Life Insurance in Asia (eBook)

DR. STEPHAN BINDER is a director in McKinsey & Company's Shanghai office and leader of the Insurance Practice in the Asia-Pacific region. He has been with McKinsey since 1995 and is an advisor to many of the region's leading insurance companies and banks, with a long track record of successfully working with leading local companies and multinationals in Asia, Europe, and North America. Stephan has been published widely and is a prominent speaker at conferences on financial services topics. A German national, he holds a PhD from the University of M??nster and a master of business administration and economics from the Witten/Herdecke University. JOSEPH LUC NGAI is the managing partner of McKinsey & Company's Hong Kong office, and leads McKinsey's life insurance practice in Asia. He has advised several leading domestic and multi- national insurers and banks in Asia, counseling many of them through multi-year transformation journeys. He is a sought-after speaker on financial topics, and has appeared frequently at industry conferences as well as in the media. A Hong Kong native, he holds an AB from Harvard University, a JD from Harvard Law School, and an MBA from Harvard Business School.

Acknowledgments ix

Introduction xi

What Is New in This Second Edition? xii

CHAPTER 1 Emerging Themes in Asia 1

A New Paradigm 3

Asia as the Emerging Powerhouse in Insurance 4

A Heated Battle between Multinationals and Locals 11

The Changing Face of Distribution 22

Driving Innovation in Insurance 35

Changing Product Mix to New Needs of Asian Consumers 40

Conclusion 54

CHAPTER 2 China: Yes, Size Does Matter 57

A Winding Road to the Top 59

Rise of the Chinese Giants 62

Foreign Multinationals in China: Scaling the Great Wall 66

Key Challenges to Overcome in China 71

The Future: Growth in Uncertainty 84

CHAPTER 3 India: Dance of the Elephant 87

Dawn of a New Era 89

Changing Landscape of the Life Insurance Market 93

Path to Sustainable Growth in the New Normal 96

The Future: India Life Insurance 2.0 105

CHAPTER 4 Japan: A Giant Awakening? 107

Continued Stagnation in the Overall Market 110

Shifting Competitive Landscape 112

Emerging Opportunities in Certain Product Submarkets 121

Increasing Scope for Innovative Sales Models 129

The Future 133

CHAPTER 5 South Korea and Taiwan: An Increasingly Localized Game 135

Highly Mature Markets 138

Mismatched Book of Assets and Liabilities 139

Entrenched Position of Leading Domestic Players 140

Foreign Players Fighting to Gain Share from Local Incumbents 141

South Korea: Solid and Resilient 143

Taiwan: Darkness before Dawn? 152

CHAPTER 6 Hong Kong and Singapore: Refusing to Mature 165

Profitable and High-Growth Contributor 170

Small but Stable Market for Latecomers 171

Attractive Asian Base for Multinational Insurers 172

Hong Kong: The China Opportunity Offshore 173

Singapore: Structured and Profitable 185

CHAPTER 7 Southeast Asia: The Underappreciated Growth Engine 191

Increasing Competition between Foreign and Local Players 195

Tailored Products for Market Niches 199

Channel Upgrades to Reach More Customer Segments 200

The Future: Reaching Scale 203

Indonesia: The Next Growth Frontier 203

Vietnam: Little China? 207

Looking Forward: Major Challenges Ahead 210

CHAPTER 8 The Road Ahead: A New Paradigm for Life Insurance in Asia 213

Changing Context: A Much More Difficult and Nuanced World 213

Seven Priorities for Winners 213

Sustaining Growth in the Next Decade 222

Appendix 223

Reference Sources 223

Methodology 226

Notes 227

Index 231