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Enforcement > Licensed Insurance Intermediaries > Licensed Insurance Intermediaries

Licensed Insurance Intermediaries

Investigation

For more effective regulation of licensed insurance intermediaries and better protection of the interests of policy holders, the Insurance Authority (“IA”) has been provided with express powers under Insurance Ordinance (Cap. 41) (“IO”) to initiate investigation and impose a range of disciplinary sanctions on regulated persons which includes the licensed insurance intermediary, the responsible officer and the person concerned in the management of regulated activities.

The IA may initiate an investigation under section 64ZZH of the IO if the IA:

  1. has reasonable cause to believe that a provision of the IO may have been contravened;
  2. has reasonable cause to believe that a person may have been involved in defalcation, fraud, misfeasance or other misconduct in relation to the carrying on of a regulated activity;
  3. has reasonable cause to believe that a person has carried on, or is carrying on, a regulated activity in a manner that is not in the interests of policy holders or potential policy holders or the public interest; or
  4. has reason to enquire if a person is or was guilty of misconduct; or a person is or was not a fit and proper person.

The appointed investigators may require a person to produce a record or document, give an explanation in respect of the record or document, answer a question relating to the investigation, and give other assistance.

Disciplinary Action

The IA may take disciplinary actions against regulated person if the person is or was guilty of misconduct, or when the person is or was, in the opinion of the IA, not fit and proper under section 81 of the IO.

Before the IA exercises the disciplinary power, the regulated person concerned would have a reasonable opportunity of being heard which may take the form of making written or oral representations.

If the IA decides to exercise the disciplinary power, the decision would be issued to the regulated person concerned by notice in writing which must include:

  1. a statement of the reasons for the decision;
  2. the time when the decision is to take effect; and
  3. the sanction (whichever of the following is applicable):
    • the duration and terms of any revocation, suspension or prohibition to be imposed under the decision;
    • the terms of any reprimand; and
    • the amount of any pecuniary penalty to be imposed and the period within which it is required to be paid.
The disciplinary actions may include:
  • private or public reprimand;
  • pecuniary penalty not exceeding the greater of HK$10 million or 3 times the profit gained or loss avoided as a result of the contravention;
  • suspension of licence;
  • revocation of licence;
  • prohibition of application for licence;
  • suspension of approval to be a responsible officer;
  • revocation of approval to be a responsible officer; and
  • prohibition of appointment to be a responsible officer.

In exercising the IA’s power to impose pecuniary penalty, the IA shall have regard to the Guideline on Exercising Power to Impose Pecuniary Penalty in respect of Regulated Persons under the Insurance Ordinance (Cap. 41) (GL22) for factors to be considered.

IA’s disciplinary decisions made under the IO are appealable to a statutory and independent body, the Insurance Appeals Tribunal (“IAT”). If the affected person is aggrieved by the disciplinary decision of the IA, the person may apply in writing to the IAT for the decision to be reviewed within 21 days after a notice informing the person of the decision has been served.

For details, please refer to Overview of Disciplinary Process.