The number of financial institutions that receive approval to operate in the local market has been growing significantly. In 2022 eight new such entities commenced operation in Macau, the Monetary Authority of Macao (AMCM) has revealed in a written reply to a Times inquiry.
According to detailed information also provided by AMCM, among the eight new financial operators are a branch of a bank incorporated overseas, two insurance companies, two financial leasing companies, a cash remittance company, an investment fund management company and a financial asset trading company.
When compared year-on-year with the previous period, 2022 saw a spike of 400% in the number of new entities, and there were only two new financial institutions authorized to operate in Macau including a bank incorporated in Macau and a branch of a bank incorporated overseas, the AMCM also noted.
Among the new financial services being promoted by the new companies are life insurance and other savings investment products.
As the Times reported earlier this year, according to a report from the Swiss Re Institute on “World insurance: inflation risks front and center,” Macau was reported as having good potential for life insurance promotion products as the life insurance penetration rate (in 2021) was just of 6.4%, which represented slightly over one-third of the one in the neighboring region of Hong Kong’s (17.3%).
This fact is of interest to companies that have already a large experience in the Hong Kong market.
Likewise, earlier this year, and as the Times also reported, the Hong Kong arm of the multinational insurance company headquartered in London – Prudential plc (Prudential) – announced that following approval by the local authorities, it would establish a branch of its Hong Kong business in Macau.
The company announced that in the first phase, it would offer life and health insurance solutions, including multi-currency options to meet different customers’ needs such as savings packages as well as healthcare and protection.
Adding on the conclusion of the report from Swiss Re Institute, the Managing Director, Strategic Business Group, of Prudential, Lilian Ng, said at the time that while there has been rapid economic development in Macau in the past few years, the insurance penetration remained low despite the city’s fast-ageing population creating potential demand.
Figures from the AMCM also noted that life insurance premiums in Macau have already registered a growth of 26% year-on-year (in 2021) to MOP 33 billion also driven by the Covid-19 pandemic.
Additionally, the new Islands Medical Complex, to be operated in a public-private partnership system, is set to start operations at the end of this year and, as it has been announced, potentially many of its services will fall under a private hospital management system for which, the acquisition of health insurance is the most viable solution to avoid facing hefty medical bills.
Dah Sing Bank and Sun Life bancassurance deal does not apply to Macau
In late January this year, Hong Kong’s Dah Sing Bank announced a 15-year exclusive bancassurance partnership in Hong Kong with Canadian Sun Life Financial Inc. aiming to make available a series of insurance and financial services packages from the Canadian insurer to Hong Kong.
Such a package will not extend to Macau, at least not for the time being, a fact confirmed to the Times by a spokesperson from local Banco Comercial de Macau, S.A. (BCM) a subsidiary company of Dah Sing Banking Group Ltd.
Under the Bancassurance Partnership, Sun Life will be the exclusive provider of life insurance solutions to Dah Sing Bank’s 570,000 retail banking customers on savings and protection products. The partnership combines Sun Life’s suite of life and health insurance solutions. It is forecasted that Sun Life products will be available by July 2023.
