Richard Li: the tech nerd taking on the insurance companies

Two decades ago, Richard Li, the second son of Hong Kong’s richest man, Li Ka-shing, was going through a techie phase. Sporting a T-shirt and a backpack, he stuck out on Hong Kong’s streets as a far more visible presence than his staid elder brother Victor.

Today, at 52, the younger Mr Li prefers the shade to the limelight. Although he was educated in Silicon Valley, at Menlo College and Stanford University, and might have had the appearance of a tech entrepreneur, he never made it in that industry.

Instead, he has emerged as a force in the most conservative, traditional and undisrupted corner of finance: insurance.

As the founder of FWD, an insurance group backed by Swiss Re that spans Asia, Mr Li made two acquisitions in the last week of businesses in Thailand and in Hong Kong, worth a combined $3.3bn.

The deals have shown Mr Li’s ambition for expansion, in an effort — ambitious and possibly premature — to challenge the two dominant players in the region, AIA and Prudential.

Rival insurers, some of which confess to being sceptical at first, now say that he has the focus, the ability to find the right people and to execute.

“He is a visionary,” said Henry Cornell, former vice-chairman of Goldman Sachs Merchant Bank and now head of Cornell Capital, an investment firm with offices in New York and Hong Kong. “Ahead of his time and hardworking.”

Associates describe Mr Li as a detail-oriented workaholic who will fly to London for a meeting and return instantly to Hong Kong, pausing only to take a shower in the airport lounge.

Sometimes using his Canadian passport, he flies commercially, which counts as austerity for one of the wealthiest residents of Hong Kong, with a net worth of $4.5bn, according to Forbes.

At one recent morning meeting at the Hong Kong Club, Mr Li’s breakfast consisted of half an avocado and a cup of weak tea.

“The first generation instilled great discipline in the kids,” said one former HSBC executive.

The senior Mr Li, now 90, retired in 2018 as chairman of his conglomerates CK Hutchison Holdings and CK Asset Holdings. Five years ago he described his youngest son as having “a playful nature but is also serious about his work. His career has been improving, which gives me peace of mind”.

As technology finally starts to impact the dinosaur insurance world, Mr Li will have to adapt. Hong Kong has already started to award virtual insurance licences.

The first licensee, Bowtie Life Insurance, launched its voluntary health insurance business in early April. Joe Tsai, the number two of Alibaba and Ant Financial, has mused publicly about starting an online insurance business in the region.

Even as he builds his offline insurance business with the purchase of Siam Commercial Bank’s insurance arm and the Hong Kong operations of MetLife, Mr Li is also quietly building a digital operation out of Singapore that will be run separately from FWD, his main insurance vehicle, with two different, newly recruited teams.

Moreover, future expansion in markets such as India will be more virtual than physical. “Going forward everything will be hybrid — not either or,” said the former head of one of the dominant players in the region. “Everything is a combination of robo services and humans, everything is digital to some extent. It just isn’t always visible.”

Nevertheless, there is still a lingering question about whether it is too late to build an insurance business that can one day rival the two regional giants.

“If you are going to do it anywhere in the world, this is the region you would do it in,” said the former insurance chief executive. “This is the part of the world that is growing, given the scale of the emerging mass affluent class. And because of the growth, getting market share here is not a zero-sum game as is the case elsewhere.”

In earlier days, Mr Li was widely seen as the wayward son, mercurial and occasionally petulant. “But today he has totally reinvented himself,” said the former HSBC banker. “He has found his own path. It is a very Hong Kong story.”

* This article has been amended to show that Richard Li is the founder of FWD