In remarks on conduct supervision, the Hong Kong Insurance Authority outlined a tighter approach to sales oversight, enforcement and customer protection in the insurance market. The update centers on three phased measures for participating policies introduced since 2025, combined with closer monitoring of intermediaries and stronger action against misconduct, particularly around referral activity and sales practices. The phased measures comprise illustration rate caps effective July 2025, regulatory expectations on referral fees paid by broker companies effective October 2025, and a commission spreading mechanism for insurance intermediaries effective January 2026. Compliance oversight now combines operational data collection, on-site inspections and targeted spot checks, with a focus on illegal referrals and cross-boundary solicitation, while senior executives at licensed institutions are held accountable for compliance across the sales process. The authority also highlighted a recent enforcement step in early June, when it imposed licence renewal conditions on two insurance broker companies for failing to control referral activities effectively, requiring them to suspend the acceptance of referral business. The remarks also pointed to efforts to address repeat misconduct through reference checking. A scheme first introduced in September 2024 for individual insurance agents carrying on long-term business was expanded earlier in 2026 to insurance agencies and broker companies excluding banks. In July 2026, the Insurance Authority and the Hong Kong Monetary Authority launched a cross-sector reference checking arrangement covering more than 110,000 insurance intermediaries carrying on long-term business across about 1,000 insurance institutions and banks, with both regulators set to review and refine the arrangement and explore further integration of their mechanisms.
Hong Kong Insurance Authority2026-07-12
Hong Kong Insurance Authority highlights tougher conduct supervision, broker restrictions and cross-sector reference checks
The Hong Kong Insurance Authority said it is tightening conduct supervision through phased sales rules for participating policies, closer monitoring and stronger enforcement against improper referrals and sales misconduct. It highlighted June licence renewal conditions on two broker companies that must stop accepting referral business. The authority also launched a cross-sector reference checking arrangement with the Hong Kong Monetary Authority in July 2026 covering more than 110,000 long-term insurance intermediaries across about 1,000 insurance institutions and banks.