BUYING life or medical coverage in Hong Kong will become less risky for clients taking their first steps in the insurance world following amendments to the Insurance Ordinance. Legislation, effective this year, would protect consumers from 'rip-off' insurance agents and brokers, said Darrel Yuen Kam-sung, president of Asia Operations of Transamerica Occidental Life. Amendment Three to the Insurance Ordinance, passed in July, was part of the industry's push for self-regulation and did not impose guidelines. Agents and brokers not registered with the Federation of Insurers and those who breached the legislation would face stiff penalties. 'The legislation supports local insurers that have united to control intermediaries and focuses on standards for agents and brokers,' Mr Yuen said. 'It is a solid step towards regulating agent and broker activities and will provide a higher level of consumer protection.' While insurance companies would qualify and train agents, brokers had to hold $100,000, have professional indemnity insurance and have experience in the local industry. Insurance companies were satisfied with the stringent screening process for brokers, Mr Yuen said. 'It's very tough but will keep the industry clean and professional and ensure brokers are going to remain in the sector long-term. 'With such high standards for brokers, the next step could be to instigate higher standards for agents.' The ordinance defined the role of an agent and a broker and outlined differences between the two, he said. Under the ordinance, an agent was someone representing an insurance company and a broker represented a client.