Diverging Fortunes: Overflow Insurance Soars 150% to NT$48.8 Billion in First Half, While Physical Benefit Policies Plummet

The Financial Supervisory Commission (FSC) released its latest statistics today (6th), revealing that new contract premium income for overflow insurance reached NT$48.8 billion in the first half of 2026, a staggering 152% year-on-year increase. In contrast, physical benefit-type policies recorded only about NT$229 million in premium income, a sharp 56% decline compared to the previous year. According to Liu Chun-bin, Director-General of the Insurance Bureau, the divergent performance between these two product types is primarily linked to differences in product design, consumer spending habits, and insurers’ decisions to discontinue certain products.

FSC data shows that in the first half of 2026, overflow insurance sold 745,900 new policies—a 29% year-on-year increase—with initial annual premiums totaling approximately NT$48.8 billion. The top three life insurers by sales volume were Cathay Life, Nan Shan Life, and Fubon Life, in that order.

Liu explained that the significant growth in overflow insurance premiums stems largely from several popular high-premium products, including some single contracts with initial annual premiums exceeding NT$1 million. Additionally, many of these products were launched sequentially after June of last year, resulting in a low base effect that amplified year-on-year growth this period.

In terms of feedback mechanisms, policies offering “premium reductions or increased coverage based on exercise habits” were the most popular, generating NT$13.797 billion in premiums during the first half—an 82% year-on-year increase. Liu analyzed that this reflects consumers’ autonomous choices, as regular exercise is a form of health management that policyholders can control themselves. In contrast, policies providing “other non-cash benefits (e.g., designated health check services)” saw premiums decrease by nearly NT$300 million year-on-year. The main reason, Liu noted, is that many policyholders who opt for “premium reductions based on health metrics” already pay out-of-pocket for health checks, reducing their willingness to choose duplicate non-cash services.

Compared to the robust growth of overflow insurance, physical benefit-type policies have performed weakly. In the first half, they recorded 228,500 new policies—a 5% year-on-year decrease—and premium income of just NT$229.48 million, down 56% year-on-year. The top three sellers were Cathay Life, Fubon Life, and Nan Shan Life.

Regarding the significant decline in physical benefit policies, Liu attributed it mainly to the “discontinuation of key best-selling products.” The most affected were medical service-type policies, despite minor fluctuations in the number of available products on the market. Specifically, one life insurer discontinued two previously high-performing medical-type products. Liu further pointed out that although these products had relatively strong sales within their category, overall market scale failed to meet company expectations, prompting a strategic decision to discontinue them.

Moreover, Liu acknowledged that “health management service-type” physical benefit policies have long faced stagnation, with market demand and capacity unable to expand effectively.

On the challenges facing physical benefit policies, Liu added that while the original vision was to deeply integrate long-term care services (e.g., admission to designated LTC facilities or related care), strict licensing regulations and policy constraints in the LTC sector make seamless integration with insurance products difficult. Additionally, many policyholders prefer receiving cash benefits and then sourcing appropriate services independently, as the limited options provided by insurers do not always align with individual needs.