HONG KONG - One of the biggest sources of demand for Hong Kong insurance products is drying up as the city's summer of unrest deters Chinese buyers.
Chinese customers have long flocked to Hong Kong for insurance sold by the likes of Prudential Plc and AIA Group Ltd, in part because the products offer an investment component and payouts in foreign currencies that are hard to come by on the mainland. In one sign of how big the issue has become for insurers, Prudential this month arranged mobile processing centres in conference rooms at a hotel near Hong Kong's airport, allowing visitors to sign their contracts without venturing into the city, according to a company memo seen by Bloomberg News.
The risk for Hong Kong's insurance industry is that an enduring period of unrest undermines the city's reputation as a safe and reliable provider of financial services. The protests have thrown a wrench in what Hong Kong insurance agents - some of whom quit careers in banking to join the lucrative industry in recent years - had expected to be a strong 2019.
Instead, Chinese buyers have stayed at home as protesters blocked roads and clashed with police in districts such as Tsim Sha Tsui and Causeway Bay, where many insurers operate customer-service centres catering to tourists.