South Korean non-life insurers saw surge in motor insurance premiums on pent-up demand for luxury import cars.
Overseas branches of South Korean insurance firms have reported a 34.8% drop in their combined net profit for 2020, mainly due to the impact of the COVID-19 pandemic.
Fraudulent insurance claims increased by 2% last year, partly due to a rise in minor fraud cases as the COVID-19 pandemic hit the economy, the financial regulator has said.
Falling profits and rising costs have been cited as the main reasons for foreign financial institutions, including insurers and banks, leaving South Korea.
China-headquartered Leapstack, an AI-enabled InsurTech company specialising in healthcare, has announced a strategic plan to ink strategic partnerships with multiple Korean insurance companies as the company advances into the South Korean market.
The Ministry of Land, Infrastructure and Transport announced last month that all insurance payouts will be charged to motorists who cause accidents when they drive while they are under the influence, or when they don't have a driving licence or who are involved in hit-and-run accidents.
The loan balances of insurance companies in South Korea rose by 7.8% at the end of last year, compared to end-2019, led by increases in home-backed lending and corporate loans, the Financial Supervisory Service (FSS) has said.
Environmental, social and corporate governance (ESG) issues are attracting more interest in the local insurance sector, in line with the global ESG trend.
Insurers in South Korea reported a 13.9% increase in combined net profit in 2020, compared to 2019, due partly to fewer car accidents as people stayed home during the coronavirus pandemic.
The financial performance of South Korea's second largest life insurer Hanwha Life Insurance is deemed 'Good', although persistently low interest rates are likely to suppress the life insurer's earnings growth, says Fitch Ratings.