“This is a strong indication of Hong Kong’s re-emergence as an international financial centre in the post-pandemic era,” Edward Moncreiffe, CEO for Hong Kong and Macau at HSBC Life, said in an interview.
The company, which sold HK$29.9 billion (US$3.8 billion) worth of new policies, or a fifth of the industry aggregate, in the first nine months of this year, has the biggest market share among insurers in Hong Kong.
Hong Kong-based customers accounted for 60 per cent of its sales, with overseas customers comprising the rest. Among its overseas clients, about 70 per cent were travellers from mainland China, with customers from 46 different markets contributing the remaining 30 per cent.
Of these, the top six sources of customers were Canada, Australia, Malaysia, Philippines, Singapore and Taiwan, with each contributing more than HK$100 million in new business premiums.
Insurance policies issued in Hong Kong often have more comprehensive coverage and at times offer guaranteed returns, features that overseas customers are not always able to find in their home markets, Moncreiffe said.
“With more international arrivals coming to Hong Kong over the nine months of this year after the border reopened in January, we see continued growth in demand for our wealth and health solutions from travellers from many different jurisdictions,” he said.
The Hong Kong government’s promotional efforts, such as those made by Chief Executive John Lee Ka-chiu, which included roadshows in Southeast Asia and other overseas markets, have created greater awareness about Hong Kong’s insurance industry globally, Moncreiffe said.
In December last year, Lee issued a road map and vowed to introduce policies to convince international insurance companies to set up regional hubs in Hong Kong.
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HSBC Life’s new centre in Macau targets Greater Bay Area clients
“We remain positive that this strong momentum will prevail for the rest of the year and 2024, supported by excess savings activity, higher demand for protection and the resurgence of the attractiveness of Hong Kong as an international financial centre.”
In the January-to-September period, sales of policies to mainland Chinese customers surged to HK$46.8 billion, or 32 per cent of the total, compared with HK$1 billion a year earlier, according to data the Insurance Authority released on Thursday.
Overall, new life insurance sales rose 30.6 per cent in the first nine months to HK$146.5 billion, from HK$112.2 billion a year earlier. This was also 4.8 per cent higher than sales of HK$139.8 billion recorded in the first nine months of 2019.
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HSBC Life’s US$20 million tech investment cuts claims payment time to 5 minutes
About 23 million travellers visited Hong Kong in the first nine months, including 18.7 million from mainland China, according to data from the Hong Kong Tourism Board. This is almost 100 times more than a year earlier, when travel was brought to a standstill during the Covid-19 pandemic.
Hong Kong’s insurance companies have traditionally attracted many overseas customers, according to the Hong Kong Federation of Insurers (HKFI) CEO, Selina Lau Pui-ling. The federation is an industry body representing 138 insurance companies in the city.
“In general, we have seen many overseas customers interested in buying high-end medical products in Hong Kong, such as the CEO medical plan, given that the premium rate is relatively attractive and we have different medical plans to choose from,” Lau said.
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Hong Kong ‘excellent hub’ for international insurers to expand
The trend might be related to the fact that many insurance companies and insurance brokers are also promoting Hong Kong’s insurance products and wealth-management solutions to overseas customers.
Hong Kong’s leading insurers, including HSBC Life, Manulife, Standard Chartered Bank, Prudential and Sun Life have all expanded luxury customer centres where agents and brokers meet wealthy customers to pitch insurance and wealth-management products.
“We can see that foreigners are buying financial assets in Hong Kong to diversify their risks,” Lau said.
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Compared with other countries, especially developing ones, insurance products in Hong Kong are more comprehensive, which is why foreign customers like to buy policies here, said Kenrick Chung, director of Ben. Excellence Consultancy, an insurance broker in Hong Kong.
“Hong Kong, as a global financial centre, is a diverse insurance market, both in terms of customer sources and channels,” said Patrick Graham, CEO of Manulife Hong Kong and Macau.
“It is a hub for high-net-worth customers, the Greater Bay Area region, mainland Chinese visitor customers, as well as a strong domestic segment. The Hong Kong market also boosts diverse distribution channels including banks, brokers, agencies and direct [from insurers].”