Insurance gives high net worth individuals more control over their wealth and offers a set of tools that are attracting more attention in the industry, according to Sun Life Financial.

Life insurance allows one to save, invest, and pass on wealth to the next generation, and as such is an important part of the wealth management toolbox.

In Asia, this is not so much about avoidance of tax as it is about tapping into a variety of products and trust in a brand name. This, at any rate, is the view of a prominent executive at Canada's Sun Life Financial, an insurer with a presence spanning over a century in Hong Kong.

Roger Steel, president of new markets and business development at the insurance group, is buoyant about the growth potential for life insurance in Asia and is ramping up investments in Asian markets, attracted by its demography and wealth creation trends.

The market expansion push follows a diverse approach to reflect the variety of development stages of capital markets and differences in demographics of each country in the region, through training, product sophistication, and acquisitions.

"Although the growth per capita has a bit to go, ASEAN is very attractive because of the demographic growth as well as the strong savings culture,” Steel told this publication. Sun Life's product mix across the region is tilted towards investment products - in particular unit-linked life insurance.  

"We like these products in all our markets because they provide our mass market and upper affluent clients with affordable access to a wide range of investment funds, ideal for regular savings and wealth accumulation,” Steel said.

“We focus on the mass and upper affluent markets, since this is the real engine of growth in the economies we serve,” he continued.

Steel has been working to implement real-time underwriting for clients with the acquisition and imminent deployment of new software and enhanced training of insurance advisors.

The company's software, SunSmart, will have tailored platforms for each market it has stepped into - Hong Kong, Philippines, Indonesia, Malaysia, Vietnam - and offer enhanced support to advisors as they assess clients' needs and choose products to cover those needs.  

While equipping staff with the right tools is essential to Sun Life, the insurer also aims to raise professional standards and for its field staff to earn a reputation as the "most respected advisors".

Enhanced professional standards for advisors in emerging markets
The group has just invested $40 million in Indonesia to hire and train advisors. “This includes the utilisation of social media and digital technology to enhance our brand’s exposure,” said Steel.

“Using technology to engage the online population is very critical because the population matches our target demography in terms of age, education and income,” he said.

Some 30,000 employees have started working at Sun Life in the country over the past three years. Advisors will be able to carry out on-site assessments of future policyholders’ needs, thanks notably to the new platform that is in the process of being rolled out.

“What we want to avoid is a back and forth lengthy process from a relationship manager to decision takers,” said Steel.

Stemming from the same idea that client education is a prerequisite for business growth, in the Philippines the financial literacy campaign has been a successful way to engage with potential clients and has turned opportunities into considerable market share expansion - from 16.7 per cent in 2009 to 22.8 per cent in 2015.

“We have seen an increasing number of young people buying products, attending seminars and even becoming agents of Sun Life,” said Steel.

In 2009 the company launched the “It’s Time!” financial literacy advocacy, and in June 2013 it relaunched the financial literacy programme through the “Brighter Life” campaign. This was followed in 2016 by “Brighter Life Praxis”, a board game designed to stimulate conversations on finance and investment.

Sun Life veteran Rizalina Gervasio Mantaring, who has been chief executive and president of the insurer’s Philippines business since 2009, is described by her peers as the backbone of the achievement, thanks to her insight into the local culture.

The company’s strategy has also been to offer accessible products through its Variable Universal Life product to adjust to a nascent market where recent economic growth is a strong pillar for insurance purchase pick-up.

Sophistication in a competitive environment
In Hong Kong’s highly competitive market, the issue is better distribution and more products on offer, said Steel.

Sun Life Financial has been licensed to manage assets and is boasting an open architecture investment platform, a convincing edge on competition.

“We have a fund of funds approach which gives our clients reassurance should one fund underperform, and what distinguishes us on the market is our ability to hire the best managers on the market,” said Steel.

Six months ago Sun Life Financial moved from a single manager scheme, as it lacked this flexibility.

The two top performers so far are First State Equity Fund and Schroder Investment Management’s MPF Master Trust Scheme, which as at 31 March this year had HK1.3 billion (around $167.6 million) of assets under management.

The MPF HK equities fund offered by Sun Life and managed by First State is the only one available under an MPF scheme.

MPF net inflow market share numbers from the Hong Kong pension business grew from 5.4 per cent in 2011 to 10.1 per cent in 2015, and the firm is hoping to increase this pace with the new suite of products.

In time, Sun Life wants to bring the complete suite of investment products it offers in Canada and the US to Asia, especially with regards to products in the real estate sector, currently provided by Bentall Kennedy in the group’s home country. 

Spreading across the region

This year the group has made further strategic moves in Vietnam and Hong Kong.

Vietnam, in particular, is believed to offer a lot of scope for growth. With Sun Life increasing its equity ownership in the joint venture with PetroVietnam, PVI Sun Life Insurance Company, from 75 per cent to 100 per cent just a week ago, the new entity is harnessing the momentum achieved by one of the fastest-growing economies in Asia in recent years.

Another indicator of the group’s faith in Vietnam’s potential is the appointment in September this year of Larry Madge, the group’s global chief actuary. The Vietnamese branch now ranks as the sixth largest life insurance provider in the country and an industry pioneer in pensions.

Anne-Sophie Briant-Vaghela is a journalist based in Hong Kong.