According to the Financial Supervisory Service, South Korean insurers reported a preliminary net income of $2.99 billion (KRW 4.0967 trillion) for the first quarter of 2025. This represents a 15.8% decrease compared to the same period last year.
Life Insurers See 10.9% Decline in Net Income
Life insurance companies posted net income of $1.24 billion (KRW 1.6956 trillion), down 10.9% year-on-year. The decline is mainly due to higher expenses from onerous contracts. In addition, insurers experienced lower valuation gains on retained assets and reduced income from the sale of financial assets. These factors contributed to a drop of $89.8 million (KRW 123 billion) in insurance income and a $116.7 million (KRW 159.8 billion) fall in investment income.
Non-Life Insurers’ Earnings Down 19% Amid Rising Loss Ratios
Non-life insurers reported a net income of $1.75 billion (KRW 2.4011 trillion), a 19.0% year-on-year decline. The decrease was largely driven by a $793 million (KRW 1.0863 trillion) reduction in insurance income, caused by an increase in loss ratios. However, this loss was partially offset by a $305.3 million (KRW 418.2 billion) rise in investment income, thanks to higher bond valuations.
Premium Income Shows Growth Across the Industry
Despite the earnings decline, the total premium income of the insurance industry increased by 6.9% year-on-year to $45.79 billion (KRW 62.7311 trillion) in Q1 2025.
Life insurers contributed $22.71 billion (KRW 31.1121 trillion), an 11.0% increase compared to the previous year. Growth was driven by a 12.5% rise in protection plans, an 8.8% increase in variable insurance, and a substantial 69.7% jump in pension-related products. However, savings insurance premiums fell by 13.4%.
Non-life insurers recorded premium income of $23.08 billion (KRW 31.619 trillion), up 3.2% year-on-year. Long-term insurance grew by 6.6%, general insurance increased by 4.4%, but premiums from auto insurance and pensions declined by 2.9% and 3.3%, respectively.
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