At the 2024 Insurance Summit held on Nov. 7, Financial Secretary Paul Chan highlighted Hong Kong’s key role in the insurance sector and outlined a range of initiatives aimed at strengthening its status as a leading regional hub.
The annual summit, now in its eighth year, was organised by the Vocational Training Council’s Insurance Training Board to bring industry leaders together and discuss future opportunities and regulatory developments.
During his address, Chan underscored Hong Kong’s prominent position in the global insurance landscape, noting that it has the highest insurance penetration rate worldwide and a concentration of over 130,000 insurance professionals, among the highest in Asia.
“Hong Kong is a major insurance hub, boasting the highest concentration of insurance companies and insurance density in Asia. We also have the world’s highest insurance penetration rate,” he said.
He pointed to Hong Kong’s geographic and economic positioning, including its strong financial infrastructure, as significant assets that help the city attract global insurance companies.
He also cited recent growth in the sector, with gross premiums rising by more than 5% in the first half of 2024 to exceed HK$310 billion, as a sign of post-pandemic recovery and expanding regional demand.
According to Chan, Hong Kong’s insurance industry stands to gain from the Greater Bay Area (GBA) economic integration. Cross-border business potential is growing, particularly in insurance and investment products, as incomes rise within the GBA.
To capture this opportunity, Chan emphasised government support for after-sales service centres in Nansha and Qianhai, aimed at streamlining service and policy management for Hong Kong insurance clients residing in the GBA.
A key part of Hong Kong’s development strategy involves positioning the city as a global centre for risk management, particularly with respect to climate-related risks.
Chan highlighted Hong Kong’s issuance of five catastrophe bonds since 2021, valued collectively at over US$700 million and covering disasters such as earthquakes and storms. Some of these bonds have been listed on the Hong Kong Stock Exchange, reflecting the city’s expansion into insurance-linked securities as a way to transfer climate risk.
Chan also spoke on the integration of fintech into Hong Kong’s insurance market. Through digital distribution, virtual onboarding, and other technologies, insurers are now able to streamline client interactions, broaden their services, and reduce operating costs.
Since the Insurance Authority’s (IA) launch of the Insurtech Sandbox in 2017, companies have had the opportunity to test innovative tools and receive regulatory feedback before bringing products to market.
Hong Kong now has four licensed digital insurers, some of which have expanded internationally; one insurer recently finalised two agreements with partners in Saudi Arabia during a government-led business delegation.
The financial secretary also outlined regulatory developments designed to support the sector’s resilience and growth.
Recent measures introduced in chief executive John Lee’s policy address include updates to the risk-based capital regime, which aims to expand asset allocation options for insurers and encourage investments in infrastructure.
Chan also noted that Hong Kong is working to attract large Mainland companies, including state-owned enterprises, to establish captive insurers in the city.
Chan said that talent remains central to the government’s plans for industry growth. Since 2016, government initiatives have supported the creation of over 580 internship roles and 15,000 training opportunities, in collaboration with the Vocational Training Council.
He credited the council for its ongoing partnership in developing the next generation of insurance professionals and fostering sector expertise.
