Sales of traditional insurance products benefit from tighter rules on investment-linked policies

A tightening of the regulations on investment-linked insurance policies since July has made insurers shift focus to basic life policies and annuity products, a trend industry players expect to continue this year.

Statistics released by the government last week showed premiums from new investment-linked insurance policies rose 11.7 per cent from 2012 to HK$19.1 billion last year.

The growth rate was lower than that of premiums from traditional insurance policies, which rose more than a fifth to HK$73 billion.

Tay Keng Puang, managing director and chief executive of MassMutual Asia, said insurers had had to cope with the challenges of the new regulation by urging sales agents to promote traditional life policies, which allow insurance companies to decide how to invest the premiums and pay guaranteed dividends to policyholders.

MassMutual also focuses on annuity products, a type of retirement policy that allows holders to pay premiums for some years for guaranteed monthly payments until death.

Sales of annuity policies grew 73 per cent last year to HK$3.13 billion, statistics showed.