Hanwha Life reported a consolidated net income of 461.5 billion KRW for the first half of this year, marking a 30.8% decrease from the previous year. Excluding its subsidiaries like Hanwha General Insurance and Hanwha Life Financial Services, the standalone net income came to 179.7 billion KRW, a 48.3% decline year-on-year.
According to Hanwha Life, both insurance and investment profits decreased, leading to a drop in net income for the first half of this year. The insurance profit stood at 176 billion KRW, which is a 35.9% reduction compared to the same period last year, while the investment profit was 40.5 billion KRW during the same period.
The Annualized Premium Equivalent (APE), a key insurance sales growth indicator, was 1.7656 trillion KRW for the first half of this year, down 8.0% from a year ago. However, solely for the second quarter, new contract APE increased by 8.7% year-over-year, reaching 884.4 billion KRW.
The core profitability indicator, the Contract Service Margin (CSM) for new contracts, achieved 925.5 billion KRW in the first half, down 7.0% from a year ago, but it is expected to exceed 2 trillion KRW this year. Hanwha Life expanded the sales of health insurance products and enhanced product profitability, achieving over 2 trillion KRW in new contract CSM for two consecutive years in 2023 and 2024.
Despite interest rate cuts and increased competition, the new contract CSM profitability for health insurance was 15.3 times in the first half, an improvement from last year’s 14.4 times. The profitability for whole life insurance also increased from 3.3 times to 3.4 times.
As of the end of June this year, the number of insurance planners (FPs) affiliated with Hanwha Life’s subsidiary General Agency (GA) increased by about 4,700 from the end of last year, totaling 35,705. Hanwha Life stated that the systematic training and development system enhanced organizational stability, raising the 13th installment retention rate by 6.0 percentage points to 55.7% compared to the end of last year.
The 25th installment contract retention rate, an indicator of sales efficiency, rose by 16.3 percentage points to 80.1% compared to the end of last year. The solvency margin ratio (K-ICS), indicating financial soundness, increased by 7 percentage points to 161% from the previous quarter. The duration gap was reduced by 0.19 years to 0.08 years compared to the previous quarter.
A Hanwha Life representative stated, “Through the expansion of product sales that meet customer needs and efforts to diversify portfolios, key indicators such as the profitability of health insurance and contract retention rates have improved,” adding, “We expect to secure stable CSM for retained contracts in the medium to long term.”