![Prudential sees windfall from Hong Kong’s cash-for-residency scheme, Greater Bay Area opportunities, CEO says](https://www.naphjas.com/wp-content/uploads/2024/03/17b636ba-965f-4303-bd42-52a52bad69ea_41d7af49.jpg)
31 Mar Prudential sees windfall from Hong Kong’s cash-for-residency scheme, Greater Bay Area opportunities, CEO says
Hong Kong’s revamped investment-migration programme is paying off for insurers such as Prudential Hong Kong, which is planning to expand its product line to appeal to the wealthy would-be Hongkongers taking advantage of the scheme, according to its top boss.
Like peers Manulife and AIA, as well as major banks such as HSBC and Bank of China (Hong Kong), Prudential has seen growing interest in investment products from prospective clients under the revamped Capital Investment Entrant Scheme (CIES).
The scheme allows wealthy individuals and their families to gain fast-track residency when they make investments of at least HK$30 million (US$3.8 million) in Hong Kong-listed stocks, bonds, deposits, funds, investment-linked insurance policies or non-residential properties.
Visitors from mainland China spent HK$59 billion on insurance policies in Hong Kong last year, representing about 33 per cent of all industry sales, according to data compiled by the Insurance Authority. The total topped sales of HK$43.4 billion in 2019 and HK$47.6 billion 2018.
![Lawrence Lam, CEO of Prudential Hong Kong, poses during a media briefing at the Marriott hotel in Hong Kong on March 27, 2024. Photo: Enoch Yiu](https://cdn.i-scmp.com/sites/default/files/d8/images/canvas/2024/03/29/bd88c626-dde0-4f6b-ad94-77ad09a1c4b2_dc94eb7d.jpg)
“We have received many inquiries from customers about our insurance policies in relation to the CIES since its launch on March 1,” said Lawrence Lam, CEO of Prudential Hong Kong.
“It shows high-net-worth individuals and their families are interested in investing in investment-linked policies to achieve their goal of settling in Hong Kong with their families. Prudential will definitely listen to the demand of these customers and provide products for them.”
The company already has a qualified insurance product, the PRULink Opal Investment Plan, for the CIES scheme, and will explore ways to promote this product to potential customers to tap opportunities arising from the CIES.
AIA’s 2023 profit jumps 15% on insurance sales to mainland visitors
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Meanwhile, Prudential plans to further expand its products and coverage to capture business opportunities in the Greater Bay Area, Lam said.
“There are an increasing number of Hong Kong residents who have frequently travelled to the mainland cities of the Greater Bay Area, while some have even relocated to live or work in these cities,” Lam said. “Medical coverage is a key concern for these customers.”
The bay area was conceived by Beijing in 2019 to create an economic powerhouse by further integrating Hong Kong, Macau and nine mainland cities in Guangdong province.
Prudential entered the Macau market last year to compete with AIA, AXA and FWD, among others. The insurer set up its first branch in the gaming hub in June, giving it a presence in all 11 bay area cities.
The company has teamed up with partners to offer cross-border healthcare services, allowing Hong Kong policyholders to access better and wider-ranging medical treatment in the Greater Bay Area cities, he added.
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In February, Prudential began a collaboration with Shenzhen New Frontier United Family Hospital, which allows eligible customers to get treatment at the hospital without worrying about payment, as their bills go directly to Prudential. And in November, the insurer joined the Hong Kong Integrated Oncology Centre and Zhongshan Chenxinghai Hospital to launch cross-border cancer treatment for Prudential clients. Again, billing is handled directly through Prudential.
“With the integration of Hong Kong, Macau, and the nine mainland cities in the Greater Bay Area, we expect more cross-border medical insurance will be needed,” Lam said. “We will continue to explore ways to meet the customers’ cross-border insurance needs.”
Prudential, headquartered in both London and Hong Kong, on March 20 reported strong results for 2023 as the return of mainland Chinese visitors to Hong Kong boosted life-insurance sales: Hong Kong new sales rose 290 per cent year on year.
“Sales growth has continued in the first two months of 2024,” Anil Wadhwani, Prudential’s global CEO, said in a post-result briefing. “We believe that the growth prospects in Hong Kong continue to be solid.”
Hong Kong reopened its borders in January 2023 after Beijing abandoned its anti-pandemic curbs to shore up the sputtering economy. Some 26.8 million mainland Chinese thronged the city last year, reaching 61 per cent of the level seen in 2019. They make up about 80 per cent of all arrivals in Hong Kong annually.