報告頻率：
（一）從事避險目的及結構型商品投資之衍生性金融商品交易者，至少應每半年向董（理）事會及風險管理委員會報告。
（二）從事增加投資效益目的之衍生性金融商品交易者，至少應每月向風險管理委員會報告後，向董（理）事會或其授權之單位報告。
但符合下列條件者，至少應按季向董（理）事會及風險管理委員會報告：1.未到期交易屬依第八條規定辦理且保險業內部已建置資料庫儲存交易相關資訊之交易。
2.前１、任一交易存續期間內之已實現及未實現損失之合計金額，未逾新臺幣五千萬元與該保險業業主權益百分之零點一兩者間孰低者。
3.１、全部交易存續期間內之已實現及未實現損失之合計金額，未逾新臺幣一億元與該保險業業主權益百分之零點二兩者間孰低者。
一、交易原則與方針：應包括從事衍生性金融商品交易之種類、主要交易對象、交易策略（包括避險目的、增加投資效益目的、結構型商品投資）、全部及個別部位限額設定。
二、作業程序：應包括負責層級、執行部門、授權額度、權責劃分及交易流程。
三、內部控制制度：應包括風險辨識及評估、適法性評估、作業及管理規章、交易紀錄保存程序、評價方法及頻率、異常情形報告系統。
四、內部稽核制度：應包括內部稽核架構、查核頻率、查核範圍、稽核報告提報程序及缺失改善追蹤。
五、會計處理制度：應包括會計帳務與分錄處理程序、損益認列及財務報告之揭露。
六、風險管理制度：應包括交易風險之辨識、衡量、監控及報告，交易風險至少應包括信用、市場、流動性、作業、法律及系統風險等項目。
七、交易對手風險：從事店頭市場交易時，應對交易對手進行信用風險評估，並依個別交易對手之信用狀況，訂定交易額度限制，並隨時控管之。
八、第二項所列之定期向董（理）事會及風險管理委員會報告事項。
保險業至少應依下列規定，定期向董（理）事會及風險管理委員會報告：
一、報告項目：
（一）未到期交易之總額、淨額及依公平價值評估之未實現損益。
（二）遵守從事衍生性金融商品交易處理程序情形。
（三）衍生性金融商品交易之績效評估及風險評估報告。
（四）從事被避險項目為預期投資部位之避險衍生性金融商品交易，按預期投資組合與實際投資組合計算之避險有效性差異數達百分之二十以上者，應報告上開避險有效性差異之情形及理由。
二、報告頻率：
（一）從事避險目的及結構型商品投資之衍生性金融商品交易者，至少應每半年向董（理）事會及風險管理委員會報告。
（二）從事增加投資效益目的之衍生性金融商品交易者，至少應每月向風險管理委員會報告後，向董（理）事會或其授權之單位報告。
但符合下列條件者，至少應按季向董（理）事會及風險管理委員會報告：1.未到期交易屬依第八條規定辦理且保險業內部已建置資料庫儲存交易相關資訊之交易。
2.前１、任一交易存續期間內之已實現及未實現損失之合計金額，未逾新臺幣五千萬元與該保險業業主權益百分之零點一兩者間孰低者。
3.１、全部交易存續期間內之已實現及未實現損失之合計金額，未逾新臺幣一億元與該保險業業主權益百分之零點二兩者間孰低者。