Hong Kong Faces HKD 6.9 Trillion Protection Gap: Comparison of High-Coverage Life Insurance from 3 Major Companies

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A recent research report released by the Insurance Authority revealed that, despite Hong Kong having the highest insurance density (per capita premium) and penetration rate (premiums as a percentage of GDP) globally, the overall death protection gap amounts to a staggering HKD 6.9 trillion. In other words, if the breadwinner of a family unfortunately passes away prematurely, the family's daily life could be severely impacted.

To address the death protection gap, term life insurance is more cost-effective for shorter-term coverage. However, if policyholders seek longer-term protection, we have observed that three major local insurance companies have launched high-protection whole life insurance products this year. These are "AIA Joyful Life Protection Plan" (AIA Joyful), "Manulife Superior Whole Life Protection" (Manulife Superior), and "Prudential Future Autonomy Protection Plan" (Prudential Autonomy). Policyholders should note that even if they recognise the need to purchase life insurance to bridge the death protection gap, they must compare product details carefully.

Using the death risk protection gap assessment tool provided by the Insurance Authority, we evaluated the death protection gap for a 35-year-old non-smoking father. Assuming he earns HKD 30,000 per month, his wife also has a full-time job, and they each contribute half of the household expenses, with a 6-year-old son and a pair of recently retired parents to support. Their family savings amount to approximately HKD 2 million, with an additional HKD 500,000 in retirement funds.

If he unfortunately passes away, given the responsibility of "supporting elderly parents and young children," the tool estimates his death risk protection gap to be HKD 2.95 million (approximately USD 380,000). Having an appropriate life insurance policy can help prevent financial hardship for the family in the event of premature death.

1. Differences in Death Benefit Amounts

Comparing "AIA Joyful," "Manulife Superior," and "Prudential Autonomy," we noted differences in guaranteed death benefits from age 35 to 99 under the same payment term (10 years) and annual premium (USD 10,000). Among them, "Prudential Autonomy" offers the highest guaranteed death benefit at USD 295,334, followed by "Manulife Superior" (USD 263,749) and "AIA Joyful" (USD 263,227).

As for the expected total death benefit (including non-guaranteed components), using age 65 as an example, "Prudential Autonomy" provides better coverage at USD 570,945, followed by "Manulife Superior" (USD 451,081) and "AIA Joyful" (USD 420,058) (see Table 1).

It is worth noting that all three life insurance products offer different death benefit payout arrangements, including a lump sum or monthly instalments to the designated beneficiary.

Table 1: Comparison of High-Protection Whole Life Insurance from 3 Major Insurance Companies

Item (USD)	友邦樂怡人生	宏利優越終身保	保誠自主未來
Payment Term	10
Annual Premium	$10,000
Total Premium Paid	$100,000
Guaranteed Death Benefit
Age 35 to 99	$263,227	$263,749	$295,334
Expected Total Death Benefit
Age 65	$420,058	$451,081	$570,945
Age 85	$865,938	$926,662	$1,413,909
Guaranteed Cash Value
Age 65	$118,163	$102,838	$55,700
Age 85	$136,194	$102,838	$295,334
Expected Total Cash Value
Age 65	$274,993	$290,170	$331,311
Age 85	$738,905	$765,751	$1,413,909
Note: 1. Based on a 35-year-old non-smoking male. 2. Data as of 3 December 2021.

2. Comparison of Surrender Cash Value

These life insurance products include a savings component, allowing policyholders to receive guaranteed and expected cash values upon surrender. At the 50th policy year (age 85), the guaranteed cash value of "AIA Joyful" (USD 136,194) and "Manulife Superior" (USD 102,838) is only slightly higher than the premiums paid but significantly lower than the guaranteed death benefit. Therefore, if the intention is to leave this sum to the next generation, surrendering the policy may not be the most beneficial option.

For "Prudential Autonomy," the guaranteed cash value and death benefit are both USD 295,334, meaning that if an older client feels they no longer need life insurance coverage, surrendering the policy will not result in a loss.

As for the expected total cash value at age 85, "Prudential Autonomy" stands at USD 1,413,909, while "Manulife Superior" and "AIA Joyful" are at USD 765,751 and USD 738,905, respectively.

3. Longer Payment Terms Make It More Affordable

The above example is based on a 10-year payment term. In reality, all three whole life insurance products allow the payment term to be extended. "Prudential Autonomy" offers a payment term of up to 30 years, while "AIA Joyful" and "Manulife Superior" extend up to 25 years.

For protection-oriented products, the longer the payment term, the higher the death benefit multiple in the early years, making such products generally more affordable for consumers.

4. Certain Products Offer "Inflation Protection" Options

Additionally, inflation may erode the effectiveness of death protection. Therefore, "Prudential Autonomy" and "Manulife Superior" offer "inflation protection" options, allowing clients to pay additional premiums to increase the sum assured without undergoing further underwriting, helping to hedge against inflation. For "Prudential Autonomy," if a 20-year or 30-year payment term is chosen, additional premiums can automatically increase the sum assured by 5% annually, up to a maximum of 200% of the initial sum assured.

For "Manulife Superior," the "inflation protection" option applies to payment terms of 10 years or longer, allowing policyholders to pay additional premiums to increase the sum assured by 10% annually, up to a maximum of 100% of the initial sum assured.

5. Eligible for Policy Reverse Mortgage Programme

Furthermore, all three insurance products are eligible for the Policy Reverse Mortgage Programme. Policyholders can use their life insurance policy as collateral to apply for a reverse mortgage loan from a lending institution, converting the death benefit into a cash flow received as a monthly annuity.

Lastly, it must be emphasised that even if individuals already have savings or life insurance, it does not necessarily mean they have adequate or ideal coverage. Ultimately, purchasing whole life insurance requires understanding one’s death protection needs rather than focusing solely on returns. Policyholders should also compare product details to find cost-effective options.

Note:

1. The above premiums do not include the levy collected by the Insurance Authority.

2. Data as of 3 December 2021.

Appendix 1: Overview of Whole Life Insurance from 3 Major Insurance Companies

	友邦樂怡人生	宏利優越終身保	保誠自主未來
Payment Term Options	5 years, 10 years, 25 years	Single Pay, 5 years, 10 years, 20 years, 25 years	Single Pay, 10 years, 20 years, 30 years
Death Benefit Payout Method	Lump Sum or Instalments	Lump Sum or Instalments	Lump Sum or Instalments
Option to Pay Additional Premiums to Increase Sum Assured for Inflation Protection	✗	10-year payment term or above, Annual increase of 10%, 100% cap	20-year or 30-year payment term, Annual increase of 5%, Up to 200% of initial sum assured
Guaranteed Death Benefit at Age 85	136% of premiums	103% of premiums	295% of premiums
Eligible for Policy Reverse Mortgage	✓	✓	✓
Note: Data as of 3 December 2021.

This English version of this article has been generated by machine translation powered by AI. It is provided solely for reference purposes. In the event of any discrepancy or inconsistency between this translation and the original Chinese version, the Chinese version shall prevail.

Last updated: 9 Apr 2026

10Life Editorial Team

Our team of professional content researchers focussing on insurance

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10Life Editorial Team

Our team of professional content researchers focussing on insurance

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