Regulatory Alerts2025-11-19
Added · Updated
Observations from Review on Premium Financing Activities for Insurance Policies
The Hong Kong Monetary Authority issued this circular to clarify expected standards for authorized institutions offering premium financing facilities following a review of practices in an elevated interest rate environment. The regulator mandates that institutions clearly separate financing from insurance applications, avoid promoting premium financing as a return-enhancing strategy, and provide comprehensive disclosures of associated risks such as interest rate fluctuations and early surrender penalties. These requirements apply to new facilities entered into on or after 1 January 2026, with institutions also expected to adopt good practices for assisting customers experiencing financial distress.
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