South Korea’s life insurance industry is projected to grow steadily over the coming years, reaching KRW206.2 trillion (US$157.9 billion) in direct written premiums (DWP) by 2029, according to GlobalData.
This figure represents a compound annual growth rate (CAGR) of 3.1% from KRW182.7 trillion ($139.8 billion) in 2025.
The recovery comes after a 9.2% contraction in 2023, with growth expected to resume in 2024 and 2025. Improved economic conditions and demographic changes, particularly the aging population, are expected to support demand for products such as whole-life and pension insurance.
Prasanth Katam, an insurance analyst at GlobalData, noted that South Korea’s economy grew by only 1.4% in 2023, which dampened interest in life insurance. However, a rebound to 2.2% growth in 2024 and 1.8% in 2025 is forecast, likely bolstering demand for long-term insurance products.
Pension insurance is expected to remain the leading product category, accounting for 39.7% of DWP in 2024. It has shown robust growth, with an increase of 4.7% in 2024, driven by favourable investment returns.
The National Pension Service of South Korea reported a 9.2% return on investments for the first nine months of 2024, amounting to KRW97 trillion (US$70 billion). Strong gains from foreign equity markets played a significant role in this performance, encouraging consumers to allocate more funds toward pension plans. Over the 2025-2029 period, pension insurance is projected to grow at a CAGR of 4.7%.
Whole-life insurance, the second-largest segment, is forecast to hold 12.4% of the market in 2024. This product line is expected to grow at a 1.2% CAGR through 2029, as insurers cater to South Korea’s aging population.
By 2025, individuals aged 65 and older are expected to comprise 20.3% of the population, a proportion that could rise to nearly 40% by 2050. These demographic shifts are likely to sustain demand for whole-life policies.
Endowment insurance, which provides higher returns compared to other financial instruments, accounted for 11.1% of DWP in 2024. Its growth is linked to lower interest rates, such as the average 3.6% rate on new deposits recorded in February 2024 by the Bank of Korea. With interest rates on deposits declining, endowment products are becoming a more attractive option for consumers, contributing to a projected CAGR of 1.4% through 2029.
In addition to pension and whole-life insurance, products such as term life, general annuity, and other life policies are collectively expected to make up 36.9% of DWP in 2024. These lines are also expected to grow steadily as insurers adapt to evolving consumer needs.
Katam said the industry is positioned for consistent growth, supported by economic recovery and the increasing need for long-term and retirement-focused products.
“The changing market dynamics will prompt insurers to offer policies for the aging population, which are likely to contribute to the industry’s growth over the next five years,” he said.
