Professional indemnity insurance
27C.—(1)  For the purposes of section 35Y(1)(c) of the Act, the limit of indemnity to be covered under a professional indemnity insurance policy for an applicant who intends to be registered as a direct general insurance broker, a general reinsurance broker or a life reinsurance broker shall be an amount of not less than $1 million, under which the deductible allowed shall be —
(a)where the applicant is in its first financial year of operation, not more than 20% of the paid-up capital; and
(b)in any other case, not more than 20% of the applicant’s net asset value as at the end of its preceding financial year.
(2)  Where the applicant intends to be registered as an insurance broker in respect of more than one type of insurance broking business, the limit of indemnity to be covered under a professional indemnity policy shall be not less than the aggregate of the amounts of the limit of indemnity specified in paragraph (1) for each of those businesses, under which the deductible allowed shall be —
(a)where the applicant is in its first financial year of operation, not more than 20% of the paid-up capital; and
(b)in any other case, not more than 20% of the applicant’s net asset value as at the end of its preceding financial year.
(3)  A registered insurance broker shall have in force at all times a professional indemnity insurance policy —
(a)under which the limit of indemnity covered is an amount not less than the minimum limit of indemnity applicable to it by virtue of paragraph (1) or (2), as the case may be; and
(b)under which the deductible allowed is —
(i)where the registered insurance broker is in its first financial year of operation, not more than 20% of the paid-up capital; and
(ii)in any other case, not more than 20% of the registered insurance broker’s net asset value as at the end of its preceding financial year.