The Asia-Pacific (APAC) region’s high-net-worth (HNW) market presents a significant growth opportunity for insurers, spurred by the region’s expanding wealth and vibrant entrepreneurial spirit, according to a report by Swiss Re.
Currently, APAC holds around 30% of the world’s HNW financial wealth, second only to the Americas. This growth has been supported by decades of strong economic performance, with the region now accounting for 28% of the global HNW population.
The report, titled The High Net Worth Insurance Market in APAC: Wealth Growth, Preservation, and Succession Planning, outlines how individuals in the HNW segment possess assets ranging from $1 million to $50 million, while those with assets above $50 million are classified as ultra-high-net-worth (UHNW). The surge in global financial wealth in 2023, aided by a recovery in equity markets and economic resilience, has led to an increase in USD millionaires, especially in key APAC cities such as Tokyo, Singapore, Sydney, Hong Kong, and Beijing. These cities are among the top global hubs for millionaires.
China, in particular, stands out, with 6 million millionaires—second only to the United States. Experts believe that the wealth gap between APAC and the US will continue to close as the APAC region outpaces the US in wealth growth, particularly in emerging markets.
For the insurance industry, this expanding wealth represents significant opportunities. Property insurers are expected to benefit immediately as affluent households in the region acquire more high-value assets, including luxury homes and vehicles.
Life insurers also stand to gain, especially in emerging APAC markets where the millionaire population is still developing. A rising number of first-generation entrepreneurs are joining the HNW ranks, many of whom are now grappling with legacy and estate planning for the first time—a need that insurance products are well-positioned to address.
Post-pandemic shifts reveal that many HNW individuals are rebalancing their priorities between wealth preservation and growth. With heightened geopolitical tensions, there is now a stronger focus on cross-border diversification, and life insurance products are increasingly seen as essential in helping clients safeguard and grow their wealth internationally.
Moreover, advancements in remote processing and distribution have revolutionized how insurers operate. These changes have enabled more flexible and widespread service delivery, allowing insurers to reach clients across a broader geographic range.
Despite these promising opportunities, insurers in APAC face several challenges. Rising interest rates have increased the cost of premium financing, a traditional driver of HNW insurance sales, and have also contributed to higher rates of policy lapses and surrenders. Clients, faced with liquidity constraints, are shifting their preferences towards other financial products. Additionally, insurers must navigate evolving regulatory landscapes and an industry-wide shortage of skilled talent.
Mainland China, despite recent economic challenges, remains one of the most promising markets for insurers. Wealthy Chinese clients are increasingly seeking overseas diversification due to the volatility of domestic investment returns, driving demand for insurance solutions designed for global asset management.
To seize these growth opportunities, insurers and brokers are exploring new markets, developing innovative products, and leveraging alternative distribution channels such as bancassurance. However, the future success of the HNW insurance market in APAC will hinge on the industry’s ability to continuously innovate, adapt to market dynamics, and collaborate across various sectors.
As the APAC region continues to grow and evolve, insurers must remain nimble to capture the full potential of this thriving market.
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