Circular issued by the Insurance Authority (“IA”) on action against (and correction of) non-compliant business models that incentivize unlicensed selling of long term insurance policies to Mainland China Visitors

On 12 Jun 2024 Alan Au, Executive Director (Banking Conduct) wrote to draw attention to the circular “Action against (and correction of) non-compliant business models that incentivize unlicensed selling of long term insurance policies to Mainland China Visitors” issued by the IA on 22 May 2024 (“IA Circular”). The IA Circular reinforces the licensing requirements and the insurance regulatory framework for the Hong Kong life insurance market, with a particular focus on business models engaged by licensed insurance intermediaries to rely on or have arrangements with unlicensed persons who source and refer clients to the licensed insurance intermediaries (“unlicensed referrers”). Further guidance is set out in the Annex to the IA Circular, including the limits that unlicensed referrers must stay within and the obligations on licensed insurance intermediaries when engaging unlicensed referrers. Resources: https://www.hkma.gov.hk/eng/regulatory-resources/regulatory-guides/circulars/