“The sale of such an insurance policy indicates Hong Kong’s emergence as a prominent market for ultra-high-net-worth insurance in both Asia and globally,” Moncreiffe expressed in an exclusive interview with the Post. He highlighted that in the past, such large-scale policies were typically only available in the US, UK, and Bermuda. However, Hong Kong has now demonstrated its capability to issue such substantial policies.
HSBC Life CEO Edward Moncreiffe emphasized that Hong Kong has demonstrated its ability to offer mega-sized policies. The primary objective of this particular policy is for estate planning.
While the policy in question was initially underwritten by 19 insurers, the current policy has been solely underwritten by HSBC Life, as confirmed by the insurer. The client was referred by insurance broker Charles Monat Group, specializing in the high-net-worth segment.
Moncreiffe mentioned, “Insurance risk can technically be underwritten and placed anywhere globally, but the client opted to procure it in Hong Kong, showcasing the city’s talent pool and ecosystem in catering to the needs of high-net-worth clients.”
He further added, “As affluent individuals increasingly turn to insurance for wealth leveraging and transfer, Hong Kong is poised to gain a significant share of this business and benefit substantially.”
In addition to issuing this record-breaking policy, HSBC Life has successfully sold 10 other policies valued at US$50 million or more to clients in the past year.
The trend of acquiring mega life insurance policies for succession planning purposes is on the rise in Asia, according to Moncreiffe. He noted that many first-generation private wealth owners are now contemplating the transfer of their assets, businesses, and enterprises to the next generations.
Moncreiffe highlighted that the wealth of most ultra-high-net-worth clients in Asia is primarily tied up in their business operations or real estate, assets that are not easily liquidated.
The demand for estate management and legacy planning through insurance, a practice prevalent among wealthy individuals in Western countries, is gaining traction in Asia as well.
The study conducted by HSBC Global Research in August 2022 forecasts a significant increase in the number of millionaires in Asia, excluding China and Japan, from approximately 10 million in 2022 to 22 million by 2030.
The insurance market in Hong Kong has witnessed substantial growth over the past decade, largely driven by buyers from mainland China. The study revealed that new business premiums in the city had doubled compared to a decade ago.
Mainland tourists spent HK 59 billion (US 7.5 billion) on insurance policies in Hong Kong last year, as reported by the Insurance Authority. This marked a notable increase from previous years, indicating a growing interest in insurance products from mainland visitors.
The promotional efforts of the Hong Kong government, including initiatives led by Chief Executive John Lee Ka-chiu such as roadshows in Southeast Asia and other international markets over the past two years, have significantly raised awareness about Hong Kong’s insurance sector on a global scale.
Moncreiffe emphasized, “Hong Kong should capitalize on these competitive advantages, which are challenging for other cities to replicate. With further incentives and support, Hong Kong’s position in this sector will remain unparalleled.”