China’s young affluent class ‘focus more on wealth than life insurance’
The study by insurance firm AIA China and ‘Forbes China’ magazine also predicts number of mainlanders with assets of more than 10 million yuan will reach 1.12 million by the end of 2015
China’s young affluent class places less importance on insurance than it does on wealth creation, with only half having life insurance cover, a new survey shows.
The survey on the life insurance needs of the mainland’s high-net-worth individuals (HNWIs), jointly conducted by insurance firm AIA China and Forbes China – the Chinese-language edition of the American business magazine, Forbes – showed that an average of 65.4 per cent of respondents were covered by life insurance products, but the percentage among those aged less than 30 was relatively low at 51.4 per cent.
The life insurance coverage of respondents aged over 60 was also lower than the average at 44.7 per cent.
The study, carried out between March and June this year using questionnaires, surveyed 812 affluent mainlanders with investable assets that are worth more than 10 million yuan (HK$12.6 million).
These assets include cash, stocks, bonds, funds, insurances and wealth management products but not real estates.
“For the age group of below 30, as they are in the early stage of career development and have just started wealth accumulation, they tend to pay more attention to wealth creation,” the study said, explaining the relatively low life insurance coverage among young HNWIs.
More restrictions were set for older people when buying life insurance products, which had led to the lower coverage among those people aged above 60, the study said.
Some HNWIs believed that they did not need life insurance coverage, while other said they did not have time to look into the idea of buying insurance, it said.
Some of those people in the survey said they chose other wealth management products with shorter-term returns instead of paying for insurance coverage because they felt secure about life, according to the study.
John Cai, chief executive of AIA China, said the company was optimistic about the potential of life insurance market among mainland HNWIs. The insurer would step up its efforts to design new products and services involving wealth management solutions, he said.
The study also predicted that the number of HNWIs in China would reach 1.12 million by the end of this year – up from 910,000 last year. The value of investable assets is expected to reach 34.9 trillion yuan compared with 29.6 trillion yuan at the end of last year.
The average age of the HNWIs is 43, while more than half of them are aged between 30 and 49, the survey said.
