Based on current trends, Asia’s protection gap will continue to grow and increase to a total of $ 82 trillion by 2020, according to AIA, the independent publicly listed pan-Asian life insurance group.
In terms of some specific markets, AIA estimates the figures will grow to $763 billion in Hong Kong, $570 billion in Singapore, $46 trillion in China, US$12 trillion in India, $1.1 trillion in Indonesia, $528 billion in the Philippines and $1 trillion in Thailand.
AIA’s estimates are based on the 2014 mortality protection gap data of Swiss Re’s 2015 Mortality Protection Gap Report. The Swiss Re report estimates that the mortality protection gap for the region increased to $58 trillion in 2014 from $42 trillion in 2010 for the 13 Asia-Pacific markets.
The gap equalled about 6.6 times the amount of life insured in the markets covered by the report. In many markets the growth of life insurance coverage has lagged behind economic growth, increasing income and the cost of living.
The widening protection gap underlines the growing need for innovative, compelling and meaningful savings and protection offerings by consumers in markets all around the region, said AIA in a statement last week.
AIA and Citi, who partnered together at the end of 2013 in signing Asia’s largest bancassurance agreement, said the report was further evidence that more is needed to be done to close the protection gap in the region.
To support this, Citi is launching a campaign initially in six markets – Hong Kong, Singapore, China, Indonesia, India and Philippines. Themed Have You Done Enough? the campaign aim is to simplify and explain the risk of under insurance whilst at the same time encouraging clients to assess their insurance needs. The campaign will be conducted through Citi’s over 500 branches in the region and through the bank’s digital banking network in Asia.
Han Kwee Juan, Chief Executive Officer, Citibank Singapore Ltd., said: Having adequate insurance coverage for oneself is no longer enough. Consumers should also start planning early for ways to provide for the future of their loved ones and ensure that they are financially protected as the standard of living rises and cost of living increases. Our clients will get to benefit from Citi’s partnership with AIA, which offers them access to a wide range of insurance solutions that are tailored to their needs at every life stages and at a greater value to them.
Asia is increasingly underinsured with a widening protection gap. AIA is committed to and focused on helping our customers meet their protection needs. We are dedicated to address this by investing more in consumer education and provide protections that best suit people’s evolving needs, including through our partnership with Citi, said Gordon Watson, Regional Chief Executive of AIA Group.
AIA has a presence in 18 markets in Asia-Pacific – wholly-owned branches and subsidiaries in Hong Kong, Thailand, Singapore, Malaysia, China, Korea, the Philippines, Australia, Indonesia, Taiwan, Vietnam, New Zealand, Macau, Brunei, a 97% subsidiary in Sri Lanka, a 26% joint venture in India and representative offices in Myanmar and Cambodia.