SINGAPORE - Insurer AIA Singapore is spreading its wings with a more than $20 million investment, so it can swoop in on a burgeoning group of affluent clients in the region who are expected to give a significant lift to its business in time to come.
The insurer told The Straits Times that it has committed the sum as an initial investment to drive its new wealth outfit, and that it “will continue to devote sufficient resources” to realise the growth potential of the affluent and high-net-worth market segments.
The new outfit, comprising a wholly owned AIA International Wealth and a physical wealth centre in the Central Business District, caters to domestic and regional individuals with deep pockets.
AIA said it is looking at affluent clients who have a minimum of $200,000 in assets under management.
“The Asia affluent population is slated to grow to 28.2 million by 2026 and that’s a huge flow,” Ms Peggy Quek, chief executive of AIA International Wealth, told ST in an exclusive interview ahead of the launch of the company on April 30.
In 2021, the Asian affluent population was at about 17.5 million.
Singapore, a strong offshore hub with large capital flows, is projected to benefit from the growing trend, with the number of high-net-worth individuals here expected to rise by 12 per cent to 592,000 by 2026.
The high-net-worth segment has been an increasingly prominent contributor to AIA Singapore’s business, growing by double digits over the past three years and outpacing the rest of the business.
The insurer had started with a domestic customer base before moving to capture offshore clients through partners or insurance agents.
Ms Quek, 55, said the idea to further the insurer’s wealth strategy was mooted post-pandemic in 2022.
“With this set-up, the International Wealth Division, over time, should be a significant player or significant part of AIA Singapore’s regional offshore wealth volume,” she said.
The new division is the second such team that serves international clients – the first was set up in Hong Kong, where the AIA Group is listed.
Asked about competition from many other traditional finance firms and even digital asset players, Ms Quek said: “The pie is very large, and we’re talking about insurance solutions.
“There will be many customers out there who haven’t had the conversation of how they transfer their wealth because it’s a tough conversation.”
The new outfit that Ms Quek is building from scratch will have about 30 staff by the end of the year, with about half of them in the role of salaried wealth management consultants.
It will work with regional institutional partners including banks, family offices, consultancy firms and asset managers to bring in clients.
Besides traditional wealth and legacy planning, customers have access to a panel of experts in areas such as tax, trust and legal, Ms Quek noted.
The products offered by the international wealth team will be underwritten in Singapore but based on where the clients reside.
“The amounts we underwrite tend to be bigger, and the benefits and features are more complex – so this comes with experience and the structure against which we can put the products together. These solutions are typically not easily and readily available in the (retail market) in the same form,” said Ms Quek.
For now, the wealth team has selected a dozen legacy planning, wealth planning, accident and health plans from the insurer’s suite of products.
The new wealth centre located at Six Battery Road is accessible only by invitation.
The pan-Asian life insurance group has a footprint in 18 markets including mainland China, Hong Kong, Thailand and Malaysia.
First established in Shanghai in 1919, the group has total assets of US$286 billion (S$389 billion) as at end-December 2023.
The mainland and Hong Kong make up more than half of the group’s business, its annual results showed.
In 2023, AIA Singapore clocked a 10 per cent increase in value of new business – a measure of expected profits from new premiums – to US$394 million, led by agency and partnership distribution channels.
