HONG KONG’S NON-LIFE INSURERS SUSTAIN PROFITABLE UNDERWRITING - AM BEST

KUALA LUMPUR, Dec 18 (Bernama) -- Hong Kong’s non-life insurance industry has shown an ability to sustain profitable underwriting over the past five years, supported by the performance in the general liability and property damage lines of business, according to a new AM Best report.

The global credit rating agency said accident & health (A&H) coverage remained the largest contributor to gross written premiums (GWP) between 2020 and 2024, followed by general liability, which includes employees’ compensation, and property damage.

When combined with motor, these four lines accounted for nearly 89 per cent of Hong Kong’s non-life segment GWP of HK$100.5 billion (US$12.9 billion) in 2024, AM Best said in a statement. (US$1=RM4.07)

The report noted that the industry’s overall operating profit reached HK$8.1 billion in 2024, including HK$3.3 billion in undiscounted underwriting profits. The 10 largest direct non-life insurers generated a combined underwriting profit of HK$552.8 million, representing about 17 per cent of the market’s total underwriting profit.

“The overall performance of Hong Kong’s non-life market is driven by factors such as increased consumer awareness, ongoing regulatory initiatives, and the development of the Guangdong-Hong Kong-Macao Greater Bay Area project,” said AM Best senior financial analyst, Stephanie Mi.

She added that a stable economic environment has also contributed to the sector’s resilience.

Based on data by the Hong Kong Insurance Authority, AM Best’s analysis stated that the direct non-life segment remains highly competitive, with no single insurer holding more than a 10 per cent market share. The non-life segment has maintained a generally stable momentum, recording GWP growth of around three to eight per cent annually from 2020 to 2023.

A&H insurance continues to be a key growth area, driven by rising demand for travel insurance and group medical coverage, especially in the post-pandemic period.

AM Best cautioned that moderate economic expansion combined with external headwinds could increase capital market volatility, potentially affecting asset prices and financial stability.

-- BERNAMA