More people in Hong Kong are buying insurance coverage from a younger age, as the Covid-19 pandemic and wider access to online financial products and services help push sales of new policies in the city. The average age of Hongkongers buying tax-deductible annuity products – a type of pension plan sold by insurers through non-face-to-face channels – is 40 as of December last year, compared with 47 on average in 2019, according to data published by the Insurance Authority. Hong Kong currently has five online insurers. “It is an encouraging sign,” said Carol Hui, executive director of long-term business at the Insurance Authority. “We will continue to spur more younger people to buy products that offer protection for their families and their own retirement needs.” The industry has embraced advanced technologies to help boost coverage, with five virtual insurers competing with traditional giants in reaching out to more Hongkongers through the internet, as customers became more tech-savvy during the pandemic. Hong Kong faces a mortality protection gap of HK$6.9 trillion (US$884.6 billion) or HK$1.9 million per person, exposing many families to financial troubles in the event of the death of the breadwinner, the Insurance Authority said in a study published in September. For its part, the Insurance Authority has loosened a rule to help grease sales during the pandemic. Since February 2020, agents from traditional insurers have not been required to strictly conduct their sales through face-to-face meetings, given the social distancing rules and efforts to contain the virus. “The pandemic has helped encourage more people to buy insurance products online,” said Charles Hung, CEO of Blue, one of the five approved online insurers. “This is likely to be the long-term trend even after the outbreak is over.” Hung said online insurance companies have invested in technology to introduce more innovative products and speed up claim processes in the industry, while also helping customers trim costs. At Bowtie Insurance, about 40 per cent of medical insurance policyholders are below 30 years old, said Fred Ngan Yiu-fai, the online insurer’s co-founder and co-CEO. “More than half of our customers are first-time insurance buyers, which means Bowtie successfully appeals to an underserved market of millennials,” he said. Purchases by younger customers contributed to a 24 per cent year-on-year growth in the sale of new life insurance policies amounting to HK$122.5 billion in the first nine months of 2021, according to industry data. They partly compensated for the massive loss of business from mainland Chinese customers due to the border shutdown. They bought only HK$470 million of new policies during the January-to-September period, a 93 per cent slump from the same period in 2020. Their share was only 0.4 per cent versus 40 per cent at the peak in 2016. Younger customers are also buying more policies at Prudential Hong Kong, its CEO Derek Yung said. The pandemic, as well as government support, has given sales an impetus and the trend is likely to continue, he added. Edward Moncreiffe, chairman of the Hong Kong Federation of Insurers, an industry body representing 138 local insurers, was cautiously optimistic about the outlook for 2022, as people become more aware that their long-term savings are insufficient to tide over any major emergency. “With the expected opening up of the border with the Greater Bay Area , we are expecting to see the revival of some lines of business,” he said. “We still see growing demand from Hongkongers to close their protection gaps.”