HONG KONG, Dec 20 (Reuters) - Hong Kong has awarded Bowtie Life Insurance, a company backed by Sun Life Financial’s Hong Kong unit, with the first online-only insurance licence under the city’s “fast-track” scheme.
The online platform will operate in a market worth more than $63 billion in insurance premiums, and will compete with players such as AIA Group and the local unit of Prudential Plc .
Bowtie Life Insurance, which is also supported by Sequoia Capital managing partner Neil Shen’s Hong Kong X Technology Fund, will offer life insurance directly to consumers rather than selling through intermediaries such as agents or banks, as is common in Hong Kong.
More than 80 percent of customers are willing to use digital and remote contact channels including email, mobile apps, video or phone instead of interacting with insurers via agents or brokers, a report by consultancy EY showed.
Hong Kong is home to a developed life insurance market, with a life and health insurance premium to GDP ratio of 17.94 percent in 2017, the second-highest in Asia after Taiwan, according to insurer Swiss Re.
The licence comes as Hong Kong is pushing a number of financial technology or “fintech” initiatives in an effort to compete better with rival centres such as Singapore and London to reel in more investments.
The Hong Kong Monetary Authority (HKMA), Hong Kong’s de facto central bank and banking regulator, will issue the first licences to online-only banks in the first quarter of next year.
Hong Kong’s Insurance Authority’s “fast-track” scheme was launched last year to speed up applications for insurers operating solely online.
Reporting by Alun John, Editing by Sherry Jacob-Phillips