Proposed Changes in Hong Kong's Insurance Capital Norms Credit Neutral, Fitch Says

MT Newswires Live02-17

Fitch Ratings expects proposed amendments to Hong Kong's insurance capital rules to be credit neutral to rated entities despite some easing of regulatory burden, according to a recent release.

The introduction of preferential capital treatment for infrastructure assets aims to align life insurers' long-term liabilities with regional development projects.

The reforms also address volatile crypto assets and stablecoins, but Fitch expects limited adoption due to high volatility and a lack of yield.

International insurers will benefit from a recalibrated approach to natural catastrophe risk, which will better recognize the diversification of risks across different geographic regions.

Fitch said it will continue to prioritize its Prism Global model when assessing overall solvency.

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