Mainland Chinese boost sales of life insurance policies in Hong Kong
Cross-border visitors have done much to boost the sales of new life insurance policies to nearly the figures seen before the financial crisis
New premiums for life insurance policies are nearly back to pre-financial crisis levels, with mainland visitors playing an important role in the rebound.
Mainland buyers accounted for 12.8 per cent of the new premiums paid by individuals for insurance policies sold in Hong Kong last year.
That figure was up from 9 per cent the year before and represented the first time the contribution from mainlanders reached double digits.
New premiums for policies bought by mainlanders rose 57.1 per cent to HK$9.9 billion last year, the latest figures from the Office of the Commissioner of Insurance show.
Excluding retirement schemes, new premiums for life policies rose 10.4 per cent to HK$77.8 billion, the highest figure since 2007.
Chan Kin-por, a legislator who represents the insurance sector, said traditional products dominated at present. Investment-linked policies, which allow buyers to choose which investment funds the premium will be put into, used to be the favourite insurance product before the crisis.
New premiums from traditional life policies rose 22.1 per cent to HK$60.3 billion while those from investment-linked policies were down 17.7 per cent to HK$17.1 billion, largely because of poor market performance last year.
Local insurance companies can only sell to mainlanders in Hong Kong but not across the border.
Chan said some mainland visitors came to Hong Kong for insurance products as much as for luxury shopping: "Mainlanders are attracted by the diversified and well-regulated insurance products in Hong Kong. They are one of the growing customer groups for the new business in the sector."
Benny Law Chi-keung, chief agency officer at ING Life Insurance, said the insurance business would grow as more mainlanders came to Hong Kong for tourism or business.
Gross premiums collected by the Hong Kong insurance industry last year amounted to HK$255.2 billion, an increase of 13 per cent over 2011.
The general insurance sector sold new policies with gross premiums amounting to HK$39.3 billion, up 13.2 per cent from 2011.
Accident and health insurance, the largest components of the general insurance segment, rose 10.2 per cent, with a total gross premium of HK$10.3 billion last year.
The property insurance market recorded a 21.3 per cent annual growth, with HK$9.5 billion in gross premiums last year.
HSBC Insurance said it ranked No1 in new individual life insurance business last year, with a market share of 22.3 per cent. HSBC and its subsidiary Hang Seng cornered a combined market share of 27.8 per cent in the sector.