On 28 April 2009, the SFC released a circular setting out that under the SFO a corporation which is either a participant of the Stock Exchange of Hong Kong Limited and is licensed for Type 1 regulated activities (dealing in securities) (Category One), or is a participant of the Hong Kong Futures Exchange Limited and licensed for Type 2 regulated activities (dealing in futures contracts) (Category Two), is required to take out and maintain insurance against specific risks for a specified amount, following the SFC’s approval of a master policy of insurance applicable to the relevant corporation.

For the period from 1 April 2009 to 31 March 2010, two master policies of insurance, arranged by Jardine Lloyd Thompson Limited, will cover respectively the licensed corporations in Category One and Category Two.

Under the master insurance policies, an insured participant will be indemnified against financial losses due to fidelity risks relating to its activities of dealing in securities and/or futures contracts, subject to an indemnity limit of $15 million per regulated activity per year and a deductible amount of $3 million per claim/loss.