TAIPEI Nov 28 Taiwan's government will pay
Transglobe Life Insurance T$88.4 billion ($3 billion) to take
over ailing rival Kuo Hua Life after Transglobe beat out other
competitors in the biggest taxpayer-funded bailout ever by the
Taiwan's overcrowded life insurance industry has been hit by
cut-throat competition, in part because Taiwan's interest rates
are among the lowest in Asia, prompting much consolidation in
the sector, particularly as foreign firms exit the market.
Local media said Chinatrust Financial Holdings Co Ltd
and Mercuries Life competed in the auction with
Transglobe, which is a mid-sized insurer previously owned by
Dutch insurer Aegon.
Kuo Hua Life, a small insurer which has been in financial
difficulty for years, has 1.4 million policy holders compared to
Taiwan's population of 23 million, the Financial Supervision
Commission said in a statement late on Tuesday.
Foreign firms that have left the market in the past few
years include AIG, which sold its Taiwan life insurance
business for $2.2 billion to a local conglomerate, and ING Groep
NV which sold its Taiwan insurance assets to Fubon
Financial Holding Co Ltd.
British insurer Aviva has also said it will sell its
stake in a joint venture with First Financial Holding Co