The life insurance industry in Taiwan had a financial exposure to Israel that amounted to NT$169.4bn ($5.26bn) as of the end of August 2023, the Financial Supervisory Commission (FSC) has announced.
The investments were by life insurers and most of the exposure was in Israeli public bonds. No non-life insurers in Taiwan hold Israeli government bonds, the commission added.
The FSC made the announcement in the wake of Israel going to war against Hamas in retaliation for the militant group’s attacks on Israeli towns on 7 October.
Taiwan’s domestic financial sector’s exposure to Israel exceeded NT$172bn as of the end of August, with the insurance sector accounting for about 98% of the total, the FSC said.
Life insurance executives told Economic Daily News that major domestic life insurance companies have more or less invested in Israeli public bonds, mainly because of the country’s good credit rating and good investment returns. The yield on Israel’s 30-year public bonds is as high as 5.73%, and the country’s sovereignty rating is “AA-“, higher than for many countries. Moreover, credit rating companies have not downgraded Israel’s national debt credit.
The industry executives do not expect any loss from the investments. They say that the Israeli-Hamas war is completely different from the Russia-Ukraine war in respect of which sanctions had been imposed against Russia by several countries.
