“We are building a community space.”

Bowtie Insurance, Hong Kong’s first virtual insurer, decided that they must have some physical interaction with their customers and opened Bow Coffee for them to walk in, order a latte and decide the life or health insurance policy that works best for them!

We caught up with Gabriel Kung, Chief Commercial Officer at Bowtie Life Insurance Company, to learn more about this unique initiative.

What are the key trends that impacted the Insurance space in 2023?

The biggest trend is Digitalization. Everyone is talking about digitalization because people are searching, comparing, and considering buying Insurance online. Post-Covid we are looking at a customer-led digital insurance journey and insurers are switching to or at least looking at alternatives. In fact, recent research by Insurance Authorities found that ~ 70% of the respondents in Hong Kong rely on informal sources such as friends and family to make their insurance decisions.

How have Insurance agencies in Hong Kong adapted to rapid digitalization?

Hong Kong is the most developed financial market in the world. Insurance penetration is super high, people are paying a lot for insurance.

However, pre-Covid, the insurance market was driven by the face-to-face selling model. And the downside of that model is the human agency or brokerage channel sold high investment value products bundled as a Life Policy. In other words, that’s not insurance, it’s a saving product. The whole process is going online now. People are demanding more transparent and simple insurance products, which has given rise to something that we call Pure Protection Insurance in Hong Kong.

It’s the era of the consumer’s purchasing power. They are forcing the industry to launch simpler and more affordable insurance. This is what Bowtie loves to see because our vision is to make insurance good again. The Pure Protection Insurance trend is changing the Hong Kong insurance market from a high commission-driven one to something that’s more customer-led.

Can you give examples of how Product Innovation has helped solve customer pain points?

Good question. Let me use a reference from the travel industry. So, before the launch of OTA (Online Travel Agency), there were very few budget airlines in the market. People relied on human or physical travel agencies with very high overheads to buy their travel products. Of course, these agencies preferred selling products that were expensive – a lot of complex structures bundled into a product. But with the introduction of OTA, more transparent and affordable options were available for customers leading to the growth of the budget airlines industry.

Similar innovation is happening in Insurance too. The introduction of VHS (Voluntary Health Insurance) schemes in Hong Kong has helped people get medical insurance that is super affordable. It’s about personalizing products to reach out to more customers at scale and deliver value to them.

What are your learnings? Any surprises or interesting stories that you would like to share with our readers?

We call ourselves disruptors. Actually, being disruptors, there were lots of surprises throughout our journey!

Before we launched the Bow Coffee concept, we thought that the younger generation would be the early adapters. In reality, our biggest supporters turned out to be financial experts and Insurance agents – not necessarily the youngest, but people who knew their product the best.

We then realized by making Insurance simple, we were being endorsed and supported by financial institutions that disliked complex products. We’re not creating insurance for a niche audience, instead we speak to the mainstream, mass market – we tell them to let’s go back to the basic form of insurance.

What does the future look like for Bow Coffee?

We are building a community space – a space for us to meet our customers and supporters. How often do you see Insurance companies speaking to their customers? Our Happy Hour events helped us connect with our customers. We got useful and candid feedback. The possibilities are immense. We invite the CEOs, Operations, Product, and Marketing teams to speak to customers. And this, we find insightful.