Shares in China Taiping Insurance Holdings (0966) dropped as much as 8 percent on Thursday on concerns about its potential liability exposure to a Hong Kong apartment complex where a huge fire has killed at least 55 people and left nearly 300 unaccounted for.
According to publicly available minutes of meetings of registered owners of Wang Fuk Court, members approved the continuation of insurance coverage for the housing complex with China Taiping Insurance (Hong Kong) in December 2024.
The policy period runs from January 1, 2025, to December 31, 2026, the records show. As part of the policy, the insurer has a liability of up to HK$2 billion in compensation to be paid for the complex's exterior and public area.
China Taiping Insurance (Hong Kong) also provided insurance coverage for the ongoing renovation project to the contractor, Prestige Construction and Engineering Company, according to a separate and publicly available project-briefing document.
The policy covers "all risks" for the contractor with a total of HK$365 million in compensation, as well as "employees' compensation" of up to HK$200 million per event. It is valid from July 2024 to July 2027, the document showed.
China Taiping Insurance Holdings and its unit China Taiping Insurance (Hong Kong) did not immediately respond to Reuters requests for comment.
The tightly packed complex in the northern Tai Po district in Hong Kong has 2,000 apartments in eight blocks that are home to more than 4,600 people in a city struggling with chronic shortages of affordable housing.
The fire may have been caused by a "grossly negligent" construction firm using unsafe materials, police said on Thursday.
Police officers searched the housing estate's building maintenance company on Thursday morning, seizing documents that mentioned Wang Fuk Court, local media reported. The company did not immediately respond to a request for comment.
China Taiping Insurance shares on Thursday dropped as much as 8.1 percent to their lowest level since October 24. The stock trimmed losses later, falling 1 percent at 0628 GMT, lagging a 0.35 percent gain in the benchmark Hang Seng Index.
State-owned China Taiping provides a host of general insurance services - from marine hull to property insurance.
Reuters
