May Zhang, a 28-year-old from the southern Chinese city of Shenzhen, holds a master’s degree in engineering from the University of Oxford, but now makes her living selling insurance in Hong Kong.
Drawn by lucrative pay, Zhang is part of a growing band of well-educated young Chinese selling insurance in the territory to buyers from mainland China who are seeking refuge from a falling yuan and are rattled by healthcare safety fears at home.
These agents are seen as having an advantage in winning business from clients from China’s upper and middle classes, as they have similar educational and social backgrounds.
“Every time the yuan depreciates or when things like the vaccine scandal happens, I get more people panicking and asking about Hong Kong insurance,” said Zhang, referring to recent cases in which Chinese companies falsified data and sold ineffective vaccines.
The yuan has dropped more than 6 percent since the middle of June amid worsening Chinese economic data and some forecasts say it will ease further if a US-China trade dispute intensifies.
According to the Hong Kong Insurance Authority, new business premiums from mainland clients amounted to HK$11.8 billion (US$1.5 billion) in the first quarter, with 95 percent of that spent on medical or protective products.
While that was down 37 percent from the first quarter of last year, partly due to a decline in endowment and life insurance policies, agents said the number of Chinese clients was rising, especially from middle-class families and millennials.
“The average policy size has got smaller, but our client base has grown much larger,” said Sheria Li, 32, a fashion-buyer-turned-manager at a Hong Kong insurance company who joined the sector in 2015.
Li, who oversees about 40 people with a mainland background like hers, said total commissions were growing as much as 50 percent per year.
“More people on the mainland are only just starting to be aware of Hong Kong insurance,” she said. “The market potential is huge.”
AIA Group, a Hong Kong-listed insurer, reported a 20 percent rise in new business in its first quarter, fueled by demand for insurance products in mainland China and Hong Kong.
Agents say Hong Kong insurance provides more comprehensive and higher protection for health issues than mainland products.
Insurance-savings products denominated in Hong Kong or US dollars are also seen as attractive investments for hedging against falls in the yuan.
Hong Kong insurance polices are not protected by law on the mainland, making it a legal gray area for mainlanders who buy them, which involves traveling to Hong Kong to sign contracts.
However, many are willing to take the risk, citing trust in big multinational insurers working from the territory.
Thanks to booming demand, successful agents were easily able to qualify for membership in the Million Dollar Round Table (MDRT), a global association of top-earning insurance professionals, Li said.
Most new joiners were able to achieve MDRT’s entry requirement of an annual income of HK$533,200 by their second year, she said.
The Hong Kong Insurance Authority does not provide figures for the number of mainland Chinese insurance salespeople in the territory.
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