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Enoch Yiu

An increasing number of Hong Kong consumers are buying life insurance and other products, bringing coverage in the territory more in line with the world's developed economies, according to HSBC research.

In a survey released yesterday, about 80 per cent of respondents said they had life insurance, with an average of two policies each.

The numbers back the findings of a recent study by Swiss Reinsurance that showed insurance premiums accounted for about 6.5 per cent of gross domestic product in Hong Kong last year. That compares to 8.5 per cent of GDP for developed economies.

The figure is closer to 1 per cent in many emerging markets.

That said, the HSBC survey also found that just 35 per cent of the respondents had purchased general insurance products.

Just 12 per cent of Hong Kong consumers had bought household content insurance, 16 per cent had purchased medical plans, and 18 per cent had bought travel insurance.

The survey, commissioned by HSBC, randomly sampled several thousand Hong Kong residents in July to measure their insurance coverage.

'It showed an increasing awareness of life insurance but a lack of awareness of the need to get insurance coverage for their home and medical expenses,' said Ann Pearce, head of insurance products at HSBC.

In Britain, 50 per cent of the population has household content insurance, or three times more than in Hong Kong.

Ms Pearce said the rapid growth of life insurance in Hong Kong had come as the younger generation takes out life policies as part of savings or investment plans.

The Mandatory Provident Fund launched two years ago had stimulated local workers' interest in having other long-term savings plans.

HSBC, the largest banking group in the SAR, has aggressively expanded into the insurance market. It sells policies through its branch network, financial planners, telephone banking and the Internet.

Ms Pearce said the combined new business sold by HSBC and its subsidiary Hang Seng Bank had a market share of 15.6 per cent of new insurance policies sold in the first three quarters, the second-largest player in the market.

HSBC alone now ranked as the fifth-largest life insurance company in Hong Kong with a 7.6 per cent market share at the end of the third quarter.

In the first three quarters, new premiums rose 15 per cent over the same period a year ago.



Insurance coverage up, but still shy of global benchmark