Regulator Steps In To Take Over Cab Insurer

The Insurance Authority said on Friday that it has appointed accountancy firm Deloitte to take control of Target Insurance, a listed firm that owns around 60 percent of policies in the local taxi market.

The regulator said four other insurance companies have been asked to consider providing substitution policies for affected policy holders.

The regulator said the move is intended to maintain market stability and protect the interests of policy holders.

It said Target Insurance sent letters to around eight thousand taxi owners late last week, informing them that it was cancelling their policies in a week's time.

The authority's CEO, Clement Cheung, said an investigation is underway to find out if Target Insurance had broken the law.

"Through the performance of regulatory actions and collecting market intelligence, we have reasons to believe that certain investment activities and asset allocation made by Target might have contravened statutory requirements under the Insurance Ordinance," Cheung told a press conference.

"There’ve also been deficiencies in corporate governance that have yet to be redressed."