New life insurance sales rose to HK$115.9 billion (US$14.9 billion) from the HK$103 billion reported in the same period last year, which itself was a record, according to the Insurance Authority. The level is the highest since the authority was established in 2016 and 16 per cent higher than the total of HK$99.9 billion in the first half of 2019, before the Covid-19 pandemic.
26% Policy Issued - Sales of policies to mainland visitors in the first half amounted to HK$29.7 billion, down 7 per cent from HK$31.9 billion a year earlier. Still, that is higher than the pre-Covid level, when mainlanders bought HK$26.3 billion of life and medical policies in the first half of 2019.
Mainland visitors accounted for 26 per cent of the total life and medical premiums in the first half. Besides mainland visitors, the strong growth was also due to HSBC Life issuing the world’s most valuable life insurance policy at the beginning of this year. The policy, with a protection value of US$250 million, was certified by Guinness World Records in February.
Though the premium was not disclosed, the sale was a major boost to total sales of new life insurance and helped HSBC Life maintain its position as the top life insurer in Hong Kong in terms of new sales in the first half.
Tax incentives - the Hong Kong government created in May last year to encourage wealthy people to set up family offices in the city, along with the introduction of the new Capital Investment Entrant Scheme in May, have made Hong Kong an ideal hub for attracting high-net-worth clients to buy jumbo policies for wealth management and estate planning. .
Other leading players, such as AIA Group and Manulife, also reported good sales growth in the first half.
US Dollar Attractive - Mainland customers like to buy insurance policies in Hong Kong as the products are sold in US dollars or Hong Kong dollars. This helps hedge against a falling yuan, which has weakened 13 per cent against the US dollar over the past two years.
In the first half, 21 million Travellers visited Hong Kong, an increase of 64 per cent from a year earlier, according to data published by the Hong Kong Tourism Board. Two-thirds were from the mainland.
Mainland Chinese tourists last year spent HK$59 billion on life and medical insurance policies in Hong Kong, higher than the level recorded in 2017 and 2019 of HK$43 billion to HK$51 billion, respectively.
The increase in the number of "Hongkongers travelling outside of the city also drove up demand for travel insurance, sending new premiums for accident and health insurance up 12.5 per cent to HK$11.7 billion in the first half, the Insurance Authority’s data showed.
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