A bill to transfer risk to capital markets was introduced in March.
Hong Kong is set to join the UK and Singapore as hubs for insurance-linked securities, reports Reuters.
In March, the government introduced the Insurance (Amendment) Bill 2020, which grants a regulatory framework for insurers to transfer risk to the capital markets by issuing insurance-linked securities through special purpose insurers (SPIs).
A second reading will probably take place no earlier than October after the Legislative Council election, the report said.
The bill allows a new class of insurance business called special purpose business (SPB) to be conducted by special purpose insurers, whose insurance contracts are fully funded through insurance securitisation.
If passed, the bill would be a first step to fulfilling the aim of reinvigorating the city’s insurance industry and clinching a share of the ILS market to support Chinese investments in global infrastructure projects.
Here’s more from Reuters.
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