Refer Report
Last year, every life and non-life insurer made a net profit, but the insurers’ health indicators, K-ICS, dropped significantly. Some small and medium -sized insurers are expected to come out of the financial authorities’ recommendations (more than 150%).
According to the insurance industry on the 23rd, NH Nonghyup Insurance’s payment rate was 175.75%at the end of last year, down 141 percentage points from a year ago. Samsung Life is 180%, down about 39 percentage points in the same period, Shinhan Life fell 44 percentage points to 206.8%, KB Insurance fell 27.8 percentage points to 188.1%, and KB Life fell 64.5 percentage points to 265.3%. Hyundai Maritime fell 17.4 percentage points to 155.8%, and Tong Yang Life fell by 38.7 percentage points to 154.7%. In the case of Lotte Insurance, the rate of limitations was 159.77%as of the end of September last year, and the industry is likely to be below 150%at the end of the fourth quarter. Payment rate (available capital/payment requirements) is an indicator of whether an insurance company can pay insurance in time.
Last year, net profit of five non -signed companies, including Samsung and Meritz Fire & Marine Insurance, increased by 16.6% year -on -year to 7.40 trillion won. Life insurance companies also increased 11 to 17% of Samsung Life Insurance, Hanwha Life, Shinhan Life, Dongyang Life, and KB Life, respectively. Even though the net profit has increased significantly, the factor that has plummeted the payment rate is a reflection of the guidelines for the negligence of the financial authorities. As the guidelines assuming the insurance termination rate were applied, the number of insurers’ available capital decreased, resulting in a decrease in the rate of limitations. Lowing market interest rates and lowering insurance contracts (debt) discounts are also a factor that reduces the rate of limitations. The industry explained, “Small and medium -sized companies with no diverse insurance portfolios have been hit more by the ratio of limitations because of the high proportion of non -impairment insurance.”
The insurance industry is defending a decline in the ratio of limitations by expansion of capital through new capital securities and subordinated bonds. Since the beginning of this year, each insurer has issued or is preparing or preparing for subordinated bonds or capital securities. The industry said, “It is estimated that insurers pay more than 1 trillion won annually to issue subordinate bonds. The cost of capital is getting bigger. ”
Reporter Cho Gye -wan kyuan@hani.co.kr
Source: Korean