February 2014 Issue No. 209
Independence of Insurance Authority (IIA)
Over the past months, we have been in close dialogue with the Financial Services and the Treasury Bureau (FSTB) and raised concerns on a raft of issues of great significance to our industry, including CEO as Responsible Officer, representation on the IIA Board, Industry Advisory Committees, pecuniary penalties and appellate mechanism. On 12 February 2014, we wrote to the FSTB again on the subject of insurance agents acting in the best interests of policyholders. We recapped the industry's stance and our rationales behind and are now awaiting Government's reply.
On 13 February 2014, the Working Group on IIA convened by the FSTB held its second meeting on the transitional arrangement. With the planned establishment of the IIA in less than two years, we want to see the early resolution of all outstanding items to ensure a seamless migration to the new regulatory framework.
Health Care Reform
The Task Force on Health Care Reform met again in early February to tackle the outstanding issues. They include the lack of consumer choice, sustainability of the High Risk Pool and portability of proposed Health Protection Scheme (HPS), etc.
At the Legislative Council's Subcommittee on HPS held on 18 February 2014, Council members appeared to share our doubts and concerns over the viability and practicality of the proposed HPS. The issue of claim dispute resolution mechanism was also brought up at the meeting. Through the Honourable K P Chan, we reiterated the merits of adopting the Insurance Claims Complaints Bureau model for consumers, which offers cost-effective services free-of-charge. The present adjudication process with professional and independent input from the honorary secretaries has proved efficient and credible.
Developing RMB Reinsurance Business in Hong Kong
At the suggestion of the insurance industry, the New Business Committee under the Financial Services Development Council (FSDC) is now exploring the feasibility of establishing Hong Kong as an off-shore RMB reinsurance centre. This will be a new area of potential growth and help reinvigorate the Hong Kong reinsurance market. To take this forward, a core group convened by Mr Philip Nye, Convenor of the Reinsurers' Forum, has been set up with experts from both life and general insurers/reinsurers.
At our recent luncheon with FSDC Chairman Mrs Laura Cha and Under Secretary of the FSTB Mr James Lau, we have also expressed our firm support of this initiative. We will work in close collaboration with the FSDC to explore practical steps to move this forward.
Privacy Management Programme (PMP)
I am pleased to report that 25 insurance companies representing 27 HKFI Member Companies signed the pledge in support of the PMP at a ceremony conducted
by the Privacy Commissioner on 18 February 2014. This marks an important milestone in our industry’s support for data privacy and we would encourage more members to pitch in in the future. For an updated
list of HKFI Members Companies supporting the PMP, please visit this link: http://www.hkfi.org.hk/#!/event/287.
Population Policy
In our submission to Government, we made some general observations about the essence of population policy and raised some questions for the Administration to ponder. Furthermore, we provided specific comments from the insurance perspective on talent development, how to facilitate early return to work for injured workers and how best to meet the needs of the silver-hair market. For details of our position paper, please refer to http://www.hkfi.org.hk/#!/event/289.
Marine Insurance
Mr Lars Lange, Secretary General of International Union of Marine Insurance (IUMI), visited Hong Kong this month and met with HKFI's Organising Committee on the preparation of the Conference to be held in September this year. He also took the chance to meet with Mr Eddie Cheung, Deputy Secretary for FSTB, and exchanged views on various issues such as marine insurance market development in Asia and
Coincidentally, Mr Timothy Lee, Committee Delegate of the Marine Insurance Association, made a presentation on “Risk Assessment for Ships – Insurance Perspective” at the China Maritime 2014 exhibition, which was well attended by ship charterers, cargo ship owners, ship brokers, etc.
Proposed OSH Star Enterprise Pilot Scheme for the Recycling Industry
To step up concerted efforts in reducing waste at source and to help develop the local recycling industry, the Environmental Protection Department, in collaboration with the Occupational Safety and Health Council and Labour Department, proposed to launch the above Scheme. It encourages adoption of practicable safety measures to improve work environment and reduce the number of occupational accidents. It will also provide useful information for insurers when deciding employees’ compensation insurance premium rate for individual operators. A briefing on the Pilot Scheme was conducted for our Members on 25 February 2014.
Visit of Students from Paris-Dauphine University
We received a delegation from Paris-Dauphine University's Insurance and Risk Management Program on 11 February 2014. Mr Allan Yu, GIC Councillor, briefed them on the recent regulatory changes of insurance industry in Hong Kong such as the proposed IIA, PPF, etc. He also gave the post-graduate students some current information about the insurance market in Hong Kong.
Teenagers’ Poll on Ten Top Financial News in the Year of Snake
The Junior Financial Secretaries carried out a poll on the Top Ten Financial News in the Year of Snake among secondary schools students in Hong Kong. A total of 4,084 responses were received and the results were announced on 29 January 2014. The top
Europe, talent development and how Hong Kong should position itself as an international maritime and insurance centre. three news receiving the highest votes were:
1. Fake HK$1,000 banknotes found in Hong Kong and Macau (54.51%); 2. Ricky Wong announced HKTV to launch (47.03%); 3. Two new free-to-air television licenses approved (45.18%). Details are available at: http://www. hkfi.org.hk/#!/event/278.
Thomas Lee HKFI ChairmanChange of Authorized Representatives
Allied
Cigna
Cigna
HKFI Membership
As at 28 February 2014, the HKFI has 86 General Insurance Members and 43 Life Insurance Members.