China Taiping Insurance Faces Crisis After Hong Kong Fire Tragedy

Shares in China Taiping Insurance plunged over liability concerns linked to a Hong Kong apartment fire that killed 55 people. The insurer might face significant financial exposure due to policies covering the affected complex. Police are investigating the cause, suspecting negligence by a construction firm.

Shares of China Taiping Insurance Holdings saw a steep decline of up to 8% on Thursday following fears of potential liability linked to a devastating fire at a Hong Kong apartment complex. The tragic incident claimed the lives of at least 55 people and left nearly 300 missing.

Documents reveal that China Taiping provided insurance coverage for Wang Fuk Court, where the blaze occurred. The insurance includes a liability of up to HK$2 billion in compensation, suggesting significant financial exposure for the insurer. The complex's insurance policy runs from January 2025 to the end of 2026, with additional coverage for renovations provided to the contractor, Prestige Construction and Engineering Co.

As investigations continue, authorities suspect that a 'grossly negligent' construction firm may have used unsafe materials, contributing to the fire. Police are probing the involved parties while China Taiping's stock struggled amidst market concerns. This incident shines a light on broader issues of affordable housing and safety standards in Hong Kong.

(With inputs from agencies.)