| Summary: | 碩士 === 淡江大學 === 保險學系保險經營碩士在職專班 === 106 === In Taiwan, life insurance companies are adopting the asset allocation method of foreign investment highly proportion in order to dispose massive premium income. However, with the high standards of such foreign investment allocation, how to control risks while giving consideration to future solvency has become a challenge to life insurance companies and the authorities. With the consistent high ratio of foreign investment in the business in Taiwan, life insurance companies should have risk control mechanisms that are stricter, such as building foreign exchange valuation reserve mechanisms, allowing them to manage exchange rate risks more flexibly and reducing hedge costs, to further strengthen their solvency for perfecting their financial constitution. The purpose of this study is to examine the determinants of foreign investment for life insurance companies. By using 206 samples from 2009 to 2016, this study investigates the determinants relating to the amount of foreign investment to applicable capital ratio. The empirical results support the size and the financial affiliated group membership have the positive and significant impact on the amount of foreign investment. But the premium to total asset ratio has the negative and significant impact on the amount of foreign investment. Furthermore, by using 95 samples from 2013 to 2016, this study investigates the determinants relating to the foreign exchange valuation reserve amount of foreign investment ratio. The empirical results support the foreign life insurance companies intend to have more foreign exchange valuation reserve. However, the life insurance companies with more amount of foreign investment to applicable capital ratio intend to have less foreign exchange valuation reserve.
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