Hong Kong targets captives growth
Hong Kong will play an increasing role as a captive hub, according to the administrative region’s insurance regulator.
The executive director of general business at the Insurance Authority said that the region was already playing an increasingly significant role in the global financial and insurance market.
“The establishment of captive insurance companies in Hong Kong has become a primary risk management solution for mainland enterprises to actively manage their overseas projects’ risks,” he told a breakout forum at the Belt and Road Summit, being held in Hong Kong.
“In the long run, these businesses will provide impetus to the insurance ecosystem in Hong Kong and reinforce our position as a global risk management centre and a regional re/insurance hub,” he continued.
The growth will be helped by the legislative amendment in March 2021 that is to expand the scope of insurable risks by captives, he added. The extension of preferential treatment by the China Banking and Insurance Regulatory Commission (CBIRC) for Hong Kong qualified reinsurers under the China Risk Oriented Solvency System would also help.
The forum discussed a wide range of key issues, including how to enhance enterprises’ awareness of risk management and the new risk landscape caused by the pandemic and geopolitical risks. It also looked at the importance of adopting a proactive approach and control in risk management and how to optimise cooperation between the Hong Kong, mainland and international insurance markets.
The summit is organised by the Hong Kong Special Administrative Region government and the Hong Kong Trade Development Council. It brings together government officials and business leaders to exchange insights, encourage co-operation and explore business opportunities under China’s Belt and Road Initiative.