Recent agreement to acquire AXA Insurance Pte Ltd (AXA Singapore) by HSBC Insurance (Asia-Pacific) Holdings (HSBC Insurance) demonstrates the continued growth potential of Singapore’s life insurance segment. HSBC’s Acquisition of AXA Singapore Highlights Singapore Life Insurance Growth Prospects. Demand for long-term financial planning and health protection is continuing to support Singapore’s life insurance market prospects. HSBC Insurance-AXA Singapore deal takes place at a time when the Singapore life market has seen a strong rebound in weighted new business premiums recorded in the first half of 2021. In addition, recent and future life insurance growth is expected to be supported by the city-state’s attractiveness as a home for affluent and high-net-worth individuals.
Life insurance companies with international expertise in investment and wealth management have notable advantages in designing sophisticated products with more attractive investment terms and features—an important value proposition amid the current low-interest-rate environment. Nonetheless, life insurers with product offerings that include significant investment risks/guarantees must balance the attractiveness of these products with the capital requirements that arise for the insurer. In Singapore, aside from group health business, which delivered adequate profitability in 2020, health insurance is viewed as a difficult line of business due to the weak results of long-term individual policies.