South Korea: Mixed 1H profit results for insurance industry
Source: Asia Insurance Review | Oct 2016
The South Korean insurance industry saw combined net profits for the first half of the year fall from a year ago, with life insurers reporting a 17.9% fall in net gains to KRW2.29 trillion (US$2.04 billion) while nonlife insurers saw a year-on-year increase of 21.1% to KRW2.03 trillion.
According to the Financial Supervisory Service (FSS), the insurance industry in Korea posted a preliminary combined net income of KRW4.33 trillion in the first half of this year, a decrease of 3.3% from the first half last year.
The FSS said that non-life insurers’ improved performance reported higher investment income for the first six months of this year. Also, the loss ratio of non-life insurers decreased from 84.6% in 1H2015 to 83.1% in 1H2016. These insurers earned KRW37.37 trillion in premium income in the first half of the year, up 4.3%, with the sharpest increase seen in auto insurance.
For life insurers, the FSS said that the half-year performance declined because the increase in claims paid outpaced growth in premium income. Life insurers were also affected by prolonged low interest rates.