Author
Bowtie Team
Updated on
2025-07-10
Disclaimer: This article is translated with the assistance of AI.
In Hong Kong, insurance agents often get a bad rap for overcharging clients. Join Bowtie as we sit down with Chi Wai, a 14-year veteran agent, to uncover two real-life scam stories and get insider tips on protecting yourself from being ripped off.
Case 1: Young Director Hits TOT with One Policy
Back in 2008, a young director was the talk of the town. Not even 30, he was already leading a team of over a hundred. What stuck with Chi Wai the most was how this guy hit ‘TOT (Top of the Table)’ status with just one policy, raking in nearly HK$3 million in commissions and bonuses.
This policy was an Asset Accumulator (AA) investment plan. Chi Wai reckons it had a long contribution period, like 30 years, with first-year premiums possibly exceeding HK$5 million and total premiums reaching HK$150 million or more. Back then, AA was the company’s hottest product, making up 60-70% of new business. Even though investment policies were all the rage in 2007-2008, hitting TOT with a single policy was still incredibly rare.
Here’s the twist: the deal eventually fell apart. Turns out, the client only intended to invest HK$10-20 million but was misled into signing this exorbitant long-term plan. The agent exploited the client’s trust and lack of knowledge, getting them to commit to a policy way beyond their means. As for the director, he was likely suspended for a year, but later reinstated with his title and perks, continuing to manage a large team.
Case 2: A Client Loaded with Investment Policies
In 2009, my director asked me to take over a client (Ms. A) from a colleague because she kept complaining about him. When I reviewed her case and all her policies, I was floored. Between 2006 and 2008, she had bought 4 or 5 investment policies, all long-term plans of 20-30 years (with first-year commission rates as high as 39-54%). Combined, her monthly contributions were HK$30,000-40,000.
By the time Ms. A met with me in 2009, she was in distress, desperate to complain about my colleague for pushing her into such massive plans. Sadly, there was little I could do except try to calm her down. In the end, Ms. A had to terminate all her plans early, losing hundreds of thousands of dollars. Meanwhile, my colleague pocketed around HK$150,000-200,000 in commissions—nearly half the MDRT (Million Dollar Round Table) benchmark.
Should You Be Wary of Savings Insurance?
Predatory practices can happen at any traditional insurance company, and they’re more common with savings insurance. Pure protection products rarely reach astronomical sums (like HK$100 million in coverage) and require strict underwriting. Savings plans, on the other hand, often skip underwriting. Some agents even inflate clients’ income or assets to pass affordability tests. Worse, certain agents push clients to mortgage properties for premium financing just to inflate the premium amount.
3 Tips to Avoid Being Taken Advantage Of
1. Be Extra Cautious with Savings Plans
Predatory tactics often target savings plans. Agents might overpromise returns using self-made brochures instead of official company proposals. So, here’s what you should do:
Insist on seeing the company’s official proposal and double-check all figures.
Scrutinize the contribution period, break-even point, and penalties or losses for early surrender.
Beyond the proposal, research the actual performance of similar products’ earliest versions. If the dividend realization rate isn’t 80-90% within 10 years, think twice.
2. Read Carefully Before Signing
Even if you’ve got a great agent, don’t blindly trust anyone. People can change, especially when big money is on the line. Some clients trust their agents so much they sign without reading, only to bear the consequences when things go south—and it’s tough to complain to regulators. For instance, affordability questionnaires are meant to protect you from oversized policies. Fill them out yourself, or if the agent does it, review every detail before signing.
3. Steer Clear of Premium Financing
Savings products from insurers typically offer annualized returns of just 3-6%, often taking 15-20 years to yield decent gains—and most returns aren’t guaranteed. Premium financing involves borrowing a large sum and paying interest, which fluctuates. Recently, rates have jumped from 2% to 5-6%, potentially leading to losses. High interest in the early years could make it worse than not financing at all. And if you terminate early, you might lose double-digit percentages of your principal.
1-Minute Check: Can You Qualify for Bowtie VHIS?
Thinking of switching to Bowtie but unsure if your current health condition qualifies for Bowtie VHIS? We’ve compiled the underwriting outcomes for the 26 most common conditions, so you can do a quick self-assessment. In just 1 minute, get a preliminary idea of whether your health status meets the criteria!
Click Here for Bowtie VHIS Preliminary Underwriting Test
Please note:
- This assessment is for a single health condition and is only a preliminary result, not a final underwriting decision or guarantee.
- If you have more than one health condition and wish to apply for our VHIS plan, we recommend completing a detailed health questionnaire for a full assessment.
- The final underwriting decision will be based on a complete health declaration.
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