Sales of non-life insurance products via the Internet in South Korea rose for 2016, as insurers released affordable online-only insurance products to attract more customers, according to industry data.
The General Insurance Association of Korea revealed that non-life insurers raked in KRW1.4 trillion (US$1.19 billion) in premiums through online sales for 2016, a 34.3% increase from the previous year.
The growth in online sales far outstripped the 1.3% year-on-year growth for all insurance premiums, signifying robust growth in the online channels.
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Selling of insurance products online is much cheaper than selling face-to-face via the traditional agents and brokers setup. In November 2015, insurers have introduced a unified online platform to sell products. As profit margins are higher in online sales, it could potentially eat into agents’ and brokers’ business models, especially as clients become more tech-savvy.
At present, however, offline insurance sales still rule the industry, with KRW51.2 trillion (US$43.6 billion) in premium income for 2016, making up 89.5% of all insurance premiums.
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