On 12 Jun 2024, the HKMA circulated the IA’s circular reinforcing licensing requirements for Hong Kong life insurers, targeting unlicensed business models that incentivize selling long-term insurance to Mainland visitors via unlicensed referrers. The circular mandates licensed intermediaries to enforce strict limits on unlicensed referrers and requires all AIs to implement compliance controls, with non-intermediary AIs prohibited from engaging in regulated insurance activities.
This article was generated using SAMS, an AI technology by Timothy Loh LLP.
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Regulatory Reinforcement
On 12 Jun 2024, the Hong Kong Monetary Authority (HKMA) circulated the Insurance Authority’s (IA) circular dated 22 May 2024, which reinforces existing licensing requirements and regulatory framework governing Hong Kong’s life insurance market, specifically targeting business models that incentivize unlicensed selling of long-term insurance policies to Mainland China visitors through unlicensed referrers.
Compliance Obligations
The circular mandates licensed insurance intermediaries to ensure unlicensed referrers operate within defined limits and imposes clear obligations on intermediaries engaging such referrers, including implementing adequate policies, procedures, and staff training. Authorized Institutions (AIs) not licensed as insurance intermediaries are explicitly reminded to refrain from conducting any regulated activities under the Insurance Ordinance and to maintain robust compliance controls.
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