Despite the economic challenges in 2020, the APAC life insurance industry bounced back in 2021, as the COVID-19 pandemic highlighted the importance of life insurance for financial security.
China and India were the major drivers of the industry with double-digit growth in 2021 and are expected to maintain a CAGR of 5%–7% over 2021-26. Increased awareness and conducive market factors are expected to drive the region’s other emerging markets – Vietnam, the Philippines, Indonesia, Thailand, and Malaysia to exhibit strong growth over 2021-26, with a CAGR of 21.6%, 15.9%, 8.2%, 4.9%, and 9.8%, respectively.
Japan, Taiwan, and South Korea are among the most saturated life insurance markets in the region. The life insurance industry’s growth in these markets was negative to flat during the review period. The outlook for these markets is expected to be buoyant as compared to their performance during 2017–21. Over 2021–26, Japan, Taiwan, and South Korea are expected to record a CAGR of 4.7%, 5.1%, and 3.1%, respectively.
The region’s other mature markets include Hong Kong and Singapore. Over 2021–26, life insurance in these markets is expected to grow at a CAGR of 6.5% and 9.6%, respectively. In Australia, life insurance is expected to continue to decline, albeit at a lower CAGR of 1.9% over 2021–26.
Personalization, mental health, well-being, and environmental, social, and governance (ESG) were some of the key trends witnessed in the APAC life insurance industry.
Examples of personalization include the AIA Connect app by AIA Hong Kong, which guides customers in recognizing the protection gap in their existing life policies through cloud computing and AI.
Nippon Life and Dai-ichi Life in Japan, Shinhan Life in South Korea, and Axa and Manulife in Hong Kong increased their ESG-compliant investments as part of sustainable practices.
The top 10 insurers accounted for 38.1% of the region’s market share in 2020, while the top 20 occupied a 56.8% share. The composition of the top 10 insurers remained unchanged during 2019 and 2020, except the entry of Taiwan-based Cathay Life as the 10th largest insurer, replacing Japan Post.
Two out of the top 10 insurers were based out of China and one from India. They were China Life, Ping An, and LIC, which held a combined market share of 7.2%. The UK-based Prudential Public and the US-based Prudential Financials were the only two foreign insurers among the top 10 insurers.
China Life and Ping An retained their second and sixth positions during 2019 and 2020 in the global market, respectively. The insurers were also the top two in the regional market. China Life opted for digital transformation to expand distribution channels and improve its operations. On the other hand, Ping An is focusing on its product innovation and ecosystem upgradation.
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