On 6 July 2023, the Insurance (Amendment) Ordinance 2023 (“Amendment Ordinance“) was enacted by the Legislative Council which provides the legal basis for the implementation of the risk-based capital (“RBC“) regime for the insurance industry in Hong Kong.
The RBC regime is targeted for implementation in 2024. Prior to its implementation, it is expected that the Insurance Authority of Hong Kong (“IA“) will further consult the insurance industry on the detailed rules and technical requirements of the RBC
regime. Based on the conclusions of the consultation, it is expected that new subsidiary legislation(s) will be promulgated to set out the detailed rules and technical requirements of the RBC regime.
Upon implementation of the RBC regime, it is proposed that insurers should be allowed to comply with the requirements relating to capital and disclosure under the RBC regime on a progressive basis. Such transitional provisions for compliance with the requirements will be prescribed by the IA by way of subsidiary legislation. We will monitor updates on the promulgation of the subsidiary legislation(s).
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