Insurance Premium Levy
Starting from 1 January 2018, the Insurance Authority (IA) will collect a levy on insurance premiums from policy holders. The levy will be collected by insurance companies like FWD. Policy holders must pay the levy in accordance with the law. It is an offence for a policy holder to fail to pay the levy in a timely manner, and the policy holder may be liable to a pecuniary penalty.
Except for certain policies (reinsurance business, policies underwritten by authorized captive insurers, and marine, aviation and goods-in-transit business are exempted from the levy by law), policy holders of all new or in-force life insurance policies and general insurance policies must pay the levy along with their premium payment.
The following table summarizes the levy rates and cap for respective years for life and general insurance policies-
A policy inception date or a policy anniversary which marks the beginning of a policy year | Levy rate% | Levy cap | Levy cap |
A policy inception date or a policy anniversary which marks the beginning of a policy year | Levy rate% | Levy cap | Levy cap |
From 1 Jan 2018 till 31 Mar 2019 (both dates inclusive) | 0.04% | HK$40 | HK$2,000 |
From 1 Apr 2019 till 31 Mar 2020 (both dates inclusive) | 0.06% | HK$60 | HK$3,000 |
From 1 Apr 2020 till 31 Mar 2021 (both dates inclusive) | 0.085% | HK$85 | HK$4,250 |
From 1 Apr 2021 onwards (date inclusive) | 0.1% | HK$100 | HK$5,000 |
https://www.ia.org.hk/en/aboutus/role/financial_arrangements.
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