The bill also introduces an obligation for all licensed insurance intermediaries to act “in the best interests of policyholders” (Article 89). During the consultation process, it was pointed out that insurance agents in Hong Kong are liable to insurers and not to policyholders. The Legislative Council letter raised this concern as follows: “In order to allay insurance agents` concerns about a possible conflict of loyalty to the insurer and the customer, it is stipulated that any clause of agreement between the insurer and its representative that violates the legal obligation of “Best Interest” is unenforceable” (Article 68A, paragraph 1). If this provision of the law is enshrined as it is in the law, it would be a departure from existing legislation, would go beyond the requirement in other jurisdictions for agents to act fairly towards their clients, and should be taken into account when developing agency contracts. Appendix E of the Act indicates that there are currently 150 officers in the Office of the Insurance Commissioner (OIC), including the Insurance Commissioner, 48 Insurance Officers (IMO), 22 General Officers and 79 Public Service Officers (NCSC). It is proposed that, in order to achieve the desired institutional independence and operational flexibility, AI should recruit its own staff, by hiring current OIC staff, converting them to other divisions or otherwise implementing them (some OIC staff are expected to apply for IIA roles). Ai is likely to have more than 50% more staff than the OIC currently (approximately 240 employees). This increase is partly due to the fact that AI will assume the regulatory tasks of HKFI, CIB and GDPA. The bill contains three-year transitional provisions, such as the transition of licences and regulations from self-regulatory organizations to ii is applied in practice – but most of the details of the transitional provisions have been left to a working group that is expected to develop. We have been following the evolution of this legislation in recent years. There is no doubt that AI could strengthen the regulation of the insurance sector in Hong Kong and have an impact on the structure of the Hong Kong insurance market, particularly if the risk-based capital mentioned in the Legislative Council is introduced by the new I2II, which could trigger a wave of consolidation.