Hong Kong to set up insurance protection fund
The bill is planned to be introduced into LegCo in the 2012-13 legislative session for setting up the fund in 2013-14.
A Policyholders' Protection Fund is proposed to be set up in 2013-14 to provide a safety net for policyholders when an insurer becomes insolvent, the Financial Services & the Treasury Bureau has announced, after reviewing conclusions of a public consultation exercise.
Secretary for Financial Services & the Treasury Prof KC Chan said such a fund would enhance the insurance industry's stability and competitiveness.
The Government aims to introduce the bill into LegCo in the 2012-13 legislative session for setting up the fund in 2013-14 at the earliest, he added.
It would comprise life and non-life schemes, and focus on individual policyholders while also covering building owners' corporations.
It would cover small and medium enterprises, recognising that they have less resources to assess insurers' financial ability.
All authorised direct life and non-life insurers will be required to participate in the fund. The compensation limit would likely be $1 million.
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Tags: Hong Kong insurance, insurance fund, insurance fund bill
