10Life Open Enquiry to the Insurance Authority and the Hong Kong Monetary Authority

Elderly and retired customers of limited means are being placed into large, non-guaranteed savings policies funded by bank loans, on terms they do not fully understand and cannot sustain. The cases we see are not isolated. On 23 July 2026 we wrote separately to the Insurance Authority (IA) and the Hong Kong Monetary Authority (HKMA), asking each to answer publicly within 30 days. Both letters, and any reply, are published on this page.

10Life Financial Limited is a licensed insurance broker that also operates an independent insurance comparison platform. We help the public identify their real protection needs and compare products against them. We raise this enquiry in that independent capacity, from what we observe in the market. 

Instead of paying the full premium, the customer borrows most of it from a bank and pays the loan interest, usually at a floating rate. The policy is pledged to the bank as security. If the policy is surrendered, its cash value must first repay the loan. 

Two products, one sales pitch. A premium-financed policy is two contracts: an insurance policy and a bank loan. It is sold as a single opportunity, on the appeal of high projected returns. But the projection is not the outcome. What the customer actually receives depends on non-guaranteed dividends, floating loan rates, when the policy is surrendered or the death occurs, and whether the bank calls the loan early. The only certainty is that the interest must be paid.

Two products nobody adds up. The illustration ignores the loan. The loan terms ignore the cost of surrendering early. The needs analysis puts the protection gap in one section and the loan in another. Nothing requires them to be netted, so the customer never sees the real position: on death the loan is repaid first, and the family receives a fraction of the sum assured.

One seller on both sides. The bank sells the policy as the insurer’s agent and lends the money as the lender. It is remunerated on both, and both grow with the size of the loan. It also runs the affordability check that would limit that loan. Nobody in the arrangement acts for the customer. 

To the Insurance Authority:

• How can an insurer spot an overstated declaration when the overstatement itself disables the check?
• Should a loan-funded policy be presented to a customer as closing a protection gap at all?
• Will the full cost over the life of the arrangement be calculated and shown to the customer?

To the HKMA:

• Bank staff bundling the loan with the policy, selling it on projected returns, and leaving the rate and surrender risks unexplained is market conduct the regulator has already identified. What consequence follows for the bank?
• Will verified income and assets be required in every case, rather than left to the intermediary arranging the loan?
• Should customers be shown, and tested against, what their repayment becomes if rates rise? 

Premium financing is a legitimate arrangement and can suit customers with the means and the understanding to carry it. Our concern is who it is being sold to, and how.

These letters raise systemic questions. They do not concern any individual case, institution or practitioner. We raise them constructively, in the belief that clear public answers would strengthen confidence in the insurance and banking sectors, and so that people buy only the protection they genuinely need and can afford. 

Both open letters are available below in English and Chinese. In the event of any discrepancy, the English version prevails. We will publish the regulators’ replies here as soon as they are received. 

Open Enquiry to IA (EN) 
Open Enquiry to IA (TC)
Open Enquiry to HKMA (EN)
Open Enquiry to HKMA (TC)