The Hong Kong Mortgage Corporation (HKMC) has announced that, with effect from 1 May 2018, its general insurance business will be transferred to "HKMC Insurance Limited", a wholly owned subsidiary.
The business includes the Mortgage Insurance Programme, Reverse Mortgage Programme, Premium Loan Insurance Scheme and SME Financing Guarantee Scheme. All general insurance business will not be affected by the business transfer and will operate as usual.
In addition, the HKMC announced last year that it would introduce a Life Annuity Scheme (LAS) by the middle of this year, that is classified as long term insurance business.
According to regulatory requirements, the HKMC cannot operate general insurance business and long term insurance business at the same time.
The HKMC has therefore established two wholly owned subsidiaries to operate separately the LAS and the existing general insurance business.