Press Release LCQ20: Insurance Claims Complaints Bureau Wednesday, March 1, 2000 Following is a question by the Hon Cheung Man-kwong and a written reply by the Secretary for Financial Services, Mr Rafael Hui, in the Legislative Council today (Wednesday): Question In November last year, an insurance company which was dissatisfied with the adjudication of the Insurance Claims Complaints Bureau on an insurance policy's compensation claim, applied to the High Court for judicial review and won the case. In this connection, will the Government inform this Council whether: (a) it knows the criteria adopted by the Bureau for determining if a complaint lodged by an insurance policyholder is substantiated; whether such criteria have spelt out if the literal interpretation of the terms in a policy or the judgement made by common sense should prevail in the event of discrepancy between the two; whether the Bureau has amended such criteria in the light of the court's ruling; if it has, of the details; (b) it knows if the Bureau has plans to amend its rules and regulations or adopt other measures to prevent insurance companies from overturning, by means of judicial review, the Bureau's adjudication on insurance compensation claims made against them; (c) the Bureau is an organization exercising public functions under the auspices of the Government; and (d) the Administration will conduct a review on the operations and structure of the Bureau to ensure that the interests of insurance policyholders are duly protected? Reply Madam President, (a) The Insurance Claims Complaints Bureau (ICCB), is set up as a company limited by guarantee with the objective, inter alia, of receiving complaints relating to claims made in connection with or arising out of personal insurance contracts with any members and to facilitate the satisfaction, settlement or withdrawal of such complaints disputes or claims whether by the making of awards or by such other means as shall seem expedient. The Administration has been informed that the ICCB, in adjudicating claims disputes between a policy holder and the insurer concerned, the Bureau will consider the relevant policy, general principles of good insurance practices, any applicable rule of law or judicial authority, and any codes and guidelines issued from time to time by the Hong Kong Federation of Insurers or the ICCB. At present, where there is inconsistency between the interpretation of the terms of the insurance contract and the general principles of good insurance practices, the Bureau would take a view on which one should prevail. ICCB is now reviewing the matter with a view to amending its Articles of Association to specify clearly that in adjudicating complaint cases where there is any such inconsistency, the general principles of good insurance practices shall prevail. (b) We have gathered that the ICCB seeks to spell out clearly in its Articles of Association that decisions of ICCB shall be final and binding on its members. The ICCB considers that such changes should be able to reduce the chance for its members to take the bureau's adjudication on insurance compensation claims made against them to the Court for judicial review. (c) As explained in the reply to question (a) above, ICCB is a company set up by the insurance industry voluntarily to assist policy holders in resolving their claims disputes with insurers in respect of their personal insurance policies. According to the judgement of the court case mentioned by the Hon Cheung Man-kwong, the judge considers that the Bureau 'has at all material times carried out a public function of conciliation and arbitration'. The ICCB is however not an organization under the regulation of the Government. (d) The effective operation of the self-regulatory system of the insurance industry is vital to the protection of policy holders' interests, and that ICCB is an important part of this self-regulatory system. Hence, the Government attaches much importance to the operation of the ICCB. We will closely monitor and review the operations of the ICCB after it has amended its Article of Association and enhanced the transparency of its operation, to ensure that the policy holders' interests are duly protected.
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