No need to know Chinese: Hong Kong’s new insurance regulator looking for global talent as head
The head of Hong Kong’s new insurance regulator will be chosen through a global search and is not required to know Chinese.
The newly established Insurance Authority has appointed a head hunting firm to recruit about 300 staff, the chief executive and five executive directors, chairman Moses Cheng Mo-chi told the South China Morning Post in an exclusive interview.
“We are now in the process of getting the right team on board to get the new regulator running by the end of this year at the earliest,” Cheng said.
Cheng refused to comment on the pay of the chief executive but said the compensation would take into account that for chief executives of other regulatory bodies in the city as reference.
The Mandatory Provident Fund Scheme Authority, the Securities and Futures Commission and the Hong Kong Monetary Authority all pay their chief executives between HK$4 million and HK$10 million.
“It will be a global search. We want to have the best talent with knowledge of the insurance industry and regulations. We are not looking for only local Chinese but overseas talent as well, since Hong Kong is an international financial centre. The chief executive is not required to know Chinese,” he said.
Lawmakers last year passed a legislation paving the way for the setting up of the new powerful insurance regulator with an initial government funding of HK$650 million. It will charge policyholder levies and insurance licence fees to finance its operation.
The government appointed Cheng, a veteran solicitor and former director of Hong Kong Exchanges and Clearing, to head the eight-member board handling the creation of the new regulator.
The new watchdog will replace and will have more teeth than the Office of Commissioner of Insurance, which only regulates insurance companies but not their salespeople. Twenty civil servants will be shifted to other government departments while the rest of about 80 staff would leave after the new authority takes over the responsibilities of the current body. They can apply for jobs at the Insurance Authority.
The new authority will be empowered to issue licences and regulate the 80,000-odd insurance salespeople in the city. Currently they do not require any licences and are allegedly not regulated properly, with several complaints of misselling of complicated investment-linked policies.
“It is important for the new body to bring in appropriate regulation to prevent misselling. It is also important to establish a good corporate governance culture in the industry,” he said.
The China Insurance Regulatory Commission recently warned mainland Chinese to be aware of the risks of buying insurance products in Hong Kong because of the difference in laws and regulations in Hong Kong. Mainlanders last year spent HK$31 billion on insurance products in Hong Kong, representing nearly a quarter of the total premium collected in the city.
“We welcome mainlanders to continue to buy insurance products in Hong Kong. We will make sure the salespeople will not mislead policyholders. We will also have education programmes to inform mainlanders of the questions they need to ask when buying policies in order to protect themselves.”
He said such regulatory work has already been initiated by the Office if Insurance Commissioner, which from April 1 started to issue a new guidance note on the future projections of insurance policies.