I didn’t find anything about this type of insurance, and instead found a lot about how to make sure the business owner or employee can get health insurance via the company we set up.
My situation
I am negotiating with a Canadian company to license the products and import them into Taiwan. We import healthcare products from North America and Europe into Taiwan. This clause about insurance is from a draft of the licensing agreement that they provided:
One of my partners grew up in Canada and explained that this is not unusual there. I want to tell them that this is not normally required in Taiwan. Maybe their intention is to make sure our company (the licensee) is prepared to weather any legal challenges - eg., if a customer in Taiwan sues because they believe they were hurt by the product (so this would be covered by Product Liability Insurance); or if an employee gets hurt (covered by Employer Liability Insurance?)?
So, can I tell them that general corporate insurance is not a typical practice in Taiwan? It may be available from private insurance companies if you ask for it, but most companies do not have this type of coverage. Instead, labor insurance (Laobao) and health insurance (Jianbao?) are sufficient, and are provided or administered by government.
I do not know if that last paragraph is correct. I am hoping someone can set me straight so I can satisfy my prospective licensing partner in Canada. Maybe I can propose alternative language that is appropriate for Taiwan’s legal/business environment.
I guess they might also require some protection in case you screw up and they choose to sue you (read: they want your insurance company paying for their damages). Does any of your insurances cover that already?
I don’t make the connection between a CPA and General Liability insurance. Beyond NHI and labor insurance, what insurance do you have for your Taiwan startup?
That’s not relevant to our situation. We will buy their product, ship it over, pay the customs duties, and sell to our key accounts and distributors. If we screw up, we would contend with the users, distributors, and regulators. I can appreciate the value of insurance, I just don’t think it is common for our business.
None of the other licensing partners we have for our products from North America and Europe have even hinted at the need for this. Again, I’m not saying I’m against the idea - I just don’t believe it is a regular practice here. I’m hoping someone can point me to what they have done instead or direct me to where I should go to get something I’ve missed all this time
Does any of your insurances cover that already?
We don’t have any employees on payroll yet (we work with distributors and contract salesforces). When we do bring on board our own staff, we will have to set up labor and health insurance. There are Taiwan government coverage schemes for our medical devices, which would handle adverse events if they ever arose.
But I have not seen the need to secure product liability insurance of my own.
If you’re running a business in Taiwan, a CPA should be able to guide you through this kind of question. It’s probably better than what any of us can tell you. Official advice is the best advice.
Fair enough. I’ll ask my partner to query our accountant.
But I’m wondering if getting “general corporate liability” is common practice here. I’m no spring chicken and while I’ve made as many boneheaded mistakes as the next person, this one is new for me
