In order to enhance the effectiveness of internal audit function in financial institutions and give internal auditors execution flexibility, the Financial Supervisory Commission (FSC) adheres to the principle of differential supervision and continues to promote the adoption of risk-based internal audit system in financial institutions. Initially, domestic banks are allowed to apply for risk-based internal audit system since 2016, and there have been 21 domestic banks approved for the implementation by mid-October 2022. Now the insurance enterprises have been officially included. Some amended articles and an interpretation to the “Regulations Governing Implementation of Internal Control and Auditing System of Insurance Enterprises” are issued to encourage domestic insurance enterprises which are financially sound with an effective internal control system to apply for permission to adopt the risk-based internal audit system.
The risk-based internal audit system for insurance industry means that the domestic insurance enterprises could decide the audit frequency of internal audit according to their risk trend and internal risk assessment, so that they could focus on important risks and strengthen the audit depth, as well as to allocate internal audit resources more effectively.
The FSC said that adopting risk-based internal audit methodology helps the insurance industry not only to identify and evaluate their material risks but also improve their ability to exercise self-oversight. The FSC expects that the insurance industry will improve their internal control and internal audit mechanisms for sustainable growth to respond to the public's trust and expectation. 


Contact Unit: Insurance Companies and Foreign Banks Division, FEB
Contact Number: 02-8968-0649 
If you have any questions, please send an email to: https://fscmail.fsc.gov.tw