Thursday, October 11, 2018

Governance, Risk and Compliance-The Hong Kong Insurance Industry: Ken Research

Due to disruption in the market, technology and innovation coupled with consumer expectation, the insurance industry in Honk Kong is dynamic and ever changing. More focus is given to sales, bottom – line profitability and competing with new entrants. Major insurers in Honk Kong are facing a sharp increase in their gross premiums. This was mainly attributed to higher sales in bancassurance and broker channels.  Of recently, Honk Kong’s Insurance Authority launched flagship programs called the Sandbox and Fast Track which opened gates for many insurers to lesser regulations in their operations and paved way for collaborations with insurtechs in an encouraging manner. These initiatives will help Honk Kong keep pace with China’s speed of innovation in insurance. Sandbox gives an encouraging environment for insurers to innovate their services without having to be subject to full compliance with Insurance Authority.

Honk Kong has one of the world’s longest life expectancies and this can pave way for innovations in the field of life insurance. Since the people of Honk Kong are highly tech – savvy, it puts the insurers in a position to provide advanced – stage insurance products to keep up with their expectations. This year is expected to be high - lighted with innovation in insurance, whereas speed and adaptability are the key elements to succeed in the market. Though insurtech is new in the market, the insurers and the people are showing high levels of acceptance. Among the insurers who already have adapted to digitalisation and innovation in their services, it was observed that data analytics have been used to study monitor and provide personalised solutions to the clients. Customer centric approach is a priority to many insurers.  Chatbots with AI have been employed by various insurers; rigorous training and development has also been given to the employees to help them innovate with customer and user centric approaches as their motto.

Ken Research’s Governance, Risk and Compliance-The Hong Kong Insurance Industry provides an overview of the insurance regulatory framework in Honk Kong. It gives the latest key changes, and changes expected in the country's insurance regulatory framework. The report provides key regulations and market practices related to different types of insurance product in the country and rules and regulations pertaining to key classes of compulsory insurance, and the scope of non-admitted insurance in Honk Kong. The key parameters including licensing requirements, permitted foreign direct investment, minimum capital requirements, solvency and reserve requirements, and investment regulations and details of the tax and legal systems in the country are detailed in the report.

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