香港保监局 香港保险认知研究2021

保險業監管局InsuranceuthorityContents1.IntroductionAnnex3:Scoringmethodforthequestionon44Annex4:KeydemographicprofileoftheAnnex6:EstimationofperceptionggoodmarketconductandethicalInsuranceliteracyisacombinationofknowledgeandskills,attitudeandbehavioursnecesssounddecisions,thuscontributingtobetterinsuranceinclusion.Inaninclusivemarket,allcitizens—includingtheunservedandundtheInsuranceAuthority’s(“IA”)policydevelopmentandpubliceducation,theIAhasconductedanEconomicCo-operationandDevelopment’s(“OECD”)frameworkformeasuringfinancialliteracy.SurveyquestionswerealsoadaptedtothecontextofHongKong,withthecharacteristicsoftheHongKonginsurancemarketbeingtakenintoconsideration.Thesurveyfindingsshowedthatrespondentswereratedas‘moderatelyliterate’inoverallinsuranceliteracy;‘moderatelyliterate’inknowledggeneralunderstandingaboutpolicyholders’rights,insuranceprinciplesandproductfeatures,butlimitedknowledgeofriskexposureandprotectionneeds.Theperceivedvalueoverload.Identifiedbehaviouralissuesinclude:over-relianceontheadviceandexperienceoffamilyorfriends;procrastinationindealingwithinsurance;limitedpolicycomparison;focusonpromotions;andinadequatereadingoftermsandconditions.ApositivecorrelationbetweeninsuranceliteracyaNon-policyholdershadsignificantlylowerlevelsofinsuranceliteracythanpolicyholders.Somecommonpatterns,whichmaycontributetonon-policyholdersunder-engagingwithinsurance,wereobsinclude:lowerperceivedvalueofinsurance;lackoftrustintheinsurancesector;lackofinsuranceknowledgeandconfidenceininsuranceknowledge;andlackofawarenessoflifromoverallliteracyandfindingsonnon-policyholders,product-specificfindingswerealsoexplored.TheILTSposedquestionsforthegeneralpublic,theinsurancesectotheinsuranceliteracyoftheHongKongpopulation.Allstakeholdersarerecommendedtoworktogethertodevelopsolutions,closetheknowledgegapandaddressattitudeandbehaviouralbiases.1.INTRODUCTIONInsuranceisariskmanagementandmitigationmechanismsafeguardingpeopleagainstfinanciallosses.Itcreatessocialvaluebyprovidingasenseofsecurityandpeaceofmindtoindividuals,relievingtheburdenongovernmentsofofferingsocialsecuritybenefits,andsupportingbusinessandeconomicgrowthbyfosteringinnovationandmoreefficientcapitalallocation.1Thesocialvalueofinsurancedependsonthelevelofinsuranceinclusion.Bythis,wemeantheunservedandunderserved,includingvulnerableandlow-incomepopulations,shouldhaveaccesstoanduseofappropriateandaffordableinsuranceproducts.2Themoreinclusivetheinsurancemarketis,theEconomicCo-operationandDevelopment(“OECD”)foundthatthereisacorrelationbetweenfinancialinclusionandfinancialliteracy(AtkinsonandMessy,2013).InadequateknowledgeandInthisreport,insuranceliteracyisdefinedasacombinationofknowledgeandskawarenessinrelationtoinsuranceandriskexposurefacilitatespeople’schoiceofappropriateinsurancesolutions.Trustininsurancedrivespeopletotakeoutinsurance.Ontheotherhand,individualswithoutsufficiinsuranceliteracybetweennon-policyholdersandpolicyholderscanhelpusidentifybarrierstoinsurancetake-upandformulateTheinsurancemarketinHongKongismature,asreflectedbyhighinsurancepenetrationandappropriateoradequateprotection.Inlifeinsurance,the“mortalityprotectiongap”—ortheshortfallinfinancialresourcesneededtosustainadecentlivingstandardforsurvivingfamilyInsurancepenetratioinsurancepremiumstototalpo3membersintheeventofabreadwinner’sprematinHongKongin2019.4Thissizeablegapindicatesthatpolicyholdersarenotpurchasingtheappropriatelifeinsuranceproductstosatisfytheirprotectionneeds.Turningtonon-lifeinsurance,almost80%ofrespondentstoonesurveydidnotpurchasehomeinsurance.Around60%ofrespondentsbelievedthatthecostofalternativeaccommodationandtemporarystorageoffurniturewouldbecoveredbyfireinsHongKongpeopledonothaveadequateandappropriateprotectionagainstpropertyandcasualtythe349complaintsthatwereclosed,theapplicationofpolicyterms,excludeditemsandnon-disclosureaccountedfor86%ofcomplaints.6ThissuggeststhatbetterinsuranceknowledgeandawarenesscanhelptheHongKongpublictobetterunderstandproducts,andresultintheirmakingbetterdecisions.•Insuranceproductsandcontractsaretoocomplicatedforcustomerstounderstand.•Thereisalackoftrustworthychannelsforcustomerstoacquireaccurateanddetailedinformationaboutinsurance.•Theperceivedvalueoflifeinsurancedeclineswalongperiodbuthavenotfiledclaimsonnon-savingsplans,orasinsurancecosts•Customersareimpatienttoreadthetermsandconditionsofinsurancecontracts.•Customershaveageneralconceptofthebroadcoverageofinsuranceproducts,buttheirknowledgeofthefunctionsandexclusionsofproductsislimited.Mortalityprotectiongapisestimatedbycalculatingthedifferencebetweenprotectionneedsandresourcesavailable.Protectionneedsconsistofcurrenthouseholddebtandfuturemedicalcost,educationcostandhouseholdexpenditure,whileresourcesavailablearecomposedoflifeinsurancecoverage,savingsandinvestments,andassetsrelatedtoretirementschemes.ForAXA4andhencedonotbudgetforit.Also,peoplewhoareemployedmayhaveafalsesenseofbenefitsoncetheyleaveemployment.Thesecommentspromptedustostudythefollowingquestions:ofinsuranceliteracyinasystematicliteracyamongHongKongpeo•Howdoesinsuranceliteracydifferbetweenpolicyholdersandnon-policcommonpatternsofliteracyamongnon-policyholders?•Towhatextentdocustomersunderstandthedesignandfunctionsofdifferentinsuranceproducts?AretheyabletochooseappropriateinsuranceproductsbasedontheirriskStudyingthequestionsabovecanhelpusidentifyliteracygapsandexplorepolicymeasurestonarrowthesegaps.Improvedliteracywillfacilitatethegeneralpublictoobtainappropriateandadequateprotection,whichmaximisesgapsthatcanshapepolicydevelopmentandpubliceducation,theInsuranceAuthority(“IA”)products,excludingcommerciallinestargetingcorporatepolicyholders.Ultimately,theIAaimedto(i)DevelopameasurementframeworktoevaluateinsuranceliteracyinHongKongandtrack(ii)Improvethepublic’sunderstandingoftheirriskprofilesandtheiroffunctions,designandfeaturesofinsuranceIAconductedtheILTSincollaborationwithPricewaterhouseCoopersLimited(“PwC”),whichproofanexternalconsultant.PwCaccSolutionsAssociatesLimited(“MSA”)wasengagedtoconductthesurveyfieldwork.5(iii)Enhanceconsumers’knowledgeabouttheirrightsanApartfromtheILTS,theIApreviouslylaunchedapubliceducationcampaignonlifetimtogiveacomprehensivepictureofthedifferentriskexposuresindividualsfaceduringtheirlifetime.Literacy”8alongwiththisreport,drawingoninsightsfromtheILTS.Therestofthisreportisstructuredasfollows:Section2providesaliteraturereview;Section3introducesthemethodologicalframeworkoftheILTS;Section4discussestheanalysisandimplicationsofthesurveyfi.hk/en/infocenter/files/Insurance_Literacy_Tracking_Survey_Thematic_Report_Eng.pdf6proposesadefinitionofinsuranceliteracyfortheoperationoftheILTS.Todevelopaframeworkwouldbetakenintoaccountwhendesigningthisframework,phenomenaprevalentintheHongKonginsurancesectorwereWithfinancialliteracygrowinginimportanceasawayforindividualstoimprovetheirfinancbeing9,governmentsaroundtheworldhavesteppedupeffortstounderstandlevelsoffinancialliteracy,whileexploringpolicymeasurestoenhanceitamongtheirpophavebeenundertakentomeasurelevelsoffinancialliteracybyadoptingdifferentdefinitions.Measurementsoffinancialliteracyvarysubstantiallyacrosssurveys,whilealackofcommondefinitionsposesachallengewhenmakinginternationalcomparNetworkonFinancialEducation(“OECD/INFE”)developedacommonquestionnairebasedonprevioussurveys(AtkinsonandMessy,2012).Thiscommonquestionnaireadoptedthefollowingdefinitionoffinancialliteracy:attitudeandbehaviournecessarytomakesoundfinancialdecisionsand,ultimately,achieveindividualfinancialwell-being.10Thisdefinitionhasbeenwidelyadopted,asreflectedbytheparticipationof26economies(includingcontrast,thereisalackofcommonlyacceptenotedthatoneofthelimitationsinconductingresearchoninsuranceliteracyistheabsenceofgenerallyacceptedcriteriatoidentifytheessentialelementsofinsurancethataliterateconsumershouldknow.AcademicshaveproposedtheirdefinitionsanddifferentfocusesonaspectsofFinancialwell-beingreferstoastatewheretheirfinancialfuture,andisabletomakechoicesthatallowenjoymentofliAccordingtotheOECD/INFE,afinanciallyliteratepersonshouldhavebasicknowledgeoftoapplynumeracyskillsinfinancialsituations.Attitudecanbeconsideredtobepreferencestowardsspendingandsaving.Behaviourreferstotheactionsaffectingfinancialwell-being,suchasfinancialplanningandchoos7AuthorAllodietal.DefinitionKnowledge,understanding,skillsandattitude:•Knowledge—understandandmakeuseofinsuranceproductsunderconsideration•Understanding—haveareasonableunderstandingoftheriskscoveredbytheinsurancepotomakesenseofinsuranceproductsinthe•Skillsandattitude—applyknowledgeandunderstandingwiththeperceivedrisksandforfulfillingone’sownneedsKnowledge,confidenceandcapabilityininsurancedecision•Knowledge—understandingofinsuranceprinciplesand•Confidence—anindicatorofthelikelihoodofapplyingknowledgeeffectively•Capability—theamountofrelevantandaccurateWeedigeandOuyangKnowledgeandskillsnecessarytomakesoundinsurance•Knowledge—understandingof(i)potentialriskexposure;(ii)riskmitigationstrategies;(iii)insuranceconcept,•Skills—theabilitytoconfidentlyapplyknowledge8Theexistingresearchfoundthat,apartfromknowledgeandskills,emotional,cognitiveandbehaviouralfactorsplayanimportantroleinshapingal.,2019).Awell-designedinsofknowledge,skills,attitudeandbehaviourneededtomakesoundinsurancedecisions(WeedigeInsuranceliteracyisacombinationofknowledgeandskills,attitudeandbehaviournecessarytomakesounddecisionsThisdefinitionislargelyinlinewiththeOECD/INFE’sbroaddefinitionoffinancialliterafollowingsubsections.“Knowledge”referstotheunderstandingofinsuranceprinciples,terminology,productfeatures,andrightsandresponsibilitiesofpolicyholders,while“skills”meantheabilitytoapplyknowledgein(i)Knowledgeofinsuranceprinciples,terminologyandproductfeaturesAnumbrellapolicymeansadditional9(ii)Understandingofpolicyholders’rightsandresponsibilitiesInsuranceisafinancialproductwithdifferentconditionsbywhichpolicyholdershavetofulfilloryrequirements(principleofutmostgoodfaith)suchasaccurateandtruthfuldisclosfrefusal.Atthesametime,policyholdersareentitledtoenjoyrightssuchasacooling-offperiod(duringwhichtheycancanceltheirpoliciesandobtainarefundofpremiums).Therefore,makinginformedinsurancedecisionsrequiresconsumerstounderstandtheirrightsandresponsibilities(iii)AwarenessofriskexposureandprotectionneedsLiterateconsumersshouldhavetheabilitytochooseinsurancepneedsbasedontheirperceivedriskexposure(Allodietal.,2020).Theyarealsomorelikelytofoundthatconsumersoftendonotknowwhattypeoflifeinsuranceproductsandhowmuchadjusttheirlevelsofprotecti2.1.2Attitude“Attitude”isaperson’sdegreeoffavorabilit2008).Attitudeinfluenceswillingness,whichinturnaffectsbehaviour.Apositiveattitudetowardsinsuranceleadstogreaterwillingnesstopayforit(RochaandBotelho,2018).Attitudetowardsinsurancedependsontrustininsuranceandtheperceivedvalueofinsurance(Tametal.,2021;obligations(Weedigeetal.,2019).Insurancecontractsapplythethatcontractingpartiesareobligedtodiscloseallmaterialinformation.Insurersandconsumerswouldnotenterintocontractswithouttrustineachother.ininsurancewasprevalentinAustraliaanditundermiinsurance.Also,alackofknowlotherinformationormediacontentthatreinforcestheirperceptions.Thisisconsumers’beliefabouttheextenttowhichtheywillbebetteroffbytakingoutpersonalpromotionofriskmanagementandefficientuseofanindividual’sresources.ThemoreperceivedDriveretal.(2018)foundthatthepublicinAustraliagenerallydidnotseethevalueofpersonalinsuranceandthereforedidincludedbeliefingovernmentsupport,abilityoffamilyandfriendstoassistandaperceivedquick(iii)Consumers’confidenceindecisionthatAmericanconsumersdidnotfeelconfidentinmakicoursearedeterminantsofconfidenceindecisionmaking(Tennyson,2011a).Moreover,choiceoverloadaffectsconfidenceininsurancedecisionmaking.AU.S.researchpaperfoundthatthecomplexityofhealthinsuranceoptionsreducedconfidenceamongtheelderlyintheirinsurancedecisionmaking.Theypreferreddelegatinginsurancedecisionstoothers,andtheywerelessconfidenceindecisionmakingmayleadtonegativeattitudestowardsinsuhis/herfinancialwell-being(AtkinsonandMessy,2012).Itcanbeclassifiedintopre-andpost-ComparisonofinsuranceTheOECDregardstheabilitytochooseappropriateproductsasoneoftheindicatorsoffinancialliteracy(Kempson,2009).AsurveyconductedinAustraliaalsoidentified“choosingfinancialproducts”asoneofthefivebehaviouralindicatorsofanpointfordeterminingwhetherconsumers’shoppingaroundbeforetakingoutinsuranceisimportantChannelsofinformationinformationsources,suchasprofessionaladvice.Forexample,asurveyinAustraliafoundthatconsumerswhohadreceivedfinancialadviceonlifeinsurancedemonstratedahigherlevelofinsuranceliteracy,astpolicies(CoreData,2014).Conversely,anothersurveyintheU.S.foundthatrespondentswhopreferredinformalinformationsources,suchasfamilyorfriends,scoredsignificantlylowerinanProcrastinationisahurdletopurchasinginsurance.Thisstemsfromthepurchasingprocessnotbeingfullyunderstoodbyconsumers,theinvolvementofdifficulttasksandtheneedforsubstantialresultinginpostponementLengthyandcomplicatedunderwritingprocessThisisoneofthebiastostickwiththeirpresentchoiceforfearofpotentiallossesiftheyswitchofshoppingaround.Renincentivetoshoparoundforthebestdealwhentheyareaffectedbystatusquobias.Fulfillingpolicyholder’sresponsibilitiesAsurveyinEuropefoundthatconsumerswerenotgoodatidentifyingtheirpost-saleresponsibilitiesnotawarethattheyneedtoinformtheirinsurersimmediatelyiftheyrentouttheirpropertiesoriftheproperty’sstructureisaltered.Policyholdersoftenonlyfindoutabouttheirobligationswhentheyfilehandling.filingclaimsforfearofbeingpenalisedbyinsurersinmayalsogivetheincidentalowerpriorityiftheydonotconsiderittobesignificant.However,differentjurisdictions(AtkinsonandMessy,2012).Thequestionnaireincludescorequestionsonfinancialliteracyandotherquestionsage,gender,educationlevel,workstatusand•Knowledge—Thescoreiscomputedasthenumberofcorrectresponsesto7knowledgequestions12,rangingfrom0to7.•Attitude—A5-pointscaleisappliedtoattitudequestions,with1pointrepresentingcompleteagreementand5pointscompletedisagreement.Thescoreiscomputedasthesumofthe•Behaviour—ThescoreiscomputedastheThefinancialliteracyscoreisobtainedbysummingthescoresfoItrangesfrom1to21,withaweightingratioofknowledge,attitudeandbehaviourof7:5:9.Thecoquestionsandthecorrespondingscoringcriterioncanbefoutothepilotstudybetween2010and201Thequestionnairecanbeusedinfacanbeapplied.Thequestionondivision:“Imaginethatfivebrothersareghowmuchdoeseachoneget?”hasnotbeenconsideredrelativelyeasyandisnotagoodindicatoroffinancInquotasampling,apopulationissegmentedintosub-groupsbasedonfofsampleunitsisselectedforeachsubTheFinancialPlanningAssociationofAustralia(“FPA”)andZurichFinancialServices(“Zurich”)permanentdisability(“TPD”)andincomeprotection,coverageoflifeinsuranceandwaitingperiods),insuranceliteracyscore.Thetotalscoreiscalculatedbyassigningscorestoknowledgeandruns1to10,where7-10meansexcellentliteracy,5-6fairand1-4poor.Examplesof•Doyouknowtheapproximatevaluethatyouareinsuredforthroughyourlife/TPD/incomeprotectioncover?•Howconfidentareyouthatyouknowthemonthlypremium/costofyourlife/TPD/incomeprotectioncover?•Whatisyourunderstandingofthetaxdeductibilityoftermlifeinsurance?(amultiple-choicequestion;respondentsaregiven•Whichofthefollowingdoyoubelieveisaneffectivesubstitutefortermlife,TPDorincomeprotectioninsurance?(amultiple-choicequestion;optionsincludeprivatehealthinsurance,personalsavingsandu10-questionquestionnairesoninsuranceknowledge,includinginsuranceprinciples,tproductfeatures.Onepointisallocatedforeachcorrect•Whattypeoffinancialcoveragedoesshort-termdisabilityinsuranceprovide?publiceducationinthefuture.Assuch,thefollowingtopicsdeservefurtherattentionanddiscussion.insuranceagentshandlepremiumswhichclientspaytotheminorderforagentstopassthetoconfusionanduncertaintywhenpolicyholderscontactinsurersaComplaintsBureau,2021).ThissuggeststhatthereisconsiderableroomforimprovinginsuranceknowledgeamongthegeneralpublicinHongKong,inadditiontocomprehendinginsuranceprinciples,productdesignandfeatures.SomeinsurersinHongKongofferpromotions,includingcompfoundthatpromotionssuchasretailvouchersandcashbacksprovidedbyinsurersunderminedfirst,duetothepre-existingrelationshipoftrustwiththesepotentialconsumers.Inthissituation,thepurchasedecisionmaybemadebasedonasenseoffamilyobligationratherthanmeetingprotectionneeds.Furthermore,potentialconsumersmaynotpaycarefulattentiontotermsandconditions(“T&Cs”)ofpolicies,andtheymaynotseekprofessionaladvice(InsuranceAuthority,components,suchaswholelifeinsuranceandendowment,appeartobemorepopulartinsurance—apureprotection-typedproduct.ItisthusworthexploringtheperceivedvalueoflifeAtthepointofsaleofaparticipatinglifepolicy,potentialpolicyholdersareprovidedwithsomeinformationaboutprojectedbenefitsinthedocumentnamed“benefitillustrations”.UnderstandingthecontentsofbenefitillustrationsdefinitelyhelpspolicyhSomeissuesrelatedtopropertyandcasualtyinsurancehavebeenidentified.InhomeandfiretakingupcomprehensivecoveragemayimplythatlocaldriverstakeoutmotorinsurancepurelybasedonlegalrequirementandarelessconcernedabouttheneedtoprotectagainstdamagetoThissectionintroducesthemethodologicalframeworkdevelopedfortheILTS.TheframeworkThequestionnaireisdividedintothreeparts,including(i)backgroundquestions;(ii)scoringquestions;and(iii)non-scorimadeupofaround10backgroundquestions,23scoringquestionsand17to37non-scoringBackgroundquestionsBackgroundquestionscoverbasicdemographicinformationsuchasage,gender,employment,incomeandeducationlevels.ThesequestScoringquestionsdimensionsofinsuranceliteracy,namelyknowledgeandskills(“K”),attitude(“A”)andbehaviour(“B”).Thescopeofscoringquestionsisbasedonthethemesundereachdimensionofinsurancebasedonthreecriteriatwoquestionsarebasedonoverlappingpropositions,themoregeneralonewouldbechosenforscoring.Forexample,respondentswerescoredbasedontheirlevelofagreementwiththepropositionthat“Insuranceisanimportantserviceforeveryone”,insteadof“AtdifferentstagesofTherefore,weneeddifferenttypesofinsurancetorespond”.Andlastly(iii)relevanceandcommonality—thismeansthatthetestednotion,conceptorterminologyshouldbeaswidelyapplicabletorespondentsaspossible.Forexample,respondentsweretestedonthedefinitionsof“premium”and“deductible”insteadof“coinsurance”,astheformertermsaremorecommon.Non-scoringquestionsSurveyquestionsareadaptedtothecharacteristicsoftheHongKonginsurancemarket.Forinsurance.Product-basedquestionsareassignedtorespondentsaccordingtotheirinsuranceportfolio,soastoexaminetheirliteracyintermsofindividualproducts.Product-basedquestionscoverawiderangeofinsurancepolicies,suchaslife,medical,criticalillness,personalaccident,travel,home,fire,motorandpetinsurance,aswellasannuity.14Inordertogatherinsightsforapubliceducationcampaignonlifetimeriskprofiling,someofthequestionsincludedinthequestionnairelookatinsurAccident,tTheOECD’sscoringmechanismformeasuringfinancialliteracyhasinformedthescoringmethodologyusedfortheILTS.Therespondents’scoresindicatetheirperformancein23scoringNon-policyholders’experienceofinsuranceisobviouslydifferentfromthatofpolicyholders.Forinstance,non-policyholdershavenoexperienceofreviewingandrenewinginsurancepolicies.Tonon-policyholdersorpolicyholders(nphorph)fordataanalysis.Evenwithingroup,somequestionsmayfurtherdrilldowntohelpdifferentiatevariouspolicyholders’behaviour.Forexample,thesurveyinvestirespondenti,andNisthetotalnumberofrespondents.scoreofAforallrespondents,whichisnormalisedto100%,isobtainedbyusingthefollowingequation:respondenti,andNisthetotalnumberofrespondents.RespondentsneedtoanswerdifferentsetsofquestionsforB,dependingonwhethertheyholdaequationbelow:ofBfornph,ngiphandgiphrespondentirespectively.Nisthetotalnumberofrespondents,isasumofthenumbersofAfterobtainingtheinsuranceliteracyscoresfornphandphrespondents,thetotalscoreforallwhereS%denotesthetoandphrespondents.AsrespondentshavedifferentsetsofscoringquestionsdependingonwhethertheyholdapotheweightingsofK,AandBvaryfordifferentgroupsofrespondents.Theforgiphrespondentsis7:6:8,whichisveryslightlyfromtheOECD’sscoringmechanism.But,asnon-policyholdersandpolicyholdershavedifferentinsurance-relatedbehaviour,theseweightingsreflectthevaryingimportanceofbehaviourfbothnon-policyholdersandpolicyholdersinHongKong.Scoresabove70%represent‘highlyliterate’,between50%and70%‘moderatelyliterate’,Thesurveywasconductetoproviderealtimeexplanationandclarificationtorespondents.ToensurethesurveywasToensurethedatacollectedtrulyreflectedthecharacteristicsofthepopulation,quotasamplingwasperformedagainstfivecriteria,mainlywithreferencetothelateststatisticsofpopulationdistributionpublishedbyHongKong’sCensusandStatisticsDepartment.Thefivecriteriawere(i)ageanddemographicprofileofthesampleisshowninARespondentsowningpersonalinsurancepolicieswereinvitedtoanswerproduHavingconsideredtherealityofthemultipleinsur