HONG KONG, 29 July 2015 – Asia’s protection gap - measured as the difference between the resources needed and the resources already available for dependents to maintain their living standards in the unfortunate event that a working family member is no longer able to provide – has grown further according to a new report1.
The report, from Swiss Re, estimates that the mortality protection gap for the region widened further between 2010 and 2014. The size of the gap increased to US$58 trillion in 2014 from US$42 trillion in 2010 for the 13 Asia-Pacific 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 current gap equals about 6.6 times the current amount of life insured in the markets in the report.
Based on current trends, AIA estimates that the gap will continue to grow and increase to a total of US$82 trillion by 20202 . In terms of some specific markets, AIA estimates the figures will grow to US$763 billion in Hong Kong, US$570 billion in Singapore, US$46 trillion in China, US$12 trillion in India, US$1.1 trillion in Indonesia, US$528 billion in the Philippines and US$1 trillion in Thailand. 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.
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.
“Taking insurance to protect future earnings and lifestyle should be a higher priority for consumers in the region. More needs to be done to further increase the awareness of the benefits of insurance protection to the general public. This is a priority for Citi in Asia, and in partnership with AIA we are confident that we can offer our clients the solutions they increasingly need to protect themselves for the future,” said Anand Selvakesari, Head of Consumer Banking Asia Pacific.
“Asia is increasingly underinsured with a widening protection gap. As the leading life insurance group in the region, 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.
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