Social Networks and Economic Actions: An Study of Cross-border Life Insurance Transactions between Hong Kong and Mainland China in the face of COVID-19 pandemic

Since the Mainland and Hong Kong Closer Economic Partnership Agreement was launched in 2003, it has stimulated the cross-border economy and interpersonal interaction between Hong Kong and Mainland China. However, due to the lingering impact of COVID-19, the Chinese Central Government maintains a 'dynamic' zero-COVID strategy, while the HKSAR government has adopted a time-varying strategy to deal with the ongoing challenge. Physical interactions between Hong Kong and the Mainland were hindered to some degree by such different institutional arrangements. A special focus was placed on Hong Kong's life insurance industry in this paper, which adopted a social networks approach to examine how cross-border economic activities would be maintained in the face of COVID-19. The study addresses two issues, including (i) how Hong Kong's life insurance agents echo the new arrangements between Hong Kong and Mainland China, and (ii) how trust is maintained in business relationships that cross borders under the pandemic. Preliminary data based on three months' observation in the life insurance industry and eight in-depth interviews with life insurance agents show that mainland background agents were applying an alternative sales strategy. Instead of promoting Hong Kong's life insurance policy, the agents used social media to gain virtual exposure among Mainland clients by promoting themselves as reliable individuals. Additionally, many agents choose to locate on the mainland rather than in Hong Kong, in order to gain more physical interaction with clients and potential clients as well as build trust relationships as they wait for future business opportunities. The findings suggest that business relationships are maintained by individuals consciously and proactively online and offline. Evidence also points to the importance of physical and virtual interaction in the development of trust relationships.