Hoping to turn a crisis into an opportunity
Fear and worry may prevail in many Hong Kong businesses as the global financial turmoil grips the local economy, but senior insurance consultant Samuel Yung is optimistic about his industry's growth.
'Only one or two of my clients terminated their insurance policies recently, not because of the financial crisis, but because their policies had reached maturity,' he said. A 26-year industry veteran, he said people held more cash during tough times, and demands for insurance could even rise because they needed more protection against risks.
'During the 1987 stock market crash, the 1997 Asian financial crisis and the 2003 Sars pandemic, both my own businesses and those of my team kept going up,' he said. 'After 1997, even more people bought insurance. They would think: my property and stock prices have all plummeted. What can I count on to take care of my family?'
Mr Yung said insurance agents' morale was good. At least they did not have to worry about unemployment because they had no employment relationship with companies. To turn the crisis into opportunity, he has been seeking new talent. 'When other sectors lay off staff and cut pay, it is a good time for us to expand our talent pool ... I just recruited a top candidate, who formerly worked as a senior executive at a media firm.'
He predicted that the sector's revenue for the last quarter of the year would drop substantially, and growth for next year would be slow, but remained confident the impact would be only short-term.
Mr Yung said, however, that the non-traditional insurance market would be challenged as a result of the financial crunch. 'Since 2000, fund-linked insurance had grown rapidly here as the investment market boomed ... but now many dare not put their money in investments.'.
In the next one or two years, the industry would go back to a traditional insurance model. 'People will continue to buy life, critical illness, medical and accident insurance. But this will be only short-term. When the financial market revives, investment-linked insurance will prosper again.'
