FSC is to update insurers’ rules to ease FX hedgingA REVAMP: Under current rules, short-term exchange-rate movements generate major volatility in reported earnings, even if they are unrealized, the FSC saidBloombergTaiwan is set to overhaul accounting rules to help life insurers ease the impact of foreign-exchange fluctuations on their financial statements, a move that is likely to save billions of dollars in currency hedging costs. Taiwanese insurers last month proposed changes to accounting rules that would allow exchange-rate fluctuations to be partially recognized over time, rather than having their full impact reflected immediately. The plan was estimated to save US$2.9 billion in annual hedging costs and reduce their reliance on offshore NT dollar forwards as a hedging tool. Insurers began reducing their currency hedging positions in the second half of the year. That underscores the high cost of hedging relative to its limited effectiveness, the FSC said.

Source: Taipei Times December 24, 2025 16:55 UTC