Hong Kong Issues 2013 Insurance Sector Report
by Mary Swire, Lowtax.net, Hong Kong
01 September, 2014
Hong Kong's Commissioner of Insurance Annie Choi has released her office's Annual Report 2013, pointing out that she welcomed the further progress made in institutional reform and consumer protection during the past year.
She noted that significant developments have been made in a number of areas concerning insurance supervision, particularly the legislative progress for setting up the independent Insurance Authority. "We completed a public consultation exercise on the key legislative proposals in June, and the Insurance Companies (Amendment) Bill 2014 was introduced into the Legislative Council in May 2014."
On the other hand, with regard to the proposed Policyholders' Protection Fund, her office has continued to prepare the enabling legislation.
On Hong Kong's participation in the Financial Sector Assessment Program Update in 2014, Choi said that "assessors from the International Monetary Fund considered that Hong Kong has had a high degree of observance of the Insurance Core Principles, and expressed full support for our current regulatory reforms."
She also referred to the Financial Secretary's proposal to reduce the profits tax on the offshore businesses of captive insurance companies in the 2013-14 Budget, which took effect in April. She confirmed that the initiative will strengthen Hong Kong's position as a risk-management center.
"In respect of the sale of investment-linked assurance scheme products, following the introduction of new regulatory requirements for the selling process in mid-2013," she added, "we issued a Guidance Note setting out proper standards of conduct and business practices for insurers in 2014, aiming at better protection of policyholders."
Choi also disclosed that "we will continue our collaborative efforts with other local and overseas financial regulators, particularly in regard to anti-money laundering work, and supervision of insurance groups and intermediaries." She believes that, with the dedication of all stakeholders, Hong Kong will become a premier insurance hub in the region.
2013 was said to be another encouraging year for the insurance industry. The sector saw strong growth of over 13 percent, comprising some 15 percent growth in the life sector and 7 percent growth in the non-life sector. The growth engine for the life side came from traditional protection and endowment products, while for the non-life side, general liability business and accident and health policies led the growth.
As at December 31, 2013, there were 155 authorized insurers, 71,212 appointed insurance agents, and 9,830 authorized brokers operating in Hong Kong.
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