The emerging Asian middle class shows clear signs of optimism despite economic headwinds. Health, well-being, and financial wealth are the most important priorities in this consumer segment, according to the findings of a consumer survey released by Peak Reinsurance Company (Peak Re), a Hong Kong-based global reinsurer.
With growing economic prosperity, these customers will require more risk mitigation and protection solutions, creating significant opportunities for the re/insurance sector, says the survey report that was released last week on the occasion of Peak Re's upcoming 10th anniversary. In collaboration with Intuit Research, Peak Re commissioned a regional survey in the second quarter of 2022 to identify the unique characteristics of the emerging Asian middle class. Understanding the behaviour and preferences of the emerging Asian middle class is critical to successfully tapping into this important insurance market segment. These consumers need more insurance coverage as they begin to accumulate wealth and make plans for their retirement and their children's education.
Mr. Franz Josef Hahn, CEO of Peak Re, said, "Emerging Asia's share of world GDP has increased significantly from 5% in 1990 to an estimated 26% in 2022, according to the IMF. Despite cyclical economic challenges, emerging Asia is expected to remain the fastest-growing region in the world over the next decade.
"With higher income levels and the rise of the middle class, there are significant opportunities for insurers and reinsurers to offer risk mitigation and protection solutions."
Optimism over financial well-being and social mobility
According to the survey, the emerging Asian middle class is clearly more optimistic about its financial well-being, social mobility and the success of its children, compared to its counterparts in mature Asia.
Emerging Asia’s middle class is also more health-conscious and inclined to take health-promoting measures, whilst being aware of the heavy financial burden of medical expenses.
In terms of personal finances, the survey shows middle-class people in emerging Asia are also more confident about their financial literacy and more disciplined about spending and saving. This optimism is reflected in the fact that more of them have ambitions to become entrepreneurs or expect employers to improve work-life balance.
Seven emerging Asian markets are included in this survey, namely Malaysia, Indonesia, Thailand, Vietnam, Philippines, China and India. Three mature Asian markets are also included for comparative purposes: South Korea, Hong Kong and Japan.