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A BRIEF HISTORY OF M.I.B.
   
 
   
 
  1951 to 1980
   
  Since 1951, all users of motor vehicles have been required, under the Motor Vehicles Insurance (Third Party Risks) Ordinance Cap. 272, to be insured against any liability which may be incurred in respect of the death of or bodily injury to any person caused by or arising out of the use of a motor vehicle on a road in Hong Kong.

With the rapid increase of motor vehicle ownership in Hong Kong, cases arose where the victim was unable to obtain compensation to which he was entitled because the vehicle was uninsured, or the vehicle or driver was untraceable, or there had been some material breach of insurance policy conditions by the driver or the policyholder. This clearly frustrated the intentions of the Ordinance.

The insurance industry recognised that something should be done in order to ensure that bodily injury victims of road accidents with legally enforceable claims should obtain the damages due to them. In early 1978, the Accident Insurance Association of Hong Kong started work on the formation of an organisation similar to the Motor Insurers' Bureau existing in some parts of the British Commonwealth, but adapted to suit Hong Kong. Proposals were submitted to the Government and discussions were held. By late 1979, the scheme was taking a clear shape as principles and logistics were agreed upon. On 27th June 1980, motor insurers jointly entered into a 'Principal Agreement' with the Government, agreeing to establish the Motor Insurers' Bureau of Hong Kong ("M.I.B.") within six months. This led to the incorporation of M.I.B. in December 1980, and the signing of the First Fund Agreement in February 1981, which enabled M.I.B. to carry out its objectives.
   
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  Formation of M.I.B
   
  M.I.B. was formed as a non profit making company limited by guarantee, with Government approval to be registered with limited liability without the addition of the word "limited" to its name. The incorporation was completed on 10th December 1980.

All insurance companies and Lloyd's Underwriters authorised by law to carry on motor vehicle insurance business in Hong Kong must become members of M.I.B..
   
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  The M.I.B. Council
   
  The affairs of M.I.B. are managed by a Council consisting of between seven to eleven Councillors elected from the registered representatives of the membership. The Council meets regularly to discuss and take action on all matters involving M.I.B..
   
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  The First Fund Agreement dated 1st February 1981 between M.I.B. and the Government
   
  This agreement makes the Bureau liable for the settlement of all claims for damages for bodily injury or death, if the claim is not settled within 28 days of judgment being given, arising out of any accident involving the use of a motor vehicle on the road. The agreement specifically excludes liability by the Bureau for judgments that remain unsettled because of the insolvency of an insurer.

The First Fund was gradually built up by a 1% levy on all motor policy premiums. For years 1986 to 1994, this levy was changed to 0.5% and then back to 1% from 1995. The levy of 1% was suspended from 1st January 2001, but has been reinstated on 1st January 2004. The levy was revised to 2% on 1st October 2005 and further adjusted to 3% on 1st January, 2008. The levy was reduced to 0% on 1st April, 2011 and adjusted to 1% from 1st July, 2012.

Whilst these changes were deemed necessary for the Fund, at the same time, the Insolvency Fund levy was proportionately adjusted so as to maintain an unaltered total levy from vehicle owners.
   
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  The Domestic Agreement dated 1st February 1981 between M.I.B. and authorised Motor Insurers
   
  By this agreement, motor insurers committed themselves to joining M.I.B., and to contributing such funds as may be required by M.I.B. to meet its objectives.

They also agreed to abide by the 'Insurer Concerned Principle' which provides that they will still satisfy claims for bodily injury or death out of their own funds even in cases where there has been a breach of the insurance policy conditions.

The Government makes it a condition that any company seeking authorisation as a motor insurer must be a member of M.I.B., and must be bound by this agreement.
   
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  The Insolvency Fund Agreement dated 1st November 1985 between M.I.B. and the Government
   
  Before the coming into effect of the Insurance Companies Ordinance (Cap. 41) in 1983, regulating of insurers in Hong Kong was relatively unsophisticated and policyholders were not very well protected. Recognising that this was an issue to be addressed, Government took action and passed the Ordinance in 1983 which placed much greater duties on insurers to conduct their business properly. Soon afterwards, five motor insurers were placed under liquidation and left claims from traffic accident victims unsatisfied. The Government then deployed funds to finalise these claims.

Whilst those insolvencies were being dealt with by the Government, M.I.B. looked ahead and decided that in order to uphold the principle that the victim should not suffer the consequences of an empty judgment, a second fund to meet claims left unsettled by insolvent insurers should be established. M.I.B. then took action to set up the Insolvency Fund which was achieved by the signing on 1st November 1985 of the Insolvency Fund Agreement with Government which required M.I.B. to satisfy judgments left outstanding by motor insurers which went into insolvency after that date.

The Insolvency Fund was gradually built up by a 2.5% levy on all motor policy premiums. From 1995, this levy was changed to 2% and revised to 1% on 1st October 2005. The levy was suspended from 1st January 2008 but reinstated to 3% from 1st April, 2011 and further adjusted to 2% from 1st July, 2012.

Whilst these changes were deemed necessary for the Fund, at the same time, the First Fund levy was proportionately adjusted so as to maintain an unaltered total levy from vehicle owners.
   
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  The Domestic Agreement dated 1st November 1985 between M.I.B. and authorised Motor Insurers
   
  By this agreement, motor insurers are obliged to observe the Insolvency Fund Agreement as if they have been parties thereto.
   
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  The M.I.B. Undertaking dated 29th June 1995 given by M.I.B. to the Government
   
  Under English Common Law, death or bodily injury victims may claim against the wrongdoer for damages which can be unlimited in theory. For many years, motor insurers in Hong Kong have been providing unlimited cover on third party risks. This was achieved with the help of the reinsurance industry which have provided unlimited reinsurance protection to the insurers. By 1994, reinsurers felt that unlimited reinsurance could no longer continue and gave notification to insurers that unlimited reinsurance would be discontinued in 1995. This necessitated some changes in Hong Kong law to allow motor policies to carry a limit on third party risks. After discussions among the Government, insurers and reinsurers, it was finally agreed that as from mid 1995, the Motor Vehicles Insurance (Third Party Risks) Ordinance Cap. 272 would be amended to admit motor insurance policies covering at least HK$100 million per event on third party risks.

In the event of an award exceeding the limit stated on a policy, M.I.B. concluded that it was beneficial to all concerned that M.I.B. should take up a new obligation of being the "insurer of last resort" in order to uphold the principle that the victim should not suffer the consequences of an empty judgment. Accordingly, M.I.B. provided an undertaking dated 29th June 1995 to the Government to enhance the First Fund Agreement to the effect that if the judgment debtor shall be unable to pay the uninsured portion of a judgment exceeding the policy cover, M.I.B. will effect payment.
   
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  The Domestic Memorandum dated 29th June 1995 between M.I.B. and authorised Motor Insurers
   
  By this memorandum, motor insurers consented with the M.I.B. Undertaking dated 29th June 1995.
   
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  The Supplemental Memorandum of Agreement dated 24th June 2002 between M.I.B. and the Government
   
  M.I.B. has undertaken with the Government to make available with effect from 1st January 2002 a limited facility of up to HK$200 million in the aggregate to be funded from out of the First Fund Scheme to satisfy the claims of third parties who have suffered death or bodily injury caused by a terrorist act through the use of a motor vehicle on a road in Hong Kong. The limited facility provides cover on a first come first served (by notification of court judgments) basis. M.I.B. waives any rights to which it would be entitled under the Domestic Agreement to recover from any insurer concerned any sums paid where the judgment is given in respect of death or bodily injury liability which arises out of a terrorist act.
   
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  The Supplemental Domestic Deed between M.I.B. and the authorised Motor Insurers
   
  Motor insurers have agreed to enter into this Supplemental Domestic Deed which has effect as from 1st January 2002 to supplement the provisions of the Domestic Agreement as regards the limited facility undertaken with the Government.
   
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  The Deed of Undertaking for new members of M.I.B.
   
  All members are obliged to observe the domestic agreements, and those insurers who were signatories under the original domestic agreements would of course have bound themselves by being signatories. New members are required, when applying for membership of M.I.B., to provide a Deed of Undertaking to confirm their compliance with the domestic agreements.
   
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  The Supplemental Domestic Deed between M.I.B. and the authorised Motor Insurers (13th August, 2009)
   
  Motor insurers have agreed to enter into this Supplemental Domestic Deed which has effect as from 1st January 2009 to supplement the provisions of the Domestic Agreement as regards the undertaking with the Government to satisfy claims of third parties suffering property damage (TPPD) caused by or arising out of the use of a motor vehicle in Hong Kong where the TPPD policy is ineffective because of the inability of an Insurer to pay its debts by reason of insolvency. Please refer to the Supplemental Domestic Deed attached under "Agreement" section of this site for details.
   
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Memorandum & Articles of Association

The First Fund
- Agreement (1 Feb,1981)
- Undertaking (29 Jun,1995)
- Supplemental Agreement (24 Jun,2002)

Domestic Agreement for the First Fund
- Agreement (1 Feb,1981)
- Memorandum (29 Jun,1995)
- Supplemental Deed (24 Jun, 2002)

The Insolvency Fund
- Agreement (13 Aug, 2009)

Domestic Agreement for the Insolvency Fund
- Agreement (1 Nov, 1985)
- Supplemental Deed (13 Aug,2009)

Deed of Undertaking for New Members
財務報表

2018 周年報表
2017 周年報表
2016 周年報表
2015 周年報表
2014 周年報表
2013 周年報表
2012 周年報表
統計資料

Claims Incurred
Types of Claims Incurred
Sizes of Claims Incurred
Frequency of Claims Incurred


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