Independence of Insurance Authority (IIA)
The first meeting of the Working Group to Facilitate Smooth Transition to IIA, convened by Deputy Secretary for Financial Services and the Treasury with representatives from the Insurance Authority (IA) and the three self regulatory organisations (SROs), was held last week.
The Working Group is tasked to oversee the smooth migration from the present self-regulatory regime to the new IIA. We believe this should not be just about the transfer of data and documents. Of equal importance is the transfer of SROs' expertise to the new regulatory authority including the valuable experience and knowledge accumulated by the Insurance Agents Registration Board and Appeals Tribunal over the years.
Policyholders Protection Fund (PPF)
46 General Insurance Members (GIMs) and 32 Life Insurance Members (LIMs) responded to our survey on the impact the proposed PPF will have on their business operations. The results confirmed our serious concern over the length of the continuity of cover, the implication of 1% levy cap on life insurance business and the remaining off-shore to be covered by the PPF.
The Task Force on PPF has already relayed the gist of the survey results to the Financial Services and Treasury Bureau and IA. A meeting will be held with the Government early next month to further review the concerns raised by Members. At HKFI our position is clear - we support the proposed PPF in principle but it should be rolled out on a sound basis to avoid creating inadvertently any potential systematic risks for the industry.
Health Care Reform
Earlier this month, the Food and Health Bureau (FHB) and their consultant presented a revised version of the Health Protection Scheme (HPS). The revised proposal has taken into account some of the views of the industry. But we remain gravely concerned about the lack of choice for consumers, operation of the high risk pool, etc. Our concerns have been echoed by the patient groups, academia and medical profession as reported in the media lately.
To further articulate our industry's concerns, we will provide another written submission to the FHB. A briefing will be held in late November to update Members on the latest development.
New LIC Councillor
Following Mr Roger Steel's resignation, the LIC had conducted a by-election to fill the vacancy. Mr Wim Hekstra of Sun Life Hong Kong Limited was elected.
Congratulations to Mr Hekstra and a sincere vote of thanks to Mr Steel for his valuable contribution to the Federation in the past years.
Review of Benefit Illustrations for Investment-linked Life Assurance Schemes (ILAS)
The above consumer protection mechanism was introduced to provide useful information to customers at the point of sale and illustrate the effect of early surrender.
In the light of the recent economic circumstances, the LIC has, in collaboration with the IA and Securities and Futures Commission, reviewed the current rates used in the Illustrations and suggested some changes. Effective from 1 January 2014, the illustration rates will change from a maximum of 9% and 5% for two illustrations to a maximum of 9%, 6% and 3% for three illustrations to give the customer a clearer idea of the variability of the potential outcome.
Improved Sales Flow for ILAS
The LIC has updated, with input from the IA, the existing FAQ on ILAS to clarify the best practice of proposing an ILAS product by an intermediary. Member Companies are advised to amend, where appropriate, their respective post-sale call script and point-of-sale audio recording script accordingly and check regularly the HKFI website for updates. (http://www.hkfi.org.hk/pdf/en/download/e_FAQ.pdf)
Qualification Framework (QF) for Insurance Industry
This project was initiated by the HKFI more than two years ago with the support of the Education Bureau, IA and industry bodies. We are very pleased to see the completion of the first set of draft Specification of Competency Standards (SCS) for our industry. At the Consultation Ceremony cum Cocktail Reception for Insurance Industry held on 28 October 2013, I shared with around 200 insurance practitioners the challenges and opportunities our industry is facing and what the QF can help uplift our professionalism. Joining me that afternoon we had Mr Allan Yu and
Mr Alex Chu providing more background information about this QF exercise and introducing the structure and application of the draft SCS.
A three-month consultation on the draft SCS has commenced. You are strongly encouraged to provide comments and views to the QF secretariat on or before 31 January 2014 (www.hkqf.gov.hk/guie/SCS_Consult_ Insurance.asp).
Training Session for Orthopaedic Surgeons
Since its launch in 2011, the MORE Programme has helped more than 100 injured workers shorten substantially their work disability period. The success of the Programme highlighted the importance and benefits of public and private partnership in addressing problems of this nature.
In this connection, the Hospital Authority organised a training session on “Workers' Compensation Made Easy for Orthopaedic Surgeons” on 18
October 2013. Among others, Mr Harry Wong spoke to over 100 participants on the problems of Employees' Compensation insurance and how they should be tackled.
Promoting Hong Kong as an International Maritime Centre
Professor Anthony Cheung, Secretary for Transport and Housing and Chairman of the Maritime Industry Council, led a delegation to Taipei to promote Hong Kong as an international maritime centre. On behalf of the HKFI, Mr Allan Yu spoke on the strength of Hong Kong in providing marine insurance and related services in this region.
Visit of International Insurance Society (IIS)
Mr Mike Morrissey, President and CEO of the IIS, visited HKFI on 21 October 2013. We updated him on the work of HKFI and the latest developments of the industry. Furthermore, we discussed the possibility of IIS and HKFI working together to organise conference and conduct research work for the benefit of our insurance community in Hong Kong.
Asian Financial Forum
The captioned annual event will be held on 13 and 14 January 2014. The HKFI, for the first time, will sponsor a session at the conference in conjunction with the FSTB. We will focus on the topic of building Hong Kong as a captive insurance centre. More than 2,500 internationally respected leaders in government, financial and business sectors are expected to join this high level event.
Green Power Hike HKFI Cup 2014
The HKFI is supporting the Green Power Hike for the eleventh consecutive year. A total of 183 teams from the insurance industry have participated in this annual
charitable walkathon since 2004. The next Green Power Hike will be held on Saturday, 25 January 2014. We are appealing to you, your colleagues and agencies to continue supporting this meaningful cause. For further details, please contact Ms Queenie Shum of Green Power at 3961 0230.
MEMBERSHIP NEWS
Change of Authorized Representative
Euler Hermes Deutschland Aktiengesellschaft - Mr Fabrice Desnos
HKFI Membership
Thomas Lee HKFI ChairmanAs at 1 November 2013, the HKFI has 86 General Insurance Members and 42 Life Insurance Members.