June 2019
Issue No.268
Change of HKFI’s Articles of Association (AoA)
Commencement of IA’s Direct Licensing Regime
At its meeting held on 25 June, the Governing
I n the run-up to 23 September 2019, we are working
Committee endorsed the proposed amendments on the HKFI’s Articles of Association (AoA) to:
(a) remove the powers and functions of the Insurance Agents Registration Board (IARB), Appeals Tribunal and any self-regulatory functions from 23 September 2019 onwards; (b) align the AoA with the new Companies Ordinance (Cap. 622) which came into effect on 3 March 2014; (c) allow more flexibility for HKFI to perform new roles and functions, including forming partnership with external parties, setting up subsidiaries and conducting profit gaining businesses. This is an important and necessary step for HKFI to reposition itself in preparation for the post-SRO era. The revised draft AoA is being circulated to Members for review. On this we look forward to your feedback and support (Circular Ref: Mv064/19).
closely with the Insurance Authority (IA) on a raft of industry consultations concerning four draft guidelines on life insurance. The turnaround time is short but we hope Life Insurance Members (LIMs) can respond and provide comments and feedback by the deadline this week (Circular Ref: Mv060/19, Mv062/19).
We are making good progress on all aspects of the transition. So far, we have conducted six rounds of productive working meeting with the IA and we are getting fairly close to completing all major items of the work required. Our next focus is on the handing over of outstanding complaint and appeal cases from the IARB to the new regime. Meanwhile, IA is c onduc ting a mar ket sur vey of insurance agencies registered with the IARB. Please remind your appointed agencies, if any, to respond to the survey on time.
Medical Insurance
We conducted a Members’ consultation on IA’s Draft Guideline on Medical Insurance Business (GL on
MIB) in January 2019. And we are pleased to note that many of our suggestions have been accepted and incorporated in the latest draft produced by IA. We are now seeking Members’ further comments on this revised version (Circular Ref: Mv061/19).
Following the official launch of the Voluntary Health Insurance Scheme (VHIS), we have been meeting the relevant Food and Health Bureau (FHB) officials regularly to review progress and identify areas for improvement. Apart from beefing up data reporting, we have agreed on the need to standardize the underwriting questionnaires for VHIS products.This is also an area which the Medical Insurance Association (MedIA) has chosen to be a top priority work item this year. We are currently reviewing the related common underwriting questions in the medical insurance market. We hope to provide a set of standardized questions in layman terms so that policy applicants will find it easier to understand and respond. The dedicated team under the MedIA aims to come up with the first draft before Q4 2019 and will consult Members thereafter.
Development of Risk-Based Capital (RBC) Regime
Prior to the third Quantitative Impact Study (QIS 3), the IA is conducting a Pilot Test, namely QIS 2.5, using a representative
sample of life insurance companies. On this the Life Insurance Council (LIC) is collecting LIMs’ views and will prepare an industry submission supported by robust quantitative analysis.
On the other hand, the General Insurance Council (GIC) is working closely with the IA on six working groups projects covering Catastrophe Risk – Systemic Man-made (Liability) / Catastrophe Risk - Non-systemic Man-made (Property & Engineering) / Credit Insurers / Reinsurers / SME GI insurers / Branches of insurers incorporated overseas. This is to facilitate more in-depth analysis of and focused discussion on these technical subjects with input from experts in the related fields within and outside the industry.