Insurance Authority and CBIRC implement preferential measures to promote development of Hong Kong reinsurance industry

The Insurance Authority and the China Banking and Insurance Regulatory Commission have reached consensus that, under the "China Risk Oriented Solvency Testing System" (C-ROSS, commonly known as "C-ROSS II"), capital requirements for mainland insurance companies ceding business to qualifying professional reinsurers in Hong Kong will be reduced. The preferential measures are based on the framework agreement signed by the regulators of the two places on 16 May 2017, under which each other's solvency regulatory effectiveness is temporarily recognised as equivalent or similar during a transitional period of four years pending completion of the assessment work. For details, please refer to Notice CBIRC [2018] No. 34.