Insurance Broker Licence Application (Hong Kong)

A Hong Kong Insurance Broker Licence Application is the formal application submitted to the Insurance Authority (IA) for authorisation to carry on insurance broking business in Hong Kong under the Insurance Ordinance (Cap. 41). The application covers both the licensed insurance broker company — the corporate entity authorised to carry on the broking business — and the licensed technical representatives (brokers) who are individuals performing regulated activities for the broker company. Without IA authorisation, no person may lawfully carry on insurance broking business in Hong Kong.

The Insurance Ordinance (Cap. 41) defines insurance broking business as arranging contracts of insurance between policyholders (clients) and insurers, advising clients on insurance matters, and handling claims and other matters on behalf of clients. An insurance broker acts as the agent of the client, which distinguishes brokers from insurance agents who act as agents of the insurer. This distinction has profound legal consequences: a broker owes fiduciary duties to the client, including the duty to act in the client's best interests, to disclose conflicts of interest, and to recommend only suitable products.

The regulatory responsibility for licensing and supervising insurance intermediaries in Hong Kong was transferred from two industry self-regulatory organisations — the Hong Kong Confederation of Insurance Brokers (CIB) and the Professional Insurance Brokers Association (PIBA) — to the Insurance Authority (IA) with effect from 23 September 2019. The IA is an independent statutory body established under the Insurance Ordinance. The transition to direct IA regulation represented a significant strengthening of the regulatory framework for insurance intermediaries in Hong Kong, bringing the broker licensing regime in line with international standards and the regulatory approach adopted for other licensed financial intermediaries in Hong Kong.

The IA issues two categories of insurance broker licence: licensed insurance broker companies (corporate entities) and licensed technical representatives (broker) (individuals). A broker company must hold a minimum net asset requirement of HK$3 million and maintain minimum professional indemnity insurance (PII) cover of HK$3 million per claim. These financial requirements protect policyholders and third parties against losses arising from the broker company's professional negligence.

The IA's Code of Conduct for Licensed Insurance Intermediaries sets out the conduct standards that apply to all licensed insurance brokers, including the obligation to act in clients' best interests, to conduct needs analysis, to make suitable product recommendations, to disclose remuneration, to handle client money in accordance with the premium trust account requirements under Cap. 41, and to maintain records. The IA monitors compliance through an active inspection programme and has powers to take disciplinary action — including revocation of licences and imposition of financial penalties — against intermediaries who breach the code. Section 64 of the Insurance Ordinance (Cap. 41) governs the authorisation of insurers; section 70 covers the IA's licensing powers over intermediaries including broker companies; section 72 addresses policyholder protections enforceable by the IA. Section 7 of the Anti-Money Laundering and Counter-Terrorist Financing Ordinance (Cap. 615) imposes customer due diligence obligations on licensed insurance intermediaries. Section 4 of the Limitation Ordinance (Cap. 347) sets the standard 6-year limitation period for contract claims arising from broker activities.

A Hong Kong Insurance Broker Licence Application to the Insurance Authority is required in the following circumstances involving persons seeking to carry on insurance broking business in Hong Kong.

A new company proposing to establish an insurance broking business in Hong Kong must apply for a licensed insurance broker company licence from the IA before commencing business. The application must demonstrate that the company satisfies the IA's financial requirements (minimum net assets of HK$3 million), has appointed a responsible officer who meets the IA's fitness and propriety criteria, has obtained or will obtain the required professional indemnity insurance, and has established the operational infrastructure, compliance systems, and governance arrangements required by the Insurance Ordinance (Cap. 41) and the IA's guidelines.

An individual who intends to perform regulated activities — such as arranging insurance contracts, advising clients on insurance, or handling claims — for a licensed insurance broker company must apply for a licensed technical representative (broker) licence from the IA. Each technical representative must hold their own individual licence and must be employed or engaged by a licensed broker company. A technical representative licence application requires the individual to demonstrate relevant qualifications, pass required examinations, and confirm their fitness and propriety.

An existing insurance broker company that was licensed under the previous self-regulatory regime (through CIB or PIBA) and has transitioned to IA regulation must maintain its IA authorisation and renew it annually. Failure to renew the IA licence — for example, by failing to file audited annual accounts on time, failing to maintain the minimum net asset requirement, or failing to renew the professional indemnity insurance — can result in suspension or revocation of the licence.

A licensed insurance broker company that wishes to expand its business — for example, by adding a new class of insurance (adding long-term insurance to an existing general insurance business, or vice versa) — must notify the IA and may need to apply for an extension of its licence conditions. The IA assesses whether the company has the competence, systems, and financial resources to handle the additional class of business.

A foreign insurance broker seeking to establish a presence in Hong Kong to service Hong Kong clients must either establish a Hong Kong subsidiary that applies for a broker company licence, or confirm that the Hong Kong-based activities are conducted through or by a licensed Hong Kong broker company. Cross-border broker services provided by foreign brokers directly to Hong Kong clients without IA authorisation may constitute unlicensed insurance broking business.

A Hong Kong Insurance Broker Licence Application to the Insurance Authority under Cap. 41 must include the following key elements to constitute a complete submission and to demonstrate compliance with the IA's licensing requirements.

The application form for a licensed insurance broker company must be completed in full and signed by the responsible officer of the applicant company. The IA's application forms are available from the IA's official website. The form requires disclosure of: the company's full registered name, company registration number, registered office and principal place of business, date of incorporation, and the class(es) of insurance business (general, long-term, or both) in which the company intends to carry on broking activities.

The responsible officer (RO) appointment is a key licensing requirement. Every licensed insurance broker company must have at least one responsible officer — an individual who is fit and proper and who holds a licensed technical representative (broker) licence. The RO is responsible for overseeing the compliance of the broker company with the Insurance Ordinance and the IA's codes of conduct. The application must identify the proposed RO and include their personal details, qualifications, professional experience, and a declaration of their fitness and propriety.

The fitness and propriety declaration is required for each director, controller, and responsible officer of the applicant company. The declaration must disclose any criminal convictions, regulatory sanctions, bankruptcies, civil judgments, or other matters relevant to the person's fitness and propriety to hold an insurance intermediary licence in Hong Kong. The IA applies the fit and proper criteria set out in its Fit and Proper Guidelines for Insurance Intermediaries.

The minimum net assets evidence must demonstrate that the applicant company has net assets of at least HK$3 million at the time of application. This is typically demonstrated by a statement of financial position (balance sheet) prepared by a Certified Public Accountant (CPA). For a newly incorporated company, the paid-up share capital and any initial working capital injections must total at least HK$3 million.

The professional indemnity insurance (PII) confirmation must evidence that the applicant company has obtained or has a firm commitment to obtain PII cover of at least HK$3 million per claim from an insurer acceptable to the IA. A PII certificate or a letter of commitment from an insurer or insurance broker arranging the PII must be submitted with the application.

The business plan must describe the proposed insurance broking operations, including: the target market and client types; the classes of insurance to be arranged; the proposed insurer panel; the distribution model (direct to clients, through introducers, or through technology platforms); the compliance and governance arrangements; the staff complement; and the projected financial performance for the first three years of operation.

The compliance manual and AML/CFT policy must demonstrate that the applicant company has the required internal controls, including an Anti-Money Laundering and Counter-Terrorist Financing policy compliant with Cap. 615 and the IA's AML/CFT guidelines, a complaints handling procedure, and a code of conduct for staff aligned with the IA's Code of Conduct for Licensed Insurance Intermediaries. Section 64 of the Insurance Ordinance (Cap. 41) sets authorisation requirements; section 70 covers the IA's licensing powers over intermediaries; section 72 addresses policyholder protections. Section 7 of the Anti-Money Laundering and Counter-Terrorist Financing Ordinance (Cap. 615) imposes customer due diligence obligations on licensed insurance intermediaries. Section 4 of the Limitation Ordinance (Cap. 347) provides the standard 6-year limitation period for contract claims arising from licensed broker activities. The IA's Fit and Proper Guidelines for Insurance Intermediaries, the Fund Manager Code of Conduct, and the IA's Code of Conduct for Licensed Insurance Intermediaries are all publicly available on the IA's official website at ia.org.hk. Section 8 of the Insurance Ordinance (Cap. 41) imposes conduct obligations on all authorised insurers. Section 16 of Cap. 41 sets out the IA's powers to revoke or suspend a broker company licence. Section 64 of Cap. 41 covers authorisation of insurers dealing with licensed broker companies. Section 22 of the Anti-Money Laundering and Counter-Terrorist Financing Ordinance (Cap. 615) requires licensed insurance intermediaries to maintain customer due diligence records for at least five years. Section 9 of Cap. 615 sets out enhanced due diligence requirements for politically exposed persons. The Insurance Complaints Bureau, the Hong Kong Confederation of Insurance Brokers, and the Professional Insurance Brokers Association are all relevant industry bodies. Download a free Insurance Broker Licence Application template and supporting document checklist at forms-legal.com. Related documents include the HK Anti-Money Laundering Policy, HK Data Protection Policy, and HK Service Agreement.