Small but mighty.
When it comes to Macau, China, a special administrative region of the People’s Republic, those three words couldn’t be more fitting. After all, the city of about 683,000 people only severed ties with Portugal, which colonized it in the 16th century, in 1999. But in the subsequent years, Macau, an 11-square-mile region on the southeastern edge of China, has made a big splash.
“Macau is one of the cities with the highest GDP in the world, which is why Macau’s economy is diversified,” said Stanley Ho Man Chio, a seven-year MDRT member. “There is a great demand for financial services and the insurance industry.”
Macau’s biggest claim to fame is its gaming industry. It is often called “the gambling capital of the world” because of its casinos, which generated about $37 billion in gross gaming revenue (GGR) in 2019, according to Gaming Inspection and Coordination Bureau data. Tourism, which Ho Man Chio calls “well-developed,” is the city’s main industry, with about two-thirds of the city’s visitors coming from mainland China to frequent the casino scene.
Due to COVID-19, much of that cross-border activity was halted in 2020, leading to significant losses in gaming revenue. The Macau government expects the casino industry to generate $16.25 billion in GGR this year.
But while the casinos may have taken a hit thanks to the pandemic, Ho Man Chio says the city at large handled the challenges of COVID-19 relatively well. (Good news, since Macau is the most densely populated region on earth.)
“Macau’s measures to deal with the pandemic were very rapid, and it did not spread in the urban area,” he said. “Fortunately, it did not have a big impact on our daily work.”
However, the pandemic did result in an unexpected milestone in Ho Man Chio’s 13-year career: his first critical illness claim.
“Many people’s income has declined due to the pandemic,” he said. “The disease comes at unexpected times, so our responsibility is very important.”
Ho Man Chio takes great pride in providing this type of consistent, reliable service to his clients.
“Establishing a good client experience is very important,” he said. “I professionally analyze clients’ financial needs, provide client-first opinions and review with them regularly. I am like a family finance doctor, clearly understanding the insurance and financial needs of different clients. I must understand the income status of the couple, the educational needs of the children, and the age and retirement status of their parents. This allows me to design tailor-made solutions for my clients.”
He predicts one of the biggest threats to the profession in Macau to be the same as in any other country of the world: artificial intelligence. But he isn’t content to yield control of the financial services profession to AI just yet.
“I think that in the next few years, artificial intelligence will replace some of our work,” he said. “Therefore, our role needs to be multi-specialized. In addition to comprehensive financial services and insurance advice, we also need to have knowledge of taxation, law and inheritance to keep our competitiveness.”
The insurance industry in Macau is overseen by the Monetary Authority of Macao. As of December 2019, 25 insurance companies operated in the city, made up of 12 life and 13 non-life companies. Ho Man Chio said the demand for investment-linked life insurance is increasing, so advisors will need to educate themselves about these products to “keep pace with the market.”
Another recent change came about in January 2018, when the government approved and implemented the non-mandatory central provident fund system, designed to complement the existing social security system and provide for residents in their old age. Residents can withdraw funds once they reach the age of 65, although extenuating circumstances may allow for earlier withdrawal. About 13% of the city’s population is older than 65, and life expectancy in Macau is approximately 85.
As for Ho Man Chio, he will continue to focus on his clients, regardless of their age, and not gamble, even metaphorically speaking, with their hard-earned money.
“This is a professional, but also human, industry,” he said. “We must patiently listen to the needs of our customers, and design the most suitable solutions for them. We must give priority to the needs of our customers, not our own interests.”
More about Macau and MDRT
- In 2020, MDRT had 736 members from Macau, 192 of them first-time members.
- 68% of the members are female and 32% are male.
- In 2009, MDRT had just 58 members from Macau, representing an 80% increase over 11 years. In 1999, the year it was established as a special administrative region, there were only six members.
- The average age of MDRT members from Macau is 38.9.