Insurance companies in South Korea, comprising 22 life insurers and 31 non-life insurers, generated KRW9.37 ($7bn) in preliminary net income for the first half of 2024, up by KRW253.6bn or 2.8% from the corresponding period a year earlier, according to preliminary data released yesterday by the Financial Supervisory Service.
The combined net income of life insurance companies dropped by 9.4% year on year to KRW3.59tn. While insurance income increased from a year ago, investment income plunged due to losses on valuation of financial assets.
On the other hand, the aggregate net income of non-life insurance companies, net income increased KRW627.7bn or 12.2% from a year ago. Their insurance income expanded mostly due to growing sales of insurance plans and lower incurred claims. By contrast, the non-life insurers’ investment income decreased compared to a year ago.
-
|
|
1H2024
|
1H2023
|
Change
|
|
KRW bn
|
KRW bn
|
%
|
|
Preliminary net income
|
|
Life insurance companies
|
3,594.1
|
3,968.2
|
-9.4
|
|
Insurance income
|
2,934.8
|
2,785.4
|
5.4
|
|
Investment income
|
1,751.6
|
2,309.5
|
-24.2
|
|
Other income
|
-94.3
|
-87.0
|
8.4
|
|
Non-life insurance companies
|
5,772.2
|
5,144.5
|
12.2
|
|
Insurance income
|
5,794.5
|
4,970.7
|
16.6
|
|
Investment income
|
1,857.2
|
1,875.1
|
-1.0
|
|
Other income
|
-21.0
|
-2.5
|
-640.0
|
|
Total
|
9,366.3
|
9,112.7
|
2.8
|
|
Preliminary Premium Income
|
|
Life insurance companies
|
54,473.8
|
52,626.7
|
3.5
|
|
Protection-type insurance
|
26,793.6
|
23,663.1
|
13.2
|
|
Savings-type insurance
|
15,077.4
|
14,971.3
|
0.7
|
|
Variable life insurance
|
6,112.8
|
6,250.2
|
-2.2
|
|
Retirement pension and others
|
6,490.0
|
7,742.1
|
-16.2
|
|
Non-life insurance companies
|
61,218.0
|
58,709.5
|
4.3
|
|
Long-term insurance
|
34,381.7
|
32,696.6
|
5.2
|
|
Auto insurance
|
10,565.1
|
10,688.3
|
-1.2
|
|
General insurance
|
7,974.1
|
7,339.0
|
8.7
|
|
Retirement pension and others
|
8,297.1
|
7,985.6
|
3.9
|
|
Total
|
115,691.8
|
111,336.2
|
3.9
|
Premium income
The insurance companies’ combined premium income for the first six months of 2024 totalled KRW115.69bn, up by KRW4.36tn or 3.9% from the corresponding period a year ago.
Premium income of life insurance companies grew by KRW1.85tn or 3.5% to KRW54.47tn during the period. Premiums from protection-type and savings-type insurance plans expanded by 13.2% and 0.7%, respectively, year on year. By contrast, retirement pension contributions decreased by 16.2%, and variable life insurance premiums shrank by 2.2% as well.
Non-life insurance companies’ premium income reached KRW61.22tn in the first half of 2024, up by KRW2.51tn or 4.3% from a year ago. In particular, long-term insurance increased by 5.2% as well as general insurance jumped by 8.7% year on year. Also, retirement pension grew 3.9% from the corresponding period a year ago. However, auto insurance decreased by 1.2% during 1H2024.
Return on assets (ROA) fell by 0.04ppt to 1.52% in 1H2024. However, return on equity (ROE) jumped by 0.72ppt to 11.79%.
Looking ahead
Domestic insurance companies need to manage their financial stability amid concerns about potential losses in relation to real estate project financing projects in the domestic market and overseas commercial property investments as well as mounting uncertainty about financial markets around the world.
Against this backdrop, the Financial Supervisory Service will closely look into the financial position of domestic insurance companies and carry out a thorough off-site monitoring of major risk factors.