Comparison of Mandatory Property Insurance in HK

Published on October 31, 2025 and written by Cyril Jarnias

Mandatory Insurance in Hong Kong: An Imperative for Real Estate Investors

Within Hong Kong’s unique real estate market, where skyscrapers frame a dense and competitive skyline, understanding mandatory insurance is crucial for every investor or property owner.

Essential Policies to Protect Your Assets

This comparison highlights the nuances of different essential policies, from home insurance to legal coverage, and reveals how these indispensable measures can protect your assets while optimizing your investment.

A Strategic Necessity

As the city positions itself among the world’s most expensive real estate markets, obtaining the right insurance doesn’t just prevent unforeseen events—it becomes a strategic imperative for anyone aspiring to successfully navigate this urban maze.

Comparison of Home Insurance in Hong Kong

Overview of Home Insurance in Hong Kong

The Hong Kong market offers diverse home insurance options tailored to the needs of a dense urban environment exposed to specific natural risks like typhoons and floods. Key players include QBE Hongkong & Shanghai Insurance Limited, Prudential General Insurance Hong Kong Limited, Sompo Insurance (Hong Kong) Co. Ltd., AXA, and AIG Insurance Hong Kong Limited.

Mandatory Requirements Under Local Legislation

• Home insurance is not legally mandatory for private owners but may be required by banks for mortgage loans.
• Condominiums often require minimum coverage for common areas.
• Some policies include Liability coverage (damage caused to others).

Comparison of Main Offers

Company	Main Coverage	Estimated Cost (per year)	Additional Services	Features/Advantages	Ratings/Customer Feedback
QBE	Personal property, Liability up to 10M HKD, loss of rent	≈ 800-2,500 HKD	24/7 assistance, e-claims, certified contractors	Coverage for buildings up to 50 years old, e-claims, panel of approved contractors	Satisfied with quick processing and digital service
AXA	Property, Liability, water/fire damage, theft	≈ 900-3,000 HKD	Valuables protection, natural disaster extensions	Extensive network, customizable options	Good reputation, but claims processing sometimes considered slow
AIG	Property, Liability, natural disaster extensions	≈ 1,200-3,500 HKD	Emergency assistance, temporary relocation coverage	Quick response to claims, extensive coverage	Positive feedback on disaster management
Prudential	Standard + valuables options, Liability, glass breakage	≈ 1,000-2,800 HKD	Relocation assistance, precious items protection	Modularity, “all-risk” insurance possible	Good reputation, but prices slightly above average
Sompo	Personal property, Liability, domestic damage	≈ 900-2,500 HKD	Multilingual customer service, 24/7 assistance	Expat-friendly, simple management	Appreciated for customer support

List of Main Additional Services Offered

• 24/7 Assistance (plumbing, electrical, locksmith emergencies)
• Natural Disaster Protection (typhoon, flood, landslide)
• High Liability Coverage
• Digital Service (e-claims) for quick claims management
• Network of Approved Contractors for repairs without upfront costs

Usage Examples

• Water damage from a typhoon: insurance covers repairs, temporary relocation, and compensation for damaged property.
• Fire in a dense building: Liability coverage covers damage to neighbors, loss of rent is compensated during repairs.
• Burglary with theft of valuables: compensation for stolen items and coverage for lock replacement.

Importance of Choosing Suitable Insurance in Hong Kong

In a dense urban context, risks of claim propagation (fire, water damage) and evacuations are heightened. Comprehensive home insurance not only protects property but also against disputes with neighbors and financial losses related to property uninhabitability.

Customer Reviews and Public Ratings

• Recognized companies like QBE, AXA, and AIG are appreciated for their quick claims processing and clear offers.
• Customers value digital solutions and 24/7 assistance availability.
• Some criticize certain providers for lack of flexibility or extended processing times during major disasters.

Key Takeaway:

Thoroughly comparing natural disaster coverage, assistance quality, and claims management is essential for choosing home insurance suited to Hong Kong’s reality.

Liability Insurance: A Necessity for Property Owners

Liability insurance is considered essential for property owners in Hong Kong due to the high financial and legal risks associated with property ownership in a dense, vertical urban environment where incidents can quickly affect multiple parties.

Financial and Legal Risks Without Coverage:

• Without liability insurance, the owner must personally bear all costs related to damages caused to others (tenants, neighbors, passersby) by their property. These costs may include:
• Material repairs (water damage extending to a neighbor’s property).
• Medical expenses or compensation for injuries.
• Attorney fees and legal costs in case of prolonged disputes.
• Financial liability can reach several hundred thousand or even millions of HKD depending on the severity of the incident.

Concrete Examples Where Liability Insurance is Crucial:

• A water leak from the owner’s apartment damages the ceiling or property of the neighbor below.
• An electrical fault causes a fire affecting multiple residences.
• An accidental fall in common areas due to maintenance negligence attributable to the landlord.

Situation	Consequence Without Insurance	Protection With Liability Coverage
Water damage to neighbor’s property	Full repair costs borne by owner	Covered by insurer
Tenant injury	Direct compensation	Legal/financial coverage
Fire originating from rented property	Risk of personal bankruptcy	Loss limitation

Regulatory Comparison:

Country/Region	Owner Liability Insurance	Mandatory Status
Hong Kong	Strongly recommended	Not legally mandatory
France	Mandatory for non-occupant owners*	Yes (condominiums)
Portugal	Mandatory for certain rental programs	Yes

*Non-occupant owner

In many comparable European countries, the law mandates liability insurance at least for certain types of property owners (particularly those not residing on the premises). In Hong Kong, even if not generally imposed by law outside actively managed condominiums, it remains essential given the risks multiplied by urban density.

Implications During Disputes or Claims Without Protection:

• The owner faces having to finance all repairs or compensation claimed by a victim alone.
• In case of lengthy or complex legal proceedings: frequent inability for an average individual to bear all associated costs.
• Increased risk of real estate assets being seized or even liquidated to compensate a victim if no funds have been allocated through dedicated insurance.

In summary, obtaining liability insurance enables Hong Kong property owners to:

- Protect their assets against potentially catastrophic financial consequences;
- Secure their relationships with tenants and neighbors;
- Benefit from indispensable legal and financial support during major incidents in this urban context highly exposed to cross-risks among residents.

Understanding Rental Risk Coverage

Rental risks refer to all incidents that may affect a rented property, such as material damage (fire, explosion, water damage) or financial losses related to the inability to rent the property. Covering these risks is crucial to protect the owner’s assets and ensure continuous enjoyment for the tenant in case of an incident.

Main Rental Risks Commonly Insured in Hong Kong:

• Material damage (fire, explosion, water damage)
• Loss of rent following an incident making the property uninhabitable
• Liability towards third parties and neighbors
• Theft or vandalism
• Specific risks related to technical installations (e.g., high-pressure gas)

Legal Obligations of Landlords and Tenants in Hong Kong:

Party	Main Obligation	Examples/Comments
Landlord	Not legally required to systematically insure against rental risks	May contractually require the tenant to obtain insurance
Tenant	No general legal obligation unless specified in lease	Leases often include liability insurance requirements
All	Compliance with Landlord and Tenant (Consolidation) Ordinance for certain older residential properties	Increased control over technical safety in specific cases

Local regulatory example:
For installations with particular risks (e.g., high-pressure gas), strict regulations exist on quantitative risk assessment to ensure it remains within “acceptable” thresholds defined by Hong Kong law. Any company operating such installations must prove it has taken all reasonable and economical measures to reduce these risks.

Comparison of Main Policies Available in the Hong Kong Market:

Policy	Advantages	Limitations
Property All Risks	Broad accidental/material damage coverage	Frequent exclusions; high deductibles
Loss of Rent Insurance	Quick compensation after major incidents	Limited compensation period
Liability Insurance	Legal protection against third-party/neighbor claims	Doesn’t always cover all types of third-party damages

Practical Tips for Choosing Rental Risk Insurance:

• Precisely analyze the nature of the rented property: commercial vs. residential use.
• Verify specific contractual requirements in the lease, particularly if a specific policy is required by the landlord.
• Consider the property’s actual value and its fittings to avoid underinsurance.
• Carefully compare deductibles, exclusions, and compensation limits between insurers.
• Ensure the chosen insurance complies with all obligations imposed by local regulations, especially if your property falls under a special regulated category.

Optimal coverage involves balancing comprehensive protection against all major incident types expected in Hong Kong with strict compliance with contractual and legal requirements applicable to the specific rental type concerned.