Hong Kong is an international financial hub with a mature legal and financial system, and its insurance market is transparent and well-developed. According to the Insurance Ordinance (Cap. 41 of Hong Kong Laws), anyone or any company conducting insurance broker business in Hong Kong must apply for and obtain an insurance broker licence from the Hong Kong Insurance Authority (IA, or “保監局” in Chinese) to legally carry out regulated activities, such as negotiating insurance contracts or providing insurance advice. Below is an introduction and detailed guide to the Hong Kong insurance broker company licence in Hong Kong English, with examples explaining what falls under an insurance broker’s scope of business and the differences between an insurance broker and an insurance agent!

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1. What’s a Hong Kong Insurance Broker Company Licence?

An insurance broker is someone who acts on behalf of policyholders or potential policyholders, running a business in Hong Kong or from Hong Kong to negotiate or arrange insurance contracts, or offering advice on insurance matters. In simple terms, they’re the “middleman” for clients, helping them find the best insurance products.

Examples: What’s within an Insurance Broker’s Scope of Business?

• Say you want to buy life insurance. An insurance broker will sit down with you, figure out your needs (like coverage amount or budget), then compare options from different insurance companies and recommend a few plans that suit you.
• If you’ve got a claim on an existing policy, they’ll help you talk to the insurance company, and if things get messy, they’ll advise you on how to sort it out.
• Or maybe you ask, “I want medical insurance—how do I choose?” They’ll look at your health and needs, then give you expert advice.

Unlike insurance agents, brokers don’t work for insurance companies to sell policies—they prioritise the client’s interests. Since 23 September 2019, the IA has taken full control of regulating insurance intermediaries, replacing the previous self-regulatory bodies like the Hong Kong Professional Insurance Brokers Association (PIBA) and the Hong Kong Confederation of Insurance Brokers (CIB). To get a licence, you need to meet the IA’s requirements and pass their review process.

Difference Between Insurance Brokers and Insurance Agents

• Insurance Broker: Represents the client, stays neutral, and can work with multiple insurance companies to find you the best deal. They earn commissions but won’t push one company’s products over others.
• Insurance Agent: Represents a specific insurance company (e.g., AIA, AXA) and only sells their products. Their job is to promote that company’s policies, so they lean towards the insurer’s side.
• Example: A broker is like your “personal consultant,” shopping around the market for you; an agent is like a “brand salesperson,” only pitching one company’s stuff.

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2. Eligibility and Requirements

To get a Hong Kong insurance broker company licence, you’ve got to tick a bunch of boxes—company setup, staff qualifications, financial standards, and compliance rules. Here’s the rundown:

1. Company Registration

• Company Type: Must be a company registered in Hong Kong or an overseas company registered with the Hong Kong Companies Registry.
• Physical Address: You need a real office address in Hong Kong (preferably a commercial building) for the IA to check.

2. Responsible Officer (RO) or Chief Executive (CE)

• Minimum Number: At least one Responsible Officer (RO) to oversee the insurance broker business.
• Qualifications:
  
  • Aged 21 or above;
  • A Hong Kong permanent resident, or holding a visa with no restrictions on doing insurance broker work;
  • A university bachelor’s degree or equivalent (other qualifications recognised by the IA are fine too);
  • Passing a recognised insurance exam (e.g., Insurance Intermediaries Qualifying Examination, IIQE);
  • At least 5 years of insurance industry experience, including 2 years in management.
• Reference Letters: Some applications may need 3 reference letters from insurance companies or business partners to vouch for the RO’s skills and network.

3. Capital and Net Assets

• Minimum Requirement: The company must always maintain at least HK$500,000 in paid-up capital and net assets (some older info says HK$100,000, but the latest standard is HK$500,000).
• How It’s Calculated: Net assets don’t include intangible assets and must follow Hong Kong’s recognised accounting principles.
• Where to Keep It: Funds must be in designated banks (e.g., HSBC, Minsheng Bank).

4. Professional Indemnity Insurance

• Minimum Coverage:
  
  • First year of operation: At least HK$3,000,000;
  • After one year: Twice the total income from the previous 12 months, or HK$3,000,000—whichever’s higher—up to a cap of HK$75,000,000.
• Excess (Deductible): Can’t exceed 50% of paid-up capital or last year’s net assets.
• Extra Rule: The policy must include at least one automatic reinstatement clause.

5. Separate Client Account

• You need at least one separate client bank account to keep client money apart from the company’s own funds, and you can’t use client money for anything else.

6. Books and Records

• The company must keep proper books and financial records, detailing all transactions, income, expenses, assets, and liabilities.
• Records must accurately reflect the business, be audit-ready, and kept for at least 7 years.

7. Competence and Fit-and-Proper Criteria

• The company needs a solid organisational structure, including good governance, internal controls, and risk management.
• The RO and staff must meet “fit-and-proper” standards—honest, no conflicts of interest, and professionally capable.

8. Technical Representative (TR)

• TRs help brokers deal with clients or arrange contracts. They need academic qualifications (e.g., 5 passes in the HKDSE, including a language and maths) and exam passes, plus IA registration.

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3. Application Process

1. Preparation Stage

• Register a Company: Set up a company in Hong Kong and get the certificate.
• Hire an RO: Make sure the RO has the right qualifications and experience.
• Prepare Documents:
  
  • Application form (Form A4, downloadable from the IA website);
  • Business plan (covering products, services, target clients);
  • Governance and control policies (e.g., compliance manual, anti-money laundering policy);
  • Financial proof (bank statements, net asset reports);
  • Professional indemnity insurance proof;
  • RO and TR qualification documents.
• Open Accounts: Set up a company account and a separate client account.

2. Submission

• Individual Licence: Submit via the “Insurance Intermediaries Connect” online platform and pay the fee.
• Company Licence: Send the application form and documents to the IA in writing. Pay the fee (by crossed cheque) after the IA confirms everything’s in order.
• Fees: Depend on the licence type and business scope—check the IA website’s fee table.

3. Review Stage

• The IA checks if your documents are complete and compliant. They might ask for more info or interview the RO.
• Takes about 3 to 6 months (around 4 months for new companies, depending on circumstances).

4. Getting the Licence

• Once approved, the IA issues the licence and lists the company and RO in the “Register of Licensed Insurance Intermediaries.”
• You and the RO get an email notification, and you can start operating.

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4. Ongoing Compliance

After getting the licence, you’ve got to follow these rules:

• Annual Reports: Submit financial statements and business reports yearly.
• Continuous Training (CPD): RO and staff need regular training.
• Client Protection: Put clients first with transparent, fair service.
• Updates: If company or personal details (e.g., address, phone) change, submit updates (Form N3 or N4) within 14 days.
• Member Register: Per Section 69 of the Insurance Ordinance, keep a member register at your Hong Kong registered office, open for public inspection.

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5. Common Questions During Application

1. How Long Does It Take?
   • Usually 3 to 6 months—around 3 months if all documents are ready.
2. Can a Company Be Both a Broker and an Agent?
   • No, the IA says one company can’t do both.
3. Does Capital Need to Be Fully Paid Up?
   • No strict rule, but you must always meet the minimum net asset level.
4. How to Check Progress?
   • Ask your appointing principal or check “Insurance Intermediaries Connect.” Once approved, it’s on the register.

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6. Pros and Cons

Pros

• Hong Kong’s market is transparent with lots of business opportunities, great for international clients.
• A licence lets you work with multiple insurers, offering diverse products.

Cons

• Applying and maintaining the licence is pricey (capital, insurance costs, etc.).
• Compliance rules are strict—you need resources to stay on track.

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7. Wrap-Up

Applying for a Hong Kong insurance broker company licence takes careful planning. You need solid funding, the right people, and a strong compliance setup.