The Hong Kong Insurance Authority (IA) has announced significant proposals aimed at revising its financial regulations, potentially leading to increased costs for long-term insurers and policyholders. These proposed changes, currently under public consultation, include a substantial increase in the annual fee cap for authorized long-term insurers and an upward adjustment to the premium levy paid by policyholders. The IA's objective behind these revisions is to fortify its financial stability, enabling it to continue its statutory functions effectively, whilst carefully weighing the implications for both the insurance sector's competitiveness on a global scale and the financial burden on policyholders.
On 4 November 2026, the IA formally launched a public consultation concerning amendments to the Insurance (Authorisation and Annual Fees) Regulation (Cap. 41C) and the Insurance (Levy) Order (Cap. 41J). A central element of these proposed changes is the intention to elevate the ceiling for the variable component of annual fees imposed on long-term insurers. The current cap of $910,000 (HK$7 million) is proposed to be dramatically increased to $3.6 million (HK$28 million). Concurrently, the associated rate applied to insurance liabilities would see a modest rise from 0.0039% to 0.0042%.
Beyond the direct impact on insurers, policyholders are also slated to experience adjustments. The maximum premium levy for long-term policyholders is proposed to increase from $13 (HK$100) to either $65 (HK$500) or $130 (HK$1,000). Despite this increase in the cap, the levy rate itself is intended to remain unchanged at 0.1%. These measures reflect the IA's strategic approach to securing adequate funding for its operations in a sustainable manner.
A spokesperson for the Insurance Authority emphasized that this comprehensive review is crucial for guaranteeing the authority's capacity to fulfil its mandated duties without compromise. The review process is designed to strike a delicate balance between ensuring the IA's operational sustainability and mitigating any adverse effects on the broader insurance market and its consumers. The authority aims to foster a regulatory environment that remains robust and internationally competitive, supporting the development of Hong Kong's insurance industry.
The consultation document, which details all proposed amendments and their rationale, is readily accessible on the IA's official website. Stakeholders, industry professionals, and the general public are encouraged to review the proposals and submit their feedback. The window for submissions will close on 3 December 2026, providing ample opportunity for all interested parties to contribute to this important regulatory dialogue and shape the future landscape of insurance regulation in Hong Kong.