KUALA LUMPUR (April 13): Over half of Malaysian high-net-worth individuals were found to be more likely to adopt formal legacy plans, particularly life insurance, which is higher than the regional average and outpacing even wealthier Asian markets, according to a new study by HSBC Bank Malaysia Bhd.

In a statement, HSBC said the survey on High Net Worth Legacy Planning in Asia and the Middle East showed that 52% of Malaysian respondents with investable assets of at least US$2 million (RM7.95 million) had made formal plans for wealth transfer, compared with an average of 41% across nine markets.

It noted that life insurance has become the preferred legacy planning tool for high-net-worth individuals, surpassing traditional tools such as wills.

"Across the nine markets surveyed, 25% of high-net-worth individuals use life insurance as their primary or main legacy planning tool, with India leading, followed by Thailand and Indonesia. Malaysia is currently at 17%," said HSBC.

The survey was conducted by Ipsos Asia Ltd and involved 900 high-net-worth individuals from Hong Kong, Mainland China, India, Indonesia, Malaysia, Singapore, Taiwan, Thailand and the United Arab Emirates.

“High-net-worth individuals in Malaysia have a much greater sense of urgency for legacy planning, in part driven by strong gross domestic product (GDP) growth and rising incomes,” said HSBC.

The bank said Malaysia also recorded the highest share of respondents at 82% who began planning before the age of 50.

HSBC Malaysia's country head of international wealth and premier banking, Linda Yip, said the primary driver leading Malaysians to adopt formal legacy plans early was family considerations, particularly to avoid potential financial disputes within the family.

“Asia is in the midst of one of the largest transfers of wealth to the next generation in its history, and Malaysia is very much part of that shift,” said Yip in the statement, adding that she observed a growing number of younger high-net-worth individuals in Malaysia.