Abstract

Hong Kong’s insurance sector plays a vital role in the city’s robust financial landscape, contributing significantly to the economy and serving essential individual protection needs. However, ongoing governance is required to address issues that could undermine consumer confidence and market integrity. The article examines key conflicts of interest in Hong Kong’s insurance industry, including misaligned sales incentives, misleading information from agents, and lack of commission transparency. It proposes regulatory reforms such as standardized commission disclosure and the development of a “Policy Comparator” tool to empower customers and promote ethical practices. By implementing these evidence-based solutions, the insurance industry can enhance transparency, reduce information asymmetries, and incentivize suitable recommendations. Cooperation among regulators, insurers, and consumer advocates remains critical to maintain responsiveness to emerging risks and uphold customer-centric standards. Leveraging technology-enabled reforms, Hong Kong’s insurance sector is well-positioned to thrive while safeguarding vulnerable policyholders and public confidence in this crucial financial pillar.

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