The Wang Fuk Court fire has left little mark on Hong Kong’s property insurance prices. It has changed how insurers underwrite, particularly when an old high-rise goes under scaffolding.
Underwriting profit for direct property damage business in Hong Kong fell 87% in 2025, largely because of heavy claims payouts and the reserves insurers set aside after the fire at the Tai Po housing estate in November 2025, according to a new AM Best market segment report.
The losses were cushioned by the reinsurance market. “A material portion of the gross incurred losses from the Wang Fuk Court fire was transferred to reinsurers, with limited impact on pricing,” said Stephanie Mi, senior financial analyst at AM Best. “However, the scale of the event has caused primary insurers and reinsurers to reassess their risk appetite and strategy, leading to stricter underwriting standards, particularly for high-rise renovations and high-risk construction locations.”
The fire killed 168 people and spread through seven of the estate’s eight towers, which were encased in bamboo scaffolding for renovation work. The building’s own fire policy claim remains unresolved, as IB reported, pending the findings of an independent investigation and the government’s buyout of the estate.
The broader market still grew. Hong Kong’s non-life gross written premiums rose 8% to HK$108.5 billion in 2025, driven by direct business and inward reinsurance, AM Best found. Property premiums grew solidly, as more frequent catastrophe events increased demand for commercial cover and insurers expanded their inward reinsurance portfolios.
Accident and health remained the largest line, at 37% of the market, and grew 14.5% despite pressure on margins from medical inflation. AM Best attributed the growth to strong onshore demand, an ageing population and Hong Kong’s role as a regional hub for private medical services and cross-border protection.
“The rapid physical integration of the Greater Bay Area, a major urban and economic cluster in southern China that connects Hong Kong and Macau with nine cities in Guangdong province, has also led to considerable non-local demand,” said Cynthia Ang, senior industry research analyst at AM Best.
Competition remains intense. Hong Kong had 87 authorised pure non-life insurers as of March 31, 2026, and no single company holds more than 10% of the market. AM Best said tight price competition and margin pressure are making organic growth difficult for some insurers. In employees’ compensation, favourable releases of prior-year reserves improved the segment’s combined ratio in 2025.
For brokers placing property and construction risks in Hong Kong, the fire’s legacy is showing up in underwriting more than in pricing. Owners’ corporations planning renovations, and contractors working on high-rise buildings, should expect closer scrutiny of scaffolding, materials and fire safety, and tighter terms.
