Gov't contradicts Nan Shan Life claims
By Ted Chen,The China PostTAIPEI, Taiwan -- In response to Nan Shan Life's (南山人壽) recent announcement that it will end its telemarketing operations, the Financial Supervisory Commission (FSC, 金管會) yesterday said that the decision had little to do with the enactment of the Personal Information Protection Act (PIA, 個資法).
February 28, 2013, 12:01 am TWN
Telemarketing accounts for a negligible amount of revenues in Nan Shan Life's overall operations, as the company mainly relies on its network of insurance retail agents, and collaborations with banks, said the FSC.
The FSC also referred to Nan Shan's decision as a shift in operational strategy after a period of internal deliberation.
Nan Shan Life had indicated its telemarketing operations would cease on Feb. 26, adding that the 70 staff members of its telemarketing operation will be reassigned to other positions within the company.
Many other insurance carriers and businesses that utilize telemarketing are expected to follow, according to insurers, which added that all five of the top-ranking insurance carriers utilize telemarketing.
Citing the high cost of compliance with the new regulatory standards, the company said that the stipulations of the PIA have rendered telemarketing unfeasible, said sources close to the industry.
According to the terms of the PIA, telemarketers may not call consumers after they have expressed their refusal to receive solicitations over the phone, which greatly hampers the efficacy of telemarketing.
In addition, the PIA requires telemarketers to gain the consent of consumers before any dialogue or solicitation may be recorded, which greatly hampers the efficacy of telemarketing for companies that are not affiliated with a financial holding company, which has access to pools of consumers that have already expressed consent for voice recordings.
Moreover, since the introduction of the PIA, the trade in lists of personal information intended for soliciting for prospective clients is now subject to stringent regulation, resulting in reduced availability and increased costs.
Since the introduction of the PIA, two insurance operators have been penalized for violations related to telemarketing. In January, PCA Life Insurance (保誠人壽) was fined for unauthorized telemarketing, and was ordered to cease its telemarketing operations for one month by the FSC. In February, Shin Kong Life (新光人壽) was fined by the FSC for unauthorized recording of client solicitation over the phone.
Currently, the total revenue contribution from telemarketing for Taiwan's insurance industry is estimated at NT$6.8 billion, representing 0.6 percent of total revenues.