BEIJING: Hong Kong-listed shares of major insurers, led by Prudential and AIA Group, fell sharply on Thursday (Aug 6) after Caixin reported China's mainland tax authorities are levying taxes on insurance policy income earned offshore. Beijing and Hangzhou authorities have started to apply personal income tax rates of 20 per cent on returns from Hong Kong insurance policies, including dividend payouts and interest earned on prepaid premiums, Caixin reported on Wednesday. Hong Kong insurance has long been a channel for Chinese investors buying assets abroad, with the policies providing more protection than what is available on the mainland, and related savings and investment products mostly denominated in dollars. A drop in domestic bond yields dragged down onshore insurance returns, which further fuelled demand for offshore products in recent years. Chinese insurers Ping An Insurance and China Life Insurance were down more than 1 per cent as both firms have a sizeable offshore business with Hong Kong assets.