| Wealth management focuses on high net worth individuals and insurance |
| data:2024-04-13 10:22:52 | viewed： |
As the world's second-largest wealth management market, China's ultra-high net worth family customer base is growing rapidly, and demand is becoming increasingly diverse, which is also driving the family office industry to usher in a window of takeoff. The 2022 Yicai Hurun Wealth Report shows that in the next 10 years, China will pass on 19 trillion yuan of wealth to the next generation, 51 trillion yuan of wealth to the next 20 years, and nearly 100 trillion yuan of wealth to the next 30 years. This series of numbers has brought infinite imagination space to the family office. A reporter from China Business Daily noticed that more and more insurance companies and practitioners have chosen the "family office" wealth management form as a way to serve high net worth individuals. Recently, the reporter learned from Dajia Life Insurance Co., Ltd. (hereinafter referred to as "Dajia Life") that Dajia Life has established a new family office incubation center. It plans to incubate a group of high-quality, customer-centric family office partners in 2 to 3 years, gradually laying out in first tier cities such as Beijing, Shanghai, Guangzhou, and Shenzhen. Within 3 to 5 years, it will incubate 100 diversified Chinese style family offices. Prior to this, institutions such as CITIC Prudential Life Insurance Co., Ltd. (hereinafter referred to as "CITIC Prudential Life"), Zhonghong Life Insurance Co., Ltd. (hereinafter referred to as "Zhonghong Life"), and Taiping Life Insurance Co., Ltd. have launched family offices to provide users with wealth management, family trust, legal and tax consulting, education planning and other services. In addition, insurance intermediaries are also laying out family offices in 2023, such as the launch of the high-end business brand "Pan China Family Office" by Pan China Insurance Sales and Service Group. At the same time, based in the Guangdong Hong Kong Macao Greater Bay Area, Pan China Guangdong Company also launched the "Pan China (Bay Area) Family Office". This makes people wonder, what is the confidence of insurance companies to rush forward? Basic formation of "1+N" mode Public information shows that the demands of ultra-high net worth clients for family offices are mainly divided into two categories, the first being asset management. For example, comprehensive management of asset situation, including asset project ownership confirmation, risk identification, investment, and post investment management. The second is family affairs management. For example, family member health management, education planning, insurance planning, and the need to complete family affairs such as second-generation succession. At the same time, the transformation of the management concept of insurance companies, as well as the improvement of service awareness, competition awareness, efficiency awareness, and development awareness, further promote the layout of insurance companies in the family office field. According to interviews with reporters, there are three common types of asset inheritance financial instruments in the family office market. The first type is large insurance policies, including annuity insurance and lifelong life insurance, the second type is insurance trust composed of insurance and trust, and the third type is family trust. Among these tools, insurance products are popular among high net worth individuals due to their easy to explain structural logic and clear calculation of returns. According to incomplete statistics by reporters, more than ten life insurance companies in the industry have successively established family offices, such as the four major Taikang family offices launched by Taikang Insurance Group: "Tianxingjian - Family Wealth Creation, Landform Kun - Family Wealth Preservation, Long Life - Family Wealth Transmission, and Harmony Zhiyuan - Excellent Life", the "Kangda" family office established by CITIC Prudential Life, the "Hongyun Shijia" family office of Zhonghong Life, and the "Chuanshi" family office of AIA Life Insurance Co., Ltd. The head of the product department of a joint venture life insurance company in Beijing told reporters that the clear purpose of setting up an insurance family office is to provide comprehensive solutions for ultra-high net worth customers, which can earn both premiums and reputation; Build a high net worth customer service platform for high-quality talents in the team, and deeply bind with high production capacity and high-quality marketing talents. According to the Insights Report on Chinese Insurance Family Offices (2022) released by the Home Office Standards Research Institute (hereinafter referred to as the "Report"), there are currently two major groups in insurance family offices: one is embedded family offices in insurance companies, and the other is family offices created by senior insurance agents. There are two branches in the embedded family office of an insurance company, one is the insurance company type family office, and the other is the insurance intermediary type family office. For these two types, the insurance company type family office benefits from the scale of its own platform, and there will be a standardized model when providing family office services. The service core is still centered around the products of the insurance company, and the provision of non insurance projects mainly plays a role in maintaining the stock of high net worth customers and increasing stickiness. For insurance intermediary platforms, they mainly provide services, which have greater freedom. When providing services to high net worth customers, they can consider their personalized needs more and provide targeted services. The above report shows that. According to the reporter's understanding, in terms of model, the family office platform of insurance companies has specifically set up a "1+N" model, which means that one high net worth customer is connected to one consulting consultant or insurance agent, and external professional organization teams are provided in areas such as insurance trust services, legal consultation, tax planning, high-end medical care, and high-end art investment. This means that the wealth management needs of high net worth individuals are quickly and efficiently "transmitted" to external professional organization teams through insurance agents or consultants for execution. Deng Hanzhu, General Manager of the Family Office Incubation Center of Dajia Life Insurance (hereinafter referred to as "Dajia Life Incubation Center"), introduced that the center has initially established six service systems: "inheritance services, legal and tax services, charity services, value-added services, overseas services, and investment services", which can meet the needs of customers in four aspects: "personal investment and life, family wealth and inheritance, enterprise operation and development, social public welfare and charity". "To build a family office service platform, insurance companies need to collaborate with law firms, heir cultivation, accounting firms, tax consulting and other institutions. On the one hand, they need to solve the tax collection legal confusion of high net worth individuals in terms of asset risk isolation and inheritance in real estate, art, corporate equity, and other areas. On the other hand, they also need to help the descendants of high net worth individuals establish the concept of inheriting family businesses and become good successors to family businesses. These tasks are very complex and require continuous accumulation of service experience in practical operations," said the head of the product department of the aforementioned insurance company. Urgent need to establish unique competitiveness However, industry insiders say that insurance companies entering family offices face considerable competitive pressure. Ms. Liu, a senior practitioner in the insurance family office, told reporters that the family office cannot be just a marketing slogan. "I personally believe that when an insurance company operates as a family office, it needs to change its stance and not solely focus on selling insurance products. Professional advice is crucial for customers, as blindly pushing their own products to them will make it difficult for them to turn things around once they lose trust. At the same time, the external service team of the family office cannot be seen as a key link in selling a specific insurance product. Therefore, insurance practitioners need to provide services to customers from the customer's perspective through asset allocation consulting, and drive customers to pay through professional and rational analysis." Ms. Liu said. The above report also shows that for insurance agents, they need to break away from the original service scope and expand their service scope, truly providing customers with professional full life cycle services. In this process, the insurer should transition from the seller's role to the buyer's role. In the past, insurers provided products, and for agents on different platforms, the ultimate value they provided to customers was in insurance products; However, in the entire family office service system, agents are mostly in the position of intermediaries. In addition to their own products, agents need to collaborate more with external institutions to provide services to high net worth customers. In addition to mindset shift, another important factor is how to build the unique competitiveness of insurance companies in their family offices. Public information shows that currently, insurance companies, whether building service teams internally or outsourcing services, have high resource and integration capabilities, as well as professional personnel allocation. By building "architecture consulting teams+asset management capabilities," they aim to achieve one-stop customized services. However, according to family office employees, many third-party family offices and insurance company family offices have similar business layouts in service content, and their resource allocation is industry-leading, with their respective business quality basically maintained at the same level. In addition, third-party family offices also have a special competitive advantage, which is the ability to contact overseas family trust service providers and customize a wider range of family wealth inheritance plans based on the actual domestic and foreign assets of high net worth individuals. However, the vast majority of domestic insurance companies have not yet entered this business. Building a family office platform can help high net worth individuals recognize who they are and attract them to seek advice. However, how to gain the trust of these high net worth individuals and accept home services from insurance companies requires answering questions such as' why you were chosen 'and' what are your unique advantages. 'These all require careful consideration and clear planning by insurance companies. Winning temporary applause is only temporary and depends on long-term service performance. |
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