In 2022, the Korean life insurance market remained resilient, backed by a spike in savings insurance premiums. Compared to savings deposit products, savings-type insurance became less competitive in terms of interest rates, but the sales of savings insurance surged in step with the general trend of rising interest rates. Protection insurance premiums also grew steadily, albeit at a slower pace, mainly in disease and health covers. The growth was achieved despite weakened new product development in the wake of the regulator’s strengthened consumer protection.

The domestic life reinsurance market is estimated to have grown by 46.7% from KRW 2.139 trillion a year earlier to KRW 3.138 trillion. Korean Re is expected to maintain its market share at 35%, while focusing on building a profit-oriented portfolio by reducing the volume of its low-margin treaty business.

Our Domestic Life & Health Team’s premium income increased by 0.6% to KRW 862 billion thanks to the active acquisition of new contracts and co-development of products with primary insurers. Our net underwriting results improved by KRW 21.2 billion to KRW 39.1 billion because of a decrease in the loss ratio of medical expense insurance.

In 2023, life insurance premiums in Korea are expected to fall modestly. Despite decreasing new demand for whole life insurance, protection insurance is forecast to grow by 2.3%, driven by renewal premiums. Savings-type insurance is projected to decrease by 2.0% considering its weakening interest rate competitiveness because of relatively higher interest rates on deposit products.

The life insurance industry is faced with rising uncertainty in terms of economic conditions, new regulations and future growth potential. In particular, the economy is likely to struggle with low growth due to continued volatility in financial markets, which will be the result of the expansion of inflationary pressures and a full-blown economic slowdown.

A domestic economic downturn is expected to have a negative impact on the insurance industry’s growth and profitability, undermining the foundation of long-term growth. Increased financial market volatility and high inflation will likely hamper insurance market growth due to sluggish sales of insurance with savings and investment components. Weak private consumption may also hold back the growth of protection insurance sales.

In the face of the combination of these headwinds, we will step up our efforts to drive profitable business growth. We will remain well-prepared for market developments and regulatory changes such as IFRS 17 by strengthening our expertise in new products, including coinsurance. On top of that, we will firmly cement our position as a leader in the domestic life reinsurance market by actively providing underwriting technical services that meet the needs of primary insurance companies. Finally, profit-oriented underwriting will be pursued through preemptive risk management and portfolio analysis, such as monitoring our in-force business.