On 21 Nov 2025, the HKMA issued the revised IB-1 Supervisory Policy Manual (V.2) to clarify its supervisory framework for authorized institutions acting as insurance intermediaries, superseding the 2021 version. The guidance mandates strict adherence to licensing requirements, enhanced corporate governance with defined responsible officer authority, compliance with IA's Codes of Conduct and product sale guidelines, and timely reporting of incidents, while reinforcing the HKMA's role in day-to-day supervision and disciplinary recommendations under the Insurance Ordinance.
This article was generated using SAMS, an AI technology by Timothy Loh LLP.
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Introduction
On 21 Nov 2025, the Hong Kong Monetary Authority (HKMA) published the revised Supervisory Policy Manual module IB-1, 'Supervision of Insurance Intermediary Business of Authorized Institutions' (V.2), superseding the previous version dated 25 June 2021. This guidance clarifies the HKMA's supervisory approach for authorized institutions (Als) licensed as insurance intermediaries under the Insurance Ordinance.
Regulatory Framework and Supervisory Role
The revised guidance reaffirms the HKMA's supervisory mandate under the Banking Ordinance for Als carrying on regulated insurance intermediary activities, following the Insurance Authority's (IA) delegation of inspection and investigation powers under Sections 64ZZF(6) and 64ZZH(1) of the Insurance Ordinance. The HKMA conducts day-to-day supervision, including on-site examinations and off-site surveillance, while maintaining close coordination with the IA through a Memorandum of Understanding (MoU) signed in 2019 and 2021. The HKMA will inform the IA of findings and recommend disciplinary actions under Section 81 of the Insurance Ordinance where misconduct is identified.
Key Regulatory Requirements for Als
The guidance details critical requirements for Als, including mandatory licensing with the IA under Section 64G of the Insurance Ordinance, with the HKMA requiring an Independent Assurance Report for new or complex insurance business lines. It mandates Als to appoint sufficient responsible officers with adequate authority (e.g., chief executives or senior managers as responsible officers, with no more than one rank below senior management), as specified in updated expectations under GL23. Als must also comply with the IA's Codes of Conduct, GL24 (Continuing Professional Development), and IA guidelines on product sales (e.g., GL16, GL27, GL30), while implementing robust corporate governance, internal controls, and anti-money laundering measures.
Reporting and Disciplinary Obligations
Als must adhere to statutory reporting requirements under the Insurance Ordinance, including notifying the IA of changes in licensed technical representatives, responsible officers, or business cessation within specified timeframes (e.g., 14 days for personnel changes). The guidance mandates immediate reporting of incidents involving non-compliance with insurance regulations, misconduct, or fitness and propriety issues to both the IA and HKMA. Disciplinary actions under Section 81 of the Insurance Ordinance, including licence revocation or pecuniary penalties, may be initiated by the IA following HKMA's investigation and recommendation, with the IA required to consult the HKMA before acting on Als or their personnel.
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