General insurers in South Korea are expecting to perform stronger this year than last year, thanks to higher interest rates and better motor insurance market conditions.
Experts project that Samsung Fire & Marine Insurance, the country’s largest general insurer, can achieve a net profit of KRW1.05 trillion (US$916.6 million), its highest-ever level. This would be a 25% increase from last year’s profit of KRW840.9 billion (US$740 million) and would exceed its target of KRW930 billion (US$818.4 million).
On June 13, Samsung Fire & Marine said in a regulatory filing that its net profit for the first five months of the year had already reached 70% of its annual target, reports Pulse News. Another boost to the company is its KRW200 billion sale of its building in Seoul. But according to analysts, even without the one-off gain from the sale, the company’s earnings still have a positive outlook.
Improving margins for motor insurance are also a positive factor for general insurers, with combined ratio dropping to 95% during the first five months of 2017, down from 100% for the same period last year.
Motor insurer Dongbu Insurance expects a 13% growth in its net profit for the entirety of 2017, reaching KRW532.3 (US$468.4 million)
Accumulated net profits of other general insurers in the market, such as Hyundai Marine & Fire Insurance and Meritz Fire & Marine Insurance, also increased by between 40% and 50% compared to a year earlier.
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