Cap. 41 sub. leg. C

Insurance (Authorization and Annual Fees) Regulation(Cap. 41, section 128(1)) (Enacting provision omitted—E.R. 4 of 2017)[20 November 1992] L.N. 376 of 1992 Editorial Note: The title of this Regulation was amended from “Insurance Companies (Authorization and Annual Fees) Regulation” to “Insurance (Authorization and Annual Fees) Regulation” — see L.N. 58 of 2017. 1. (Omitted as spent—E.R. 4 of 2017) 1A. Interpretation In this Regulation— insurance liabilities (保險負債), for an authorized insurer in relation to a payment due date— (a) for long term business, means— (L.N. 56 of 2024)(i) if the financial information last provided by the authorized insurer to the Authority before the payment due date was submitted under section 17 of the pre-amended Ordinance—the amount of net liability specified in Form HKL2 (set out in Schedule 3 to the pre-amended Ordinance) so submitted to the Authority; or(ii) if the financial information last provided by the authorized insurer to the Authority before the payment due date was submitted under rule 4(1) of the Insurance (Submission of Statements, Reports and Information) Rules (Cap. 41 sub. leg. S)—the difference between— (E.R. 1 of 2025)(A) its total insurance liabilities (gross of reinsurance) relating to long term business; and(B) the portion of those insurance liabilities belonging to branch insurance operations outside Hong Kong,specified in the form providing information with respect to the authorized insurer’s financial position so submitted to the Authority; (b) for general business, means— (L.N. 56 of 2024)(i) if the financial information last provided by the authorized insurer to the Authority before the payment due date was submitted under section 17 of the pre-amended Ordinance—the aggregate of—(A) the amount of unexpired risks carried forward;(B) the provision for outstanding claims (net amount); and(C) the provision for IBNR,specified in Forms 1A and 2A (set out in Schedule 3 to the pre-amended Ordinance) so submitted to the Authority; or(ii) if the financial information last provided by the authorized insurer to the Authority before the payment due date was submitted under rule 4(1) of the Insurance (Submission of Statements, Reports and Information) Rules (Cap. 41 sub. leg. S)—the difference between— (E.R. 1 of 2025)(A) its total insurance liabilities (gross of reinsurance) relating to general business; and(B) the portion of those insurance liabilities belonging to branch insurance operations outside Hong Kong,specified in the form providing information with respect to the authorized insurer’s financial position so submitted to the Authority; payment due date (付款到期日)— (a) for the prescribed fees payable under section 13(1)(a) of the Ordinance, means the date on which the authorized insurer is authorized; (b) for the prescribed fees payable under section 13(1)(b) of the Ordinance, means each anniversary of the date referred to in paragraph (a); pre-amended Ordinance (《原有條例》) means the Ordinance as in force immediately before the date on which Part 2 of the Insurance (Amendment) Ordinance 2023 (20 of 2023) comes into operation*; (L.N. 56 of 2024)variable fee (非固定費用)—see section 3.(L.N. 58 of 2017) Editorial Note: * Operation date: 1 July 2024. 2. Prescribed fees under section 13(1)(a) and (b) of Ordinance The fees payable under section 13(1)(a) and (b) of the Ordinance are as follows—(a) for an authorized insurer (other than a captive insurer or special purpose insurer)—the aggregate of a fixed fee and a variable fee set out in Schedule 1;(b) for an authorized insurer which is a captive insurer—the aggregate of a fixed fee and a variable fee set out in Schedule 2;(c) for an authorized insurer which is a special purpose insurer—a fixed fee set out in Schedule 2A.(L.N. 2 of 2021) 3. Determination of variable fee (1) This section applies to the determination of a variable fee payable by an authorized insurer on a payment due date.(2) For Schedule 1, the variable fee is—(a) the amount determined by multiplying the insurance liabilities of the authorized insurer (floored at zero if it is a negative amount) by the variable fee rate corresponding to the reference period in which the payment due date falls; or (L.N. 56 of 2024)(b) $7,000,000,whichever is the lower.(3) For Schedule 2, the variable fee is the amount determined by multiplying the insurance liabilities of the authorized insurer (floored at zero if it is a negative amount) by the variable fee rate corresponding to the reference period in which the payment due date falls. (L.N. 56 of 2024)(4) The variable fee rates are set out in Schedule 3.(L.N. 58 of 2017) Schedule 1 [ss. 2 & 3]Fees Payable under Section 13(1)(a) and (b) of Ordinance by Authorized Insurer (other than Captive Insurer or Special Purpose Insurer) (L.N. 2 of 2021) Column 1 Column 2 Column 3 Column 4 Column 5 Item Section of Ordinance Fee to be paid Class of insurance business authorized to be carried on by authorized insurer (other than captive insurer or special purpose insurer) Fee (L.N. 2 of 2021; L.N. 56 of 2024) 1. Section 13(1)(a) Fee payable upon authorization (a) Long term business The aggregate of a fixed fee of $300,000 and a variable fee (b) General business The aggregate of a fixed fee of $300,000 and a variable fee (c) Both long term business and general business The aggregate of the fees payable under (a) and (b) 2. Section 13(1)(b) Annual fee (a) Long term business The aggregate of a fixed fee of $300,000 and a variable fee (b) General business The aggregate of a fixed fee of $300,000 and a variable fee (c) Both long term business and general business The aggregate of the fees payable under (a) and (b) (Schedule 1 replaced L.N. 58 of 2017) Schedule 2 [ss. 2 & 3]Fees Payable under Section 13(1)(a) and (b) of Ordinance by Captive Insurer (L.N. 2 of 2021) Column 1 Column 2 Column 3 Column 4 Item Section of Ordinance Fee to bepaid Fee 1. Section 13(1)(a) Fee payableuponauthorization The aggregate of a fixed fee of $30,000 and a variable fee 2. Section 13(1)(b) Annual fee The aggregate of a fixed fee of $30,000 and a variable fee (Schedule 2 replaced L.N. 58 of 2017) Schedule 2A [s. 2]Fees Payable under Section 13(1)(a) and (b) of Ordinance by Special Purpose Insurer Column 1 Column 2 Column 3 Column 4 Item Section of Ordinance Fee to bepaid Fee 1. Section 13(1)(a) Fee payableuponauthorization A fixed fee of $15,000 2. Section 13(1)(b) Annual fee A fixed fee of $15,000 (Schedule 2A added L.N. 2 of 2021) Schedule 3 [s. 3] Variable Fee Rates Column 1 Column 2 Reference period Variable fee rate From 26 June 2017 to 25 June 2018 0.0001% From 26 June 2018 to 25 June 2019 0.0005% From 26 June 2019 to 25 June 2020 0.0013% From 26 June 2020 to 25 June 2021 0.0026% From 26 June 2021 to 25 June 2022 0.0031% From 26 June 2022 to 25 June 2023 and each subsequent period of 1 year from 26 June 0.0039% (Schedule 3 added L.N. 58 of 2017)