Hong Kong Insurance Report Q2 2013

Includes 3 FREE quarterly updates

As of early 2013, developments in the industry highlight Hong Kong's position as a large, rapidly growing and dynamic market for non-life and life insurance. The coming months will likely include the establishment of the new Independent Insurance Authority, as the successor to the Office of the Commissioner for Insurance (OCI). Other protagonists include the local subsidiaries of many of the world's leading (re) insurance companies. Although they differ widely in their areas of interest and business models, almost all of them are able to achieve substantial economies of scale in their operations across the Asia Pacific region as a whole.

In the non-life segment, growth is being driven by: the economic expansion of China, for which Hong Kong is a crucial services centre; the general development of the Asia Pacific region; pricing discipline in what is quite a fragmented market; new regulations, such as those that require apartment block owners' corporations to take out liability cover; and initiatives carried out by particular companies. In relation to the latter, marine insurers, for instance, are looking for new opportunities from the further development of Hong Kong as a trading port. Health insurance premiums are being boosted by demographics given that the population is ageing. A key development in the last year or so has been the purchase in early March 2012 of the Hong Kong non-life insurance operations of HSBC Insurance and Hang Seng Insurance by AXA and QBE, respectively. Both of these insurers will benefit from long-term bancassurance deals with HSBC and Hang Seng. AXA is now the largest player in the Special Administrative Region's non-life segment, with a low double-digit market share.