29 August 2022
The Insurance Authority (IA) today (29 August 2022) published findings of the Insurance Literacy Tracking Survey (Tracking Survey) 1 , which is a project devoted to assessing the knowledge, skills, attitude, and behaviour of people in Hong Kong when they make important decisions related to personal insurance.
In overall terms, the score of 52% represents moderate level 2 of literacy for the territory. Regarding knowledge and skills, respondents showed a broad understanding on the principles of insurance and some common product features but possessed inadequate knowledge on risk exposure and protection needs. The score of attitude is 54%, with respondents generally agreeing that insurance is important for everyone as a risk management tool. Over half of them trusted the advice tendered by insurance intermediaries and believed that insurance companies are addressing their needs when doing business. Nonetheless, they found it difficult to select between different products due to choice and information overload.
The score on behaviour is 48%, showing heavy reliance on the advice of family members and friends as a trustworthy source of information. Among those who are policy holders, less than half made an attempt to compare insurance products supplied by different companies before making a purchase, whereas one in five neither studied into the detailed terms and conditions nor pored over the product brochures. Non-policy holders are far less literate than policy holders, as they downplayed the efficacy of insurance and shied away from acquiring it for protection.
Findings of the Tracking Survey also indicated that insurance literacy varies at different stages of life. Youth 3 is the group getting the lowest score of 40%, with a majority of respondents acknowledging the need for insurance but less than one in 10 learnt about this subject at school.
“Insurance literacy and financial inclusiveness are twin-drivers of social resilience and sustainable growth of the insurance industry. The more inclusive the insurance market is, the better it can create social synergies. We must act now to enhance insurance literacy,” said Mr Clement Cheung, Chief Executive Officer of the IA.
“Riding on the Public Education Campaign on Lifetime Risk Profiling rolled out last year, we will step up efforts to inculcate the younger generation with correct knowledge about insurance and its value to society,” he added.
Mr Cheung appealed to the industry for realising the role that should be played by insurance in offering appropriate and affordable protective insurance products to assist people in managing their evolving risk exposures.
A full set of reports related to the Tracking Survey together with a synopsis are available on the IA website .
Ends
Notes:
1 The Tracking Survey was conducted through face-to-face street intercept interviews of 1,009 Hong Kong residents aged between 18 and 79 in November 2021.
2 The scoring mechanism draws reference from a similar framework implemented by the Organisation for Economic Co-operation and Development.
3 Youth refers to those aged between 18 and 24, single and currently studying, with limited or no experience in full-time employment.