Hong Kong insurance covers only 16% of medical costs, warns regulator
Hong Kong's insurance regulator warns that insurance accounts for only about 16 per cent of the city's total medical spending, with government subsidies covering 51 per cent. As the population ages and medical inflation runs at 10 per cent annually, the official calls for more industry-government co
The Insurance Authority's chief executive, Clement Chang, has warned that Hong Kong's rapidly ageing society is placing growing strain on public finances. Speaking at the annual conference of the International Association of Insurance Supervisors, Mr Chang said that of the city's roughly seven million people, only about half have bought insurance, leaving the rest dependent on government care.
According to Mr Chang, insurance currently covers only about 16 per cent of Hong Kong's total medical spending, while government subsidies account for 51 per cent. Among those aged 65 or older, only one in five is protected by insurance. With medical inflation running at about 10 per cent a year, Mr Chang said the government would find it difficult to sustain the burden in the long term and called for greater efforts across all sectors.
The regulator said its supervisory philosophy is shifting from pure regulation towards 'synergy', seeking cooperation with various parties. As an example, he cited support for insurers offering annuity plans that would allow Hong Kong residents to choose to retire in mainland China. This would require cross-boundary coordination on welfare payment systems, interconnection of medical records, and arrangements for cross-border non-emergency ambulance services to ensure timely return to Hong Kong for medical treatment.
On climate issues, Mr Chang said the Insurance Authority has proactively approached academia to launch a first-stage climate modelling project. The aim is to use academic expertise to improve data quality and help the industry develop parametric insurance products that carry low basis risk, are affordable and easy for the public to understand.