Hong kong: Hong Kong's non-life insurance industry has demonstrated 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.
According to BERNAMA News Agency, the global credit rating agency noted that accident and health (A and 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 percent of Hong Kong's non-life segment GWP of HK$100.5 billion (US$12.9 billion) in 2024.
The report highlighted the industry's overall operating profit, which 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 percent of the market's total underwriting profit.
AM Best senior financial analyst, Stephanie Mi, stated that factors such as increased consumer awareness, ongoing regulatory initiatives, and the development of the Guangdong-Hong Kong-Macao Greater Bay Area project are driving the overall performance of Hong Kong's non-life market. 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 indicated that the direct non-life segment remains highly competitive, with no single insurer holding more than a 10 percent market share. The non-life segment has maintained a generally stable momentum, recording GWP growth of around three to eight percent annually from 2020 to 2023.
A and H insurance continues to be an area of growth, driven by rising demand for travel insurance and group medical coverage, particularly in the post-pandemic period. However, AM Best cautioned that moderate economic expansion combined with external headwinds could increase capital market volatility, potentially affecting asset prices and financial stability.