Insurance policies were becoming a popular choice for wealthy individuals in Asia, including the Greater Bay Area, for estate planning to avoid family disputes and achieve stable growth, according to industry players.
Canadian insurer Manulife, the largest pension provider in Hong Kong, has seen growing demand for insurance products for legacy and succession-planning purposes, according to Patrick Graham, the CEO for Hong Kong and Macau.
Nearly 60 per cent of high-net-worth individuals (HNWIs) in mainland China, Hong Kong, Macau and Taiwan preferred insurance policies to transfer their wealth to future generations, according to a joint survey released by Manulife and Deloitte last week.
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The study was based on interviews and surveys conducted in the second half of 2024 with 140 HNWIs, each with at least HK$7.8 million (US$1 million) worth of assets in those markets.
Patrick Graham, CEO of Manulife Hong Kong and Macau, says Hong Kong is an ideal hub for wealthy individuals to buy policies to transfer their wealth to their families. Photo: May Tse alt=Patrick Graham, CEO of Manulife Hong Kong and Macau, says Hong Kong is an ideal hub for wealthy individuals to buy policies to transfer their wealth to their families. Photo: May Tse>
"The primary motivation behind this trend is preventing inheritance disputes," Graham said.
He said insurance policies, which allow the company to pay beneficiaries named by the policyholders, were an effective tool to ensure smooth wealth distribution.
Graham gave the example of a Manulife client who has three grandchildren and owns a range of assets, including property, funds and stocks.
"He was worried about possible disputes when distributing his assets among his grandchildren," he said. "We advised him to apply wealth equalisation using an insurance policy similar to the property's value. This allows for fair distribution of assets like property and liquid assets, thus reducing inheritance conflicts."
Another Manulife client, according to Graham, was a senior executive with grown-up children living in Australia, the UK and Canada.
"His wish is to travel with the whole family once a year after retirement to spend time together," Graham said. "As his inheritance planning goes beyond just saving for retirement, we advised him to use insurance as a stable wealth growth tool to cover annual travel expenses."
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Hong Kong was an ideal hub for wealthy individuals to buy policies to transfer their wealth, he said.
"Hong Kong's distinct combination of a robust regulatory system, product innovation and global accessibility makes it a preferred destination for HNWIs worldwide seeking effective estate planning solutions," Graham said.
"In addition to high demand from within the Greater Bay Area, we also see interest from Southeast Asian visitors who value Hong Kong's expertise in wealth-planning solutions, its strong legal system and the ability to access sophisticated insurance products."
Daisy Tsang, CEO of HSBC Life Hong Kong, says life insurance products sold in the city contain have trust-like features, which can support estate planning. Photo: Handout alt=Daisy Tsang, CEO of HSBC Life Hong Kong, says life insurance products sold in the city contain have trust-like features, which can support estate planning. Photo: Handout>
Daisy Tsang, CEO of HSBC Life Hong Kong, said the insurer's sales of legacy-planning products to Greater Bay Area customers had nearly doubled last year, compared with the pre-pandemic period in 2019.
Besides mainland Chinese visitors, HSBC Life Hong Kong sells policies to customers from 54 markets. These overseas customers' policy purchases last year rose 50 per cent compared with 2023.
"Hong Kong's strong regulatory and legal framework instils confidence in overseas customers, and the city remains a popular international wealth management centre," Tsang said.
Additionally, Hong Kong life insurance products contain more trust-like features, which can support estate planning.
"Most Hong Kong insurance products offer various death benefit settlement options, allowing flexibility in how the death benefits are paid, which could be a lump sum or in instalments, or a combination of both," Tsang said.
Policyholders can choose to pass on wealth to their heir of choice or use a policy-split feature that facilitates effective distribution of their wealth to loved ones.
FWD, the insurer owned by tycoon Richard Li Tzar-kai, said its HNWI customers were also buying policies in Hong Kong to pass on their wealth to the next generation.
"Hong Kong has no estate duty, which is an advantage for Hong Kong insurance policies to be sold to wealthy customers as estate planning," said Kelvin Yu, FWD's chief product officer.
The Hong Kong Insurance Authority will issue guidelines this quarter for insurance companies to introduce index-linked policies for HNWI customers to manage their wealth.
After the guidelines are issued, Yu said FWD would like to be among the first batch of insurers to launch index-linked policies - a type of investment-linked policy that pays dividends to policyholders based on major stock market indices.
"Index-linked policy has been a popular investment choice for high-net-worth customers in overseas markets," Yu said.
"It would be positive to the local insurance industry to have such product offerings, which will strengthen Hong Kong as a wealth management centre."
This article originally appeared in the South China Morning Post (SCMP), the most authoritative voice reporting on China and Asia for more than a century. For more SCMP stories, please explore the SCMP app or visit the SCMP's Facebook and Twitter pages. Copyright © 2025 South China Morning Post Publishers Ltd. All rights reserved.
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