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Asia-Pacific
Hong Kong Insurance Regulator Launches Groupwide Supervision Rule

Rules first proposed in December 2020 have been approved and put into place with the hope of luring large insurers to the region.
  • David Pilla
  • May 2021
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Night shot: An aerial view of Hong Kong’s financial center.
Night shot: An aerial view of Hong Kong’s financial center.

Hong Kong's insurance regulator has launched a groupwide insurance supervision framework while working on a regulatory regime for groupwide insurance-linked securities business in the wake of legislative amendments.

“The GWS framework is in full alignment with international standards and best practices, positioning Hong Kong as an ideal base for large insurance groups and a coordinator of supervisory efforts among all relevant jurisdictions in Asia-Pacific,” Clement Cheung, chief executive officer, Hong Kong Insurance Authority, said in a statement. “This is a central element of our strategic campaign to reinforce the status of Hong Kong as a global risk management center and a regional insurance hub.”

Clement Cheung Hong Kong Insurance Authority

This is a central element of our strategic campaign to reinforce the status of Hong Kong as a global risk management center and a regional insurance hub.

Clement Cheung
Hong Kong Insurance Authority

The Insurance Authority said it engaged closely with industry stakeholders to develop a guideline on group supervision with principles and standards for designated insurance holding companies in areas including enterprise risk management, corporate governance, capital requirements and public disclosure.

The launch of the guideline will help the regulator effect formal designations for three insurance groups—AIA Group, FWD Group and Prudential plc—by mid-2021.

In late December 2020, the HKIA closed a public consultation on insurance group capital rules that the agency said at the time it planned to roll out in 2021 to complement a new supervisory framework for multinational insurance groups.

The proposed Group Capital Rules were forwarded to the Hong Kong Legislative Council at that time.

For the regulation of ILS business, the Insurance Authority said it is “ironing out implementation details by drawing reference from overseas experience while taking into account local circumstances.”

The regulator said its pilot ILS grant scheme, recently announced by the financial secretary, will help attract potential sponsors. The first issuance is expected this year.

The Insurance Authority said legislative amendments seek to expand the scope of insurable risks for captives, transforming Hong Kong into a preferred domicile for captives formed by state-owned enterprises from mainland China, multinational conglomerates and local corporates.

“Coupled with the tax concessions for the general reinsurance business of direct insurers, selected general insurance business of direct insurers and selected insurance brokerage business, these initiatives will inject impetus into the development of marine and specialty risks insurance in Hong Kong,” the regulator said.

Best’s Rankings
Largest 25 Asia-Pacific Insurers 2019 Ranked by Gross Premiums Written

(US$ thousands)

Rank AMB # Company Country of Domicile Gross Premiums Written Capital & Surplus
1 086446 Ping An Ins (Group) Co of China Ltd. China 113,805,461 96,356,266
2 052446 China Life Insurance (Group) Company China 99,869,780 19,336,926
3 085320 People’s Ins Co (Group) of China Ltd. China 79,478,628 26,259,319
4 090826 Nippon Life Insurance Company Japan 53,049,111 55,567,372
5 085485 Life Insurance Corporation of India India 50,534,695 98,505
6 090598 China Pacific Insurance (Group) Co Ltd. China 49,743,583 25,540,041
7 046417 Dai-ichi Life Holdings, Inc. Japan 45,314,104 35,032,425
8 050962 Tokio Marine Holdings, Inc. Japan 37,046,430 31,301,646
9 052662 MS&AD Insurance Group Holdings, Inc. Japan 34,798,852 31,756,502
10 052599 AIA Group Limited Hong Kong 34,777,000 57,508,000
11 053008 Japan Post Holdings Co. Ltd. Japan 29,955,071 101,418,643
12 052641 SOMPO Holdings, Inc. Japan 29,017,968 14,817,925
13 055742 China Taiping Insurance Group Ltd. China 28,013,945 5,307,644
14 090828 Meiji Yasuda Life Insurance Company Japan 27,008,351 32,841,056
15 093027 Huaxia Life Insurance Co Ltd. China 26,165,335 3,190,174
16 091242 Sumitomo Life Insurance Company Japan 22,694,529 14,526,464
17 077638 Taikang Insurance Group Inc. China 21,278,190 11,622,682
18 090958 China Reinsurance (Group) Corporation China 20,751,399 12,472,689
19 090300 Cathay Life Insurance Co, Ltd. Taiwan 20,328,506 19,589,233
20 093804 Fubon Life Insurance Company Ltd. Taiwan 20,182,087 11,232,546
21 058645 Prudential Holdings of Japan, Inc. Japan 19,808,090 5,899,405
22 091605 New China Life Insurance Company Ltd. China 19,772,071 12,088,316
23 093102 Samsung Fire & Marine Insurance Co Ltd. South Korea 16,851,412 12,385,532
24 052951 T&D Holdings Ltd. Japan 16,128,325 10,358,924
25 084748 MetLife Insurance K.K. Japan 15,276,064 5,069,303

Source:


David Pilla is news editor. He can be reached at david.pilla@ambest.com.



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