The Insurance Authority (IA) held its Asian Insurance Forum (AIF) on 8 December 2025 under the theme "Navigating Uncertainties and Embracing Innovation."
The eighth edition gathered international industry leaders, regulators and policymakers to discuss supervisory cooperation, ageing and healthcare needs and the growing role of AI.
The event was aimed at providing global perspectives on how insurance markets are adapting to uncertainty and accelerating innovation.
Before commencement of the proceedings, all participants observed a moment of silence dedicated to victims affected by the tragic fire at Wang Fuk Court in Tai Po.
Insurers face rising rate and climate risks
In his keynote speech, National Financial Regulatory Administration Vice Minister Xiao Yuanqi shared his thoughts on the global insurance landscape, namely interest rate risk management, climate change, AI application, regulatory issues arising from increasing interconnection between insurers and other non-bank financial assets, and insurers’ business models.
“First, we need to pay closer attention to interest rate risk in infrastructure and insurance operations. Interest rate movements significantly affect both the asset and liability sides of insurers’ balance sheets, and effective management of this risk reflects a company’s core competitiveness,” Mr Xiao said.
“For nearly two decades before 2022, many markets operated in a prolonged low-interest-rate environment, with some even entering zero or negative rates. Many in the international community believed such conditions would persist, and insurers built their business models around that assumption. However, 2022 brought a sharp reversal. In response to rising inflation, the US Federal Reserve raised rates 11 times: over 5% in a short span. Other major economies also lifted rates to high levels,” he added.
Looking ahead, he said insurers must allocate new assets and liabilities with the expectation of more frequent, volatile and two-way movements in interest rates.
Mr Xiao also mentioned that climate change has become one of the most serious challenges facing society as global temperatures continue to rise.
“Extreme weather events, including typhoons, floods and mudslides, are occurring more frequently in mainland China. Rainfall patterns have also shifted, with the northern region experiencing unusually high rainfall in recent years, a scenario once considered unimaginable. These changes are increasingly affecting public health and economic growth,” he said.
For the insurance industry, the impact is twofold.
“First, insurers must reassess actuarial assumptions and reprice products and investments, a process that requires significant data and model enhancements that cannot be achieved overnight. Second, climate volatility may reduce the industry’s appetite to launch new products, potentially widening protection gaps and creating imbalances between supply and demand. Insurers may also need to rely more heavily on reinsurance to diversify risk,” he added.
To end, he said despite the challenges, new opportunities could emerge.
“If the industry can effectively manage both physical and transition risks, it may unlock fresh business potential. Climate change has also strengthened public awareness of the importance of insurance,” he said.
IA plans and strategies for 2026
In a joint closing address, Insurance Authority (IA) Chairman Stephen Yiu Kin-Wah and CEO Clement Cheung Wan-Ching unveiled IA’s plans and strategies for 2026.
Following the Tai Po Fire, a task force was quickly set up by IA to coordinate insurers and manage claims. Using available resources, they identified over 10,000 life insurance and 1,800 casualty policies, reaching out to victims and their families to provide support.
Secondly, Messrs Yiu and Cheung said the IA is looking into medical insurance and how to support the ageing population.
“The strategy revolves around three main streams,” they said.
- Data: Improving how insurers upload and share data and promoting transparency to allow seamless movement between insurers.
- Product: Reassessing health insurance offerings and focussing on long-term affordability, especially for younger customers, whose premiums rise significantly over time.
- Conduct: Ensuring customers are supported throughout their insurance journey, not just at the point of sale.
They also mentioned that this year, the IA started the AI Co-op programme, in hopes of growing AI uptake among insurers in Hong Kong.
“We aim to balance development and supervision while promoting inclusivity. This initiative is designed to prepare a framework that facilitates the development of AI," Mr Cheung said.
The IAIS annual conference is set to take place in Hong Kong in mid-November 2026.