Year 2019 - A NEW ERA FOR INSURANCE TAX DEDUCTION 保險扣稅展新里

In view of the functions of insurance, both government and public are suggested to promote the value of insurance and transfer different type of risks earlier. Loss Frequency and Severity "A typhoon triggering a No. 8 signal on Hong Kong’s warning scale can carry huge total losses to the city – about US$627 million a day, according to a report by Swiss Re Institute. That is about 67 per cent of the city’s daily GDP, the research arm of the insurer said. And many of the losses are not insured." Source: SCMP 13 September 2018 Number of world natural catastrophes, 1980-2017 (Number of relevant events by peril) Source: © 2018 Munich Re, Geo Risks Research, NatCatSERVICE. As of January 2018. As per the above information, we believe that the growth of loss frequency and severity will cause serious financial impact to the society in the coming years. Therefore, the appropriate risk transfer mechanism and funding system are necessary to mitigate the risk impact. Both public and government should contribute in the risk management to ensure economic survive and development. Risk Management Education and Encouragement of Risk Transfer With consider the value and benefit of insurance, the risk transfer concept should be included in our public education and we have to ensure everyone understand the importance of risk transfer in different type of risks. MPF and VHIS are the good examples for the risk transfer in Hong Kong with government support. "As announced in the 2018-19 Budget, to provide an incentive for the public to purchase certified plans under the VHIS, the Government will amend the law to allow tax deduction for relevant premiums paid. Premiums paid by a person for himself/herself and their dependents will be allowed for deduction. The deduction ceiling is $8,000 per insured person per year. There is no cap on the number of dependents that are eligible for tax deduction." Source: www.info.gov.hk nu _w rld_n t_cats_80-17.gif [21] rce: © 2018 Munich Re, Geo Risks e earch, N tCatSERVICE. As of January 2018. View Archived Graphs [22] World weather-related natural catastrophes by overall and insured losses, 1980-2017 35