HK insurers look for cover after new financial regulations come into force

"The agent, a young woman from Guangzhou who graduated from The University of Hong Kong, didn't pitch her products like some of the vendors who contacted me in my hometown. She explained everything on the phone before I arrived, so it only took one day to go through the assessment procedures and sign the contract－and most of the time was spent waiting in line with other buyers. I think at least 80 percent of them were from the mainland, just like me."

Donald Shengbo Tang, head of Hong Kong and China insurance and non-bank finance at Nomura, a Japanese financial holdings company, said that while there are definite advantages to purchasing insurance in Hong Kong, people should view the surge in the number of mainland customers from a rational perspective.

"There will be a further increase in new premiums signed by mainland customers in the next couple of months, but I am not expecting that it will be a huge increase, let alone pose a threat to the mainland market," he said.

Data supplied by the China Insurance Regulatory Commission show that the mainland insurance market has an annual growth rate of 13.4 percent. Last year, the value of insurance policies bought in the mainland was 2.4 trillion yuan, a rise from 1.3 trillion yuan in 2010, according to the commission.

The data shows that last year the total assets of the combined mainland and Hong Kong insurance markets more than doubled to 12 trillion yuan from 5 trillion yuan in 2010.

"As the world's third-largest insurance market, China has great potential for future development. We have witnessed how regulations and product design have improved in recent years," Shengbo Tang said.

"In the long run, Hong Kong will still be a good place for many customers, but the mainland market is expected to continue to expand, so more people will be willing to buy insurance products from local companies."