Hong Kong’s Insurance Authority has launched a review of medical insurance products, concentrating on issues of coverage adequacy, affordability, and consumer protection, according to Clement Lau, Executive Director for Policy and Legislation.
Speaking at the 21st Asia Conference on Healthcare and Health Insurance on 26 March, Lau stated that the review will be supported by strengthened data analysis capabilities. This is intended to give the regulator a more precise and comprehensive understanding of prevailing market conditions and product performance across the sector.
A key element of the exercise is the enhancement of the quality, consistency, and level of detail in industry data collected from insurers. This improvement is expected to enable more accurate assessment of how medical insurance products are structured, how premiums are determined, the extent of coverage provided to policyholders, and the broader influence of escalating medical costs on insurance design and sustainability.
Lau explained that the initial phase of the review will focus on products affecting the largest proportion of policyholders. The overarching aim is to refine product offerings so that they remain both accessible and affordable, while also ensuring the long-term sustainability of the market. He added that consumer protection will remain central to the initiative, alongside continued efforts to reinforce conduct regulation within the insurance industry.
As part of the review, the authority will also examine Guideline 31, which sets out requirements relating to accessibility, affordability, and fair treatment of customers. The regulator indicated that it may issue more detailed guidance to insurers following this review. Such guidance would take into account feedback from policyholders as well as practices observed in other insurance markets, with the objective of promoting fairer standards in sales processes, claims handling procedures, and complaint resolution mechanisms.
Main focus areas under review
| Focus area | Scope of review |
|---|---|
| Product coverage | Evaluation of adequacy, structure, and scope of medical insurance products |
| Affordability | Examination of premium levels and cost pressures affecting policyholders |
| Industry data | Improvement in consistency, quality, and analytical usefulness of reporting |
| Consumer protection | Strengthening safeguards in sales conduct, claims handling, and complaint management |
| Regulatory standards | Possible refinement and expansion of Guideline 31 requirements |
In a separate speech delivered on 25 March, Lau noted that Hong Kong’s seven captive insurers are operating in a sound and stable manner. Captive insurers are entities established by corporations to underwrite their own risks, allowing groups to retain underwriting profits and investment returns internally while managing specialised or complex risk exposures.
Lau also referred to global developments in the captive insurance sector, observing that worldwide premiums in this segment have exceeded US$220 billion. He further noted that China accounts for around 18 per cent of global gross domestic product.
According to Lau, both the Hong Kong government and the Insurance Authority are preparing additional measures aimed at supporting the continued development and strengthening of the captive insurance sector, as part of broader efforts to enhance the city’s insurance market framework.