More Hongkongers buying policies from digital insurers, with lots of room left for growth, Bowtie boss says
- Bowtie, the first of four virtual insurers to launch five years ago, has sold US$11.5 billion worth of life and medical protection value since then
- Direct sales of insurance in Hong Kong rose to 8.5 per cent of the total last year, from 2 per cent in 2018, but still trail behind Europe’s 16 per cent
Online sales of insurance policies have grown swiftly in Hong Kong since the introduction of digital insurers five years ago, but the city still lags behind overseas markets, according to the head of the city’s first online insurer.
The company, which has 150 employees, has secured about 140,000 customers and sold total protection value of HK$90 billion (US$11.5 billion) as of the end of April, according to Insurance Authority data. It sold almost 6,000 policies in the fourth quarter last year, 10th best in the city.
“The achievement of Bowtie’s sales data shows that Hong Kong customers accept the idea of buying insurance products online without agents,” Fred Ngan Yiu-fai, Bowtie’s co-founder and co-CEO, said in an interview.
Bowtie focuses purely on protection products, as opposed to investment-linked offerings. Policies under the Voluntary Health Insurance Scheme account for 60 per cent of its sales, simple term life policies for 20 per cent and critical-illness protection for 15 per cent.
“The three-year Covid-19 pandemic helped encourage people to buy products online,” Ngan said. “However, even a year after it ended, we saw our sales rise to HK$250 million last year, up 50 per cent from a year earlier.”
About 8.5 per cent of all life or medical policies sold in the city last year were bought through direct channels, compared with 2 per cent in 2018 before the virtual insurers joined the market.