Life Insurance in Asia
Sustaining Growth in the Next Decade
2nd Edition
Published on 4. December 2012
Book
Hardback
256 pages
978-1-118-32317-5 (ISBN)
Description
An incisive look at the war for market share in the Asian life insurance market
Although the life insurance industry in Asia has emerged from the financial crisis stronger than ever, it has not escaped unchanged. As the general focus of insurance companies across the continent moves towards profitability beyond growth, tightening regulatory measures, shifts in consumer preferences, and risk tolerance, battle lines have been drawn between local incumbents, attackers, and foreign players. Life Insurance in Asia: Winning in the Next Decade, Second Edition looks at the ways in which small local agencies and multinational companies alike are seizing control of as much of the market as they can by aggressively recruiting new agents, leveraging new channels, and selling new products to cash in on the explosive Asian markets.
Thoroughly revised and updated, this new edition offers a comprehensive introduction to the booming Asian life insurance markets and outlines exactly what it takes to capture the opportunities that are emerging. Drawing on the research and experience of the McKinsey Asia financial services team, it includes everything you need to know about the battle for the life insurance market in Asia.
* Looks at how China and India are becoming increasingly important players on the international life insurance scene
* Goes behind the scenes of the Asian life insurance industry and the contentious battle for market share
* Outlines the steps to successfully entering, and prospering, in the Asian market
The life insurance industry in Asia is changing like never before. What the future holds, no one knows, but with Life Insurance in Asia in hand, you'll have a clear idea of the factions in play and the rules of the game.
Although the life insurance industry in Asia has emerged from the financial crisis stronger than ever, it has not escaped unchanged. As the general focus of insurance companies across the continent moves towards profitability beyond growth, tightening regulatory measures, shifts in consumer preferences, and risk tolerance, battle lines have been drawn between local incumbents, attackers, and foreign players. Life Insurance in Asia: Winning in the Next Decade, Second Edition looks at the ways in which small local agencies and multinational companies alike are seizing control of as much of the market as they can by aggressively recruiting new agents, leveraging new channels, and selling new products to cash in on the explosive Asian markets.
Thoroughly revised and updated, this new edition offers a comprehensive introduction to the booming Asian life insurance markets and outlines exactly what it takes to capture the opportunities that are emerging. Drawing on the research and experience of the McKinsey Asia financial services team, it includes everything you need to know about the battle for the life insurance market in Asia.
* Looks at how China and India are becoming increasingly important players on the international life insurance scene
* Goes behind the scenes of the Asian life insurance industry and the contentious battle for market share
* Outlines the steps to successfully entering, and prospering, in the Asian market
The life insurance industry in Asia is changing like never before. What the future holds, no one knows, but with Life Insurance in Asia in hand, you'll have a clear idea of the factions in play and the rules of the game.
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Persons
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.
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.
Content
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
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