First insurance-linked securities for sidecars issued in Hong Kong.

The Financial Services and the Treasury Bureau of the Hong Kong SAR Government today welcomed the first "sidecar" insurance-linked securities issuance in Hong Kong by PICC Property and Casualty Company Limited, with a total issuance size of US$12 million, equivalent to approximately HK$94 million, providing coverage for the Mainland's offshore wind power insurance business through proportional reinsurance. Secretary for Financial Services and the Treasury Christopher Hui said that the National 15th Five-Year Plan has made improving the catastrophe risk protection system and risk-sharing mechanisms a key priority, and Hong Kong's first five-year plan therefore proposes to fully leverage the comparative advantages of international insurance, reinsurance and capital markets to promote the coordinated development of traditional insurance and non-traditional risk management tools. This can harness the synergistic effects of multi-tiered risk transfer and sharing mechanisms such as insurance-linked securities, thereby consolidating Hong Kong's strategic function as a regional and even global hub for catastrophe and specialised risk management. This issuance marks important progress, with national support, in Hong Kong's insurance industry and capital markets in risk transfer and alternative capital deployment, while further enhancing the market's capacity to address catastrophes and other specialised risks and consolidating Hong Kong's position as an international risk management centre.