South Korean insurance companies' net income totalled KRW2.78 trillion (US$2.4 billion) in the first quarter of this year, up 24.4% from a year ago, according to the Financial Supervisory Service (FSS).
The regulator pointed out that the improved performance is mainly because of one-off profits, reported Business Korea.
The FSS said that insurers are still required to improve the qualitative aspect of their income by means of risk management and efforts to ensure sustainable profits.
The net income of nonlife insurance companies reached KRW1.2 trillion with a year-on-year growth of 32.8%. This can be attributed to a decline in their loss ratio from 82.2% to 78.0% following the recent car insurance reform, which added KRW149 billion to their net income. The net income included insurers' gains from the disposal of real estate that reached KRW257.5 billion.
The net profit of life insurers increased by 18.6% to KRW1.57 trillion, which included dividend income of KRW227.9 billion that rose in the bullish domestic stock market and investment profits of KRW274.7 billion that included gains from the disposal of securities.
At the same time, premium revenues of life insurance companies fell 1.6% in 1Q2017 from a year earlier to KRW28.52 trillion whereas that of nonlife insurers rose by 4.0% to KRW19.18 trillion, led by a 7.5% increase in the motor insurance segment.