Hong Kong regulator puts a 50% cap on referral fees for insurance sales



Hong Kong insurance companies and brokers from Wednesday are barred from paying excessive referral fees to unlicensed individuals, as the city’s insurance regulator bolsters efforts to curb misconduct and enhance customer protection.
The city’s Insurance Authority has put a 50 per cent cap on commissions for referral fees in life insurance policies, a move that provides long-term life protection and dividends to policyholders, according to the regulator’s circular.
The regulation takes effect at the start of the National Day holiday – also known as the “golden week” – when millions of mainland Chinese visitors visit Hong Kong, which also serves as an opportune time for many of them to buy new insurance policies in the city.

“The Insurance Authority expressed concern about business models that could incentivise unlicensed selling of long-term insurance policies, particularly those adopted by licensed insurance broker companies relying solely or heavily on referrers,” the regulator said in the circular.

“Market feedback indicates that the current situation, if left unchecked, could breed misconduct, erode public confidence and impair market sustainability.”

  • Related Posts

    What is the Sunset Clause that India may demand in its trade deal with the US? – Firstpost

    India and the United States are very close to concluding what could become one of their most consequential economic agreements in recent years. But recent reports suggest that a “Sunset…

    Continue reading
    India to resume train coach exports to Bangladesh; first shipment since Hasina’s ouster likely in July – Firstpost

    India is set to resume exports of railway passenger coaches to Bangladesh, with the first shipment likely to leave next month, marking the first such delivery since the political upheaval…

    Continue reading

    Leave a Reply

    Your email address will not be published. Required fields are marked *