New corporate governance standards for insurers authorised in Hong Kong came into effect on 1 January 2017. Hong Kong incorporated insurers and overseas insurers with a certain threshold of Hong Kong business must comply with the new guidance note 10 (“GN10“) issued by the Hong Kong regulator.
GN10 provides that the chairman of the insurer’s Board cannot also be the chief executive or appointed actuary of the business. Insurers are also required to produce business continuity plans and implement cybersecurity procedures.
In addition, from 1 January 2018 onwards, at least one third of the Board members of insurers (other than certain small insurers) must be independent non-executive directors, and there must also be a Board level risk committee. From that date, insurers are also required to have an appropriate remuneration policy for directors, senior management and material risk-taking employees which does not encourage inappropriate risk-taking.
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