Hong Kong’s Insurance Authority (IA) has launched a public consultation on higher fee and levy caps for the long term insurance sector.

The proposals cover both the annual fees paid by insurers and the premium levy paid by policyholders.

The changes would amend two sets of rules under the Insurance Ordinance. These are the Insurance (Authorization and Annual Fees) Regulation and the Insurance (Levy) Order.

Authorised long term insurers currently pay an annual fee that includes a variable component.

The IA proposes raising the cap on this component from HK$7 million to HK$28 million. Its rate would also increase from 0.0039% to 0.0042% of insurance liabilities.

Policyholders would continue to pay a levy of 0.1% on long term policy premiums. However, the maximum levy per policy would rise from HK$100 to HK$500 or HK$1,000.

At present, the HK$100 cap applies to policies with single or annualised premiums of HK$100,000 or more. Policies below this threshold would therefore see no change to the levy they pay.

According to an IA spokesperson, the review is in line with the original design of the regulator’s funding mechanism.

The spokesperson added that it aims to ensure the IA “can effectively discharge its statutory functions on a sustainable basis, while limiting the impact on policy holders and international competitiveness of the insurance industry”.

The consultation paper is available on the IA website, and the regulator will accept public comments on or before 3 December 2026.

Featured image: Edited by Fintech News Hong Kong, based on image by lifeforstock via Magnific.