Media365
Asia is at the forefront of one of the largest wealth transitions in history. An estimated US$5.8 trillion of wealth is expected to pass from high-net-worth (HNW) and ultra-high-net-worth (UHNW) founding generations to their successors by 2030, structurally transforming the way they preserve, enhance and transfer their wealth.
Yet for many family-owned businesses, succession planning can be an emotive topic. Intergenerational wealth transfer goes beyond the passing down of assets – it is about ensuring financial security while preserving values and traditions. By tailoring legacy planning to include both tangible assets and intangible guidance, HNW and UHNW families can adopt strategies that support future generations emotionally, ethically and financially. Financial expertise aligned with a deep understanding of generational family dynamics plays a pivotal role in making the transition seamless.
“Life insurance and structured planning are becoming central to intergenerational wealth strategies,” said Lawrence Lam, CEO of Prudential Hong Kong and Macau, an event sponsor at a recent forum on Next Generation Wealth, part of the South China Morning Post’s Redefining Hong Kong series, adding that families are adopting more nuanced approaches that reflect “aspirations for quality of life, seamless inheritance and sustainable wealth management”.
While individuals and families in Hong Kong and the region rethink financial stewardship and the use of smarter, more relevant wealth management structures such as life insurance solutions, initiating discussions around family legacy might still feel daunting, said Priscilla Ng, group chief customer and wealth officer at Prudential, speaking at the event.
In addition to flexibility, financial strength is critical for families seeking security across generations. Prudential, she said, has a long-standing reputation for stability and reliability complemented by robust risk management, strong governance and innovative solutions, all key elements for clients seeking growth while ensuring resilience and continuity.
“To ensure smooth wealth transfer across generations, and provide lasting security and continuity for loved ones, HNW and UHNW families should look beyond short-term market movements and focus on long-term stability,” added Lam. “Insurance solutions should be adopted with a forward-looking mindset to support effective succession planning.
“If you’re a family matriarch or patriarch, you’d also look for a strategy that offers flexibility in terms of currency selection and across life stages, as well as identifying future successors,” he said. To address these challenges, accumulate wealth and help prepare for the unexpected, Prudential offers plans with trust-like elements that empower policyholders to define and manage their goals and objectives.
Ng stressed the importance of proactive conversations. Families need to have open discussions about the issue of wealth transfer and legacy planning. Collaboration strengthens familial bonds and ensures a deeper emotional investment in the family’s future. Without these crucial conversations, “heirs might be left unprepared to handle the complexity of their family assets and their tax implications,” Ng said, adding that one of the keys to success in succession planning is to be thoroughly prepared for matters such as ownership transitions.
When it comes to wealth transfer, innovative insurance policy plans offer flexible payout options that can be used to equalise inheritances, which fit well with whatever the next generations choose to do, Ng said. “For instance, a parent can pass the business to an offspring, while keeping a proportion of money to pass on to other children.”
While joining the family business to continue the line of succession and win the approval of the previous generation is an option for any aspiring successor, it is not a straightforward decision, said another speaker at the event, Giulio Pesenti, head of strategic business development and board member at Clessidra Group, an Italian alternative investment platform owned by family-controlled Italmobiliare.
“It’s much easier to stay outside [the family business]. I think younger generations nowadays understand that. It is also true that maybe not everyone knows how to handle money. But I also think there are many more skills now in the family that have to find their way of becoming useful,” said Pesenti.
While members of the founding or senior generation are often in charge of succession planning, speaker Marshall Jen, executive director of CUHK Centre for Family Business, stressed the importance of involving the younger generation in discussions over wealth management and distribution. “It’s important to consider who is going to understand that plan and manage the succession forward; this kind of conversation can help the next generation,” he said, adding that this can help prepare them to be good stewards of wealth and enable them to understand their evolving roles and responsibilities in the succession plan.
Besides the inclusion of input from younger generations, flexibility and adaptability are also crucial to structuring a plan in intergenerational wealth transfer. That includes prioritising insurance and asset management partners with a proven track record and flexibility to tailor plans and adjust protection as required.
Insurance strategies are not only helpful but also foundational to business succession planning. These structures can help families gain lock-in and enable flexible legacy transfer across generations.
Prudential’s customer-focused approach can help HNW and UHNW families manage wealth with a purpose other than preservation, according to Lam. “We’ve shifted from a product-centric approach to providing families with a holistic, forward-looking proposition.”
With a dedicated wealth office and strategic partnerships through Eastspring Investments, Prudential offers families a forward-looking proposition, combining protection, growth and purpose to ensure legacies endure for generations.
“Clients can benefit from our integrated solutions supporting financial resilience and legacy planning,” Lam said.
Disclaimer from Prudential:
The figures and analysis presented in this article are for reference only and should not be taken at face value for financial decisions.
