HSBC Life, AIA, BOC Life among Hong Kong insurers expanding online sales channels, medical products as pandemic causes worst slump on record
- Developing digital sales and medical cover will go some way towards rebooting the Hong Kong insurance sector, HKFI chairman says
- There has been a rise in demand for medical insurance products driven by the coronavirus crisis
Hong Kong insurance companies are developing more online sales channels and introducing more medical and retirement products to boost sales as the sector is poised for its worst slump on record, according to industry players.
“The full-year sales are not looking good. Cross-border traffic has not picked up. The government has tightened social distancing since July due to the third wave of infection. This has stopped the 100,000 salespeople from meeting clients to sell the policies in person,” said Eric Hui Kam-kwai, chairman of the Hong Kong Federation of Insurers (HKFI), the industry body for the sector.
Total new sales of life insurance in the first half-year dropped 34 per cent from a year earlier. If the trend continues, it will be the worst slump on record, bypassing 2008 when sales dropped 25 per cent during the year.
To cope with the challenges, HKFI earlier this month introduced a virtual platform to assist insurance companies in developing online sales channels.
“Local insurers have also been selling more medical and retirement products to Hong Kong customers since April last year when the government introduced tax incentives for these products,” Hui said.
HSBC Life, AIA and BOC Life have all seen more online sales this year.
HSBC Life’s digital sales rose 5 per cent year on year in the first half of 2020, with one in four of its protection policies sold via online channels. The insurer introduced video conference services for its staff to explain policies to customers.
Bank of China Life saw its online sales in the first half double from a year earlier.
AIA, the largest insurer in Hong Kong, allows thousands of salespeople to use telephone, video conference and other online tools to sell policies.
“We have seen great receptiveness from our customers as well as our financial planners in adapting to digital channels for insurance purchase,” said Peter Crewe, chief executive of AIA in Hong Kong and Macau.
“AIA also allows clients to purchase insurance policies and make claims online,” Crewe said.
The pandemic led to greater demand from customers for medical insurance products. HSBC Life launched a new medical plan in July that offers HK$40 million of coverage per year, the highest amount in the city.
“The outbreak of Covid-19 has raised Hongkongers’ awareness of the need for sufficient protection,” said Edward Moncreiffe, chief executive of HSBC Life Hong Kong. BOC Life also plans to introduce more medical and retirement products.
“We see very strong sales momentum. It’s partly due to pandemic and strong growth of the e-commerce market,” Kwock said.
