Singapore’s Life Insurance Market Faces Challenges Amid Rising Costs, Yet Opportunities Persist

Singapore’s life insurance market is navigating a complex landscape as rising inflation and cost-of-living pressures, reported by 90% of Singaporeans per the Sun Life Asia Financial Resilience Index 2025, have led to a 19% drop in life insurance uptake and an 18% decline in investment-linked products (ILPs) year-on-year.

Despite these challenges, the market, valued at USD 72.15 billion in 2025, is projected to grow at a 9.95% CAGR to reach USD 115.93 billion by 2030, driven by an aging population, increasing health awareness, and digital innovation.

This report examines Singapore’s life insurance market, focusing on individual and family income dynamics, product features, and population trends, with comparisons to Hong Kong, Japan, and mainland China, highlighting opportunities and challenges in the region’s evolving insurance landscape.

Singapore’s Life Insurance Market

Singapore Life Insurance Market Overview

Market Size and Growth

The Singapore life and non-life insurance market is valued at USD 72.15 billion in 2025, with life insurance comprising a significant portion, driven by USD 1.14 billion in weighted new business premiums in Q1 2025, a 10.9% increase year-on-year. The market is expected to grow at a 9.95% CAGR through 2030, propelled by demographic shifts, digitalization, and rising consumer purchasing power.

However, inflation (3.1% headline forecast for 2025) and a 0–2% GDP growth outlook have strained household budgets, with 42% of Singaporeans struggling to cover monthly expenses, leading to a focus on short-term financial needs over long-term planning. Only 8% plan more than 10 years ahead, dropping to 5% for high-income earners, per the Sun Life survey.

Population and Income Dynamics

Singapore’s population of 5.92 million (2024) is aging rapidly, with 20% expected to be aged 65 or older by 2030. Median household income is approximately SGD 121,188 (USD 90,000) annually, but 90% of households report inflation impacts, with high-income earners (top 20%) equally affected (89%). This has led to a 57% lack of financial plans beyond 12 months, prioritizing immediate expenses over insurance. The high-net-worth individual (HNWI) segment, with 5,300 ultra-HNWIs (net worth >USD 30 million), drives demand for premium products like ILPs and whole life insurance.

Key Product Features

• Whole Life Insurance: Dominates with a 44% share of gross written premiums (GWP) in 2024, offering lifelong coverage and savings components. Single-premium policies are popular among HNWIs for wealth preservation.

• Endowment Insurance: Accounts for 32.8% of GWP, growing at a 3.7% CAGR, appealing to those seeking wealth accumulation and guaranteed returns.

• Personal Accident and Health (PA&H): Represents 14.2% of GWP, with a 6.6% CAGR, driven by rising medical costs (12% annual increase) and demand for critical illness coverage.

• Investment-Linked Products (ILPs): Combine protection with market-linked returns, but saw an 18% uptake decline due to economic uncertainty.

Distribution Channels

• Financial Advisers (FAs): Secured SGD 14.6 billion in sum assured in Q1 2025 (43.3%), leveraging personalized advice.

• Tied Agents: Contributed SGD 10.9 billion (32.4%), focusing on traditional sales.

• Digital Platforms: Growing rapidly, with 70% of insurers using mobile-first solutions, enhancing accessibility for younger demographics like Gen Z.

Comparative Analysis Across APAC Markets

The life insurance markets in Singapore, Hong Kong, Japan, and mainland China reflect diverse economic, demographic, and regulatory landscapes. Below is a detailed comparison of market size, product preferences, and key drivers, using 2024–2025 data.

Metric	Singapore	Hong Kong	Japan	Mainland China
Market Size (2024, USD B)	64.97	76.15	300 (est.)	450 (est.)
CAGR (2025–2030)	9.95%	5.7%	2.3%	6.7%
Population (2024, M)	5.92	7.5	125.1	1,425
Median Household Income (USD)	90,000	53,000	40,000	12,000
Insurance Penetration (% GDP)	6.5%	20.1%	8.7%	3.2%
Top Products	Whole Life (44%), Endowment (32.8%), PA&H (14.2%)	Life (78%), Medical (76%), Savings (60%)	Annuities, Whole Life, Medical	Whole Life, Medical, Parametric
Key Features	Single-premium, wellness-focused (AIA Vitality)	Direct billing, legacy-focused (AIA Global Power)	Longevity-focused, multi-pay CI	High-end medical, wealth transfer
Key Drivers	Aging population (20% >65 by 2030), digitalization	GBA integration, HNWI demand (1,116 UHNWIs)	Aging population (30% >65), low rates	Regulatory mandates, service sector ($2.1T)
Challenges	Inflation (90% impact), low long-term planning (8%)	High premiums, healthcare costs (18% rise)	Negative spread, market saturation	Mis-selling, regulatory complexity

Notes:

• Market Size: Singapore from Mordor Intelligence (2024: USD 64.97B); Hong Kong from Insurance Authority (2024: HKD 637.8B, USD 76.15B); Japan and China estimated from Swiss Re and industry data.

• CAGR: Singapore from Mordor Intelligence (9.95%); Hong Kong from Zhu’s forecast (5.7%); Japan from Swiss Re (2.3%); China from GlobalData (6.7%).

• Population: Singapore (5.92M), Hong Kong (7.5M), Japan (125.1M), China (1,425M) from World Bank and local statistics.

• Income: Singapore (SGD 121,188), Hong Kong (HKD 416,000), Japan (JPY 5.5M), China (CNY 85,000) from national statistics.

• Penetration: Singapore (6.5%), Hong Kong (20.1%), Japan (8.7%), China (3.2%) from Swiss Re and Bain & Company.

• Products/Features: Derived from Manulife-Forbes, GlobalData, and company reports.

Analysis of Regional Differences

1. Singapore:

   • Market Dynamics: The USD 64.97 billion market is driven by an aging population (20% over 65 by 2030) and digital platforms (70% insurer adoption). However, 90% of Singaporeans report inflation impacts, with only 8% planning beyond 10 years, leading to a 19% drop in life insurance uptake.

   • Product Preferences: Whole life (44%) and endowment (32.8%) dominate, with PA&H (14.2%) growing fastest due to 12% medical cost inflation. ILPs face an 18% decline amid economic uncertainty.

   • Reasons: High income (USD 90,000) supports demand for single-premium products among HNWIs, but inflation shifts focus to immediate needs. Wellness-focused products like AIA Vitality appeal to health-conscious consumers.

2. Hong Kong:

   • Market Dynamics: The USD 76.15 billion market, with a 5.7% CAGR, benefits from GBA integration and 1,116 UHNWIs. A 2.1% premium increase in 2023 was driven by mainland Chinese visitors (30% of new business). 47% of HNWIs lack confidence in long-term health planning.

   • Product Preferences: Life (78%), medical (76%), and savings (60%) products, like AIA’s Global Power Multi-Currency Plan, focus on legacy and direct billing.

   • Reasons: Hong Kong’s financial hub status and 20.1% insurance penetration drive demand, but 18% healthcare cost rises and HKRBC compliance costs challenge affordability.

3. Japan:

   • Market Dynamics: The USD 300 billion market, with a 2.3% CAGR, is mature but faces a negative spread challenge due to low interest rates. 30% of the population is over 65, driving demand for annuities and critical illness (CI) products.

   • Product Preferences: Annuities and multi-pay CI products dominate, with over 30 new CI products launched in 2023–2024, covering 100+ conditions.

   • Reasons: Longevity and high litigation costs (USD 50,000–100,000 per case) fuel demand, but market saturation and regulatory complexity limit growth.

4. Mainland China:

   • Market Dynamics: The USD 450 billion market, with a 6.7% CAGR, is driven by a $2.1 trillion service sector and NFRA mandates. 76% of HNWIs own medical insurance, but mis-selling led to a 7.5% policy cancellation rate in 2023.

   • Product Preferences: Whole life and medical products, like Ping An’s health plans, focus on high-end protection. Parametric insurance for critical illnesses is emerging.

   • Reasons: Low penetration (3.2%) offers growth potential, but regulatory complexity and claim delays hinder progress.

Outlook and Implications

Singapore’s life insurance market, despite a 19% uptake decline due to inflation, is poised for recovery with a 9.95% CAGR through 2030, driven by an aging population and digital innovation.

Hong Kong’s high penetration and HNWI focus contrast with Japan’s mature, longevity-driven market and China’s vast but underdeveloped potential. Insurers are responding with AI-driven underwriting and health-focused products, but challenges like high premiums, regulatory costs, and short-term planning (only 8% in Singapore plan beyond 10 years) persist. As APAC’s insurance market grows, tailored solutions for HNWIs and families will be critical to closing protection gaps.

Consult Everbright Actuarial Consulting for Expert Guidance

To navigate the evolving life insurance markets in Singapore, Hong Kong, Japan, or mainland China, contact Everbright Actuarial Consulting at info@ebactuary.com . Our team offers tailored risk assessments, product evaluations, and strategic insights to align with your financial and health goals. Reach out for consultations or educational resources to secure your future.