Hong Kong Insurance Offshore Market Analysis Joint Regional Seminar Taipei

Agenda HK Insurance onshore and offshore at a glance Top 5 insurance companies in offshore business Available products for offshore business Note : The information used is based on public information from OCI Hong Kong statistics, however speaker is responsible for the accuracy and any implication derived from the OCI Hong Kong statistics

Single Revenue Premiums 2014 -2016 Q1 comparison（HK$‘000） New Business Single Revenue Premiums Annualised Premiums Total Onshore Offshore 2016 Q1 16,144,131 7,942,279 8,202,052 22,401,354 12,995,209 9,406,145 49% 51% 58% 42% 2015 Q1 21,192,403 13,497,469 7,694,934 15,168,791 10,437,252 4,731,539 64% 36% 69% 31% 2014 Q1 13,968,918 8,677,996 5,290,922 13,227,120 9,603,786 3,623,334 62% 38% 73% 27%

Single Revenue Premiums 2014 -2015 Full Year vs. 2016 Q1（HK$‘000） New Business Single Revenue Premiums Annualised Premiums Total Onshore Offshore 2016 Q1 16,144,131 7,942,279 8,202,052 22,401,354 12,995,209 9,406,145 49% 51% 58% 42% 2015 Full Year 63,732,581 36,186,295 27,546,286 67,122,606 44,648,513 22,474,093 57% 43% 67% 33% 2014 Full Year 60,007,415 35,821,052 24,186,363 53,577,763 38,053,688 15,524,075 60% 40% 71% 29%

Single Revenue Premiums Average per policy (HKD) 2016 Q1 Average Premium Size Single Revenue Premiums Annualised Premiums Total Onshore Offshore (HKD’000) 16,144,131 7,942,279 8,202,052 22,401,354 12,995,209 9,406,145 49% 51% 58% 42% Number of policies 12,095 9,301 2,794 263,633 186,390 77,243 77% 23% 71% 29% Average per policy (HKD) 1,334,777 853,917 2,935,594 84,972 69,270 121,773

Single Revenue Premiums Average per policy (HKD) 2015 Full Year Average Premium Single Revenue Premiums Annualised Premiums Total Onshore Offshore (HKD’000) 63,732,578 36,186,295 27,546,283 67,122,606 44,648,513 22,474,093 57% 43% 67% 33% Number of policies 38,391 32,940 5,991 1,173,929 906,614 267,315 85% 15% 77% 23% Average per policy (HKD) 1,660,091 1,098,551 4,597,944 57,177 49,247 84,073

Top 5 insurance companies in offshore business Market Share of Top 5 in single premium and regular premium Average premium size Distribution

2015 Top 5 offshore Single Revenue Premiums Annualised Premiums HKD (,000) Policies Average (HKD) Premiums (HKD’000) 1 Top 5 20,200,366 4,710 4,250,608 19,752,622 226,155 87,341 73% (offshore market) 79% (offshore market) 88% (offshore market) 85% (offshore market) 2 Highest Average 3,708,437 168 22,074,030 Highest number of policies 8,305,749 114,240 72,704 13% (offshore market) 3%(offshore market) 37% (offshore market) 43%(offshore market) 3 Lowest Average 2,861,887 2,457 1,164,789 Lowest number of policies 1,890,483 5,464 345,989 10% (offshore market) 41% (offshore market) 8% (offshore market) 2% (offshore market)

2015 Top 5 , 2016 Q1 Performance in Offshore Single Revenue Premiums Annualised Premiums Premiums HKD (,000) Policies Average (HKD) Premiums (HKD’000) 1 Top 5 5,708,533 2,353 2,426,066 8,179,618 67,363 121,773 70% (offshore market) 84% (offshore market) 87% (offshore market) 2 Highest Average 423,587 41 10,331,390 Highest number of policies 3,372,502 37,463 90,002 5% (offshore market) 1%(offshore market) 36% (offshore market) 49%(offshore market) 3 Lowest Average 1,833,463 1,653 1,109,173 Lowest number of policies 1,238,793 1,198 1,034,051 22% (offshore market) 59% (offshore market) 13% (offshore market) 2% (offshore market)

2016 Q1 Top 5 in Offshore Single Revenue Premiums Annualised Premiums HKD (,000) Policies Average (HKD) Premiums (HKD’000) 1 Top 5 5,977,300 2,420 2,935,595 8,219,684 60,305 136,302 73% (offshore market) 87% (offshore market) 78% (offshore market) 2 Highest Average 643,887 46 13,997,543 Highest number of policies 3,372,502 37,463 90,002 8% (offshore market) 2%(offshore market) 36% (offshore market) 49%(offshore market) 3 Lowest Average 1,833,463 1,653 1,109,173 Lowest number of policies 1,238,793 1,198 1,034,051 22% (offshore market) 59% (offshore market) 13% (offshore market) 2% (offshore market)

2015 Top 5 (total company basis) Single Premium 2015 Agents(excluding banks) (b) Banks  (c) Brokers Total company Average Premium (HKD) Number of Policies Offshore Premium% Offshore Policies % 1 Top 5 (together) 759,428 11,268 1,456,265 6,972 9,658,661 1,759 56% 24% 2 Highest Average - 20,231,938 351 58% 53% 3 Lowest Average 669,423 5,774 1,036,064 1,554 820,126 1,189 44% 29% 4 Other than Top 5 742,042 4,287 1,574,975 11,797 3,835,133 1,532 27% 7% Annaulised Premium 2015 Agents(excluding banks) (b) Banks  (c) Brokers Total company Average Premium (HKD) Number of Policies Offshore Premium% Offshore Policies % 1 Top 5 (together) 33,592 568,493 216,796 119,949 86,143 55,019 40% 30% 2 Highest number of policies 47,310 195,345 120,493 20,602 94,502 20,781 61% 48% 3 Lowest number of policies 29,603 23,607 248,257 54,760 643,995 1,402 12% 7% 4 Other than Top 5 23,292 236,538 85,903 111,759 68,705 27,389 16% 11%

2015 Top 5 , 2016 Q1 performance (total company basis) Single Premium 2015 Agents(excluding banks) (b) Banks  (c) Brokers Total company Average Premium (HKD) Number of Policies Offshore Premium% Offshore Policies % 1 Top 5 (together) 862,252 3,159 1,812,189 1,592 3,861,042 958 61% 41% 2 Highest Average - 7,668,129 41 66% 89% 3 Lowest Average 980,490 1,870 1,193,090 178 903,373 748 67% 59% 4 Other than Top 5 126 5,185 332 38% 8% Annaulised Premium 2015 Agents(excluding banks) (b) Banks  (c) Brokers Total company Average Premium (HKD) Number of Policies Offshore Premium% Offshore Policies % 1 Top 5 (together) 44,927 118,127 270,201 28,549 127,861 19,572 53% 41% 2 Highest number of policies 60,442 47,491 118,982 5,348 116,439 8,774 74% 61% 3 Lowest number of policies 33,053 3,889 365,013 11,112 985,856 362 27% 8% 4 Other than Top 5 23,306 45,089 151,534 34,151 105,992 5,489 18% 12%

Popular products in offshore market Types of product Medical Critical Illness Wealth Management (Universal Life, Unit Linked Life) Medium to long term saving (Endowment, Participating)

Why buying by offshore customers Medical Access to Out-of-Country medical care More economical terms Richer coverage Critical Illness Product variations Definition of critical illness Wealth Management (Universal Life, Unit Linked Life) Geographical and currency diversification Medium to long term saving (Endowment, Participating) More global product exposures and investment

Going forward Regulatory and governance tightening? Domestic markets getting more competitive? Offshore customers protection and rights? Implication on internet marketing? Globalisation of healthcare and financial products?