A bumper sale of ‘jumbo’ life insurance policies
In the space of just one month recently, we issued five ‘jumbo’ life insurance policies, worth a total sum insured of more than $420 million.
Issued and fully underwritten by our insurance business HSBC Life, the policies were taken out by five ultra-high-net-worth clients in Hong Kong, Singapore and mainland China.
“First-generation wealth in Asia is now at a tipping point where people are increasingly keen to safeguard their family businesses and wealth,” said Edward Moncreiffe, CEO for Global Insurance, HSBC.
These five policies are testament to our capability in providing legacy planning solutions to address such issues.
“Our clients are looking for lower-risk ways, like life insurance, to transfer their wealth seamlessly to the next generation, particularly in times of market volatility.”
Three of the five were ‘family policies’, where the total sum insured is divided among members of the same family.
Previously, the most common approach to wealth transfer would be through wills or the use of trusts, but demand for insurance from high-net-worth family clients is higher than ever before.
“Family wealth is often complex and money can be tied up in property or business, so insurance can provide more flexibility, liquidity and divisibility,” said Edward, who added that an insurance policy could help avoid difficult conversations, because of its privacy and incontestability aspects.
“Our clients are looking for lower-risk ways, like life insurance, to transfer their wealth seamlessly to the next generation, particularly in times of market volatility.”
The rise in interest in insurance is backed up by research from McKinsey, which showed that the wealthiest families in Asia-Pacific are set to transfer as estimated $5.8 trillion by 2030.
“We’re seeing a significant generational shift in wealth – and this is a big and growing market for us, which reflects the trust our wealthy clients place in our brand and our security.
“With leading offshore capabilities in Hong Kong and Singapore, and our onshore presence in mainland China and India, it’s one that we’re perfectly placed to take advantage of.
“We will continue to invest in our people, products and services, leveraging our footprint in Asia and our capability in writing jumbo policies, so we can meet the growing demand for insurance in wealth management and estate planning.”
In Asia, the UHNW segment is projected to record the strongest average annual growth of 7.4%. Compared with other parts of the world, it is forecast to contribute 27% of the global UHNW population in 2028, according to Altrata – World Ultra Wealth Report 2024.