Long-term Insurance Increased by 247.6% to 865 Billion Won in a Year
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| Exterior view of Hyundai Marine & Fire Insurance headquarters in Jongno-gu, Seoul. [Provided by Hyundai Marine & Fire Insurance] |
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, ‘[Herald Economy=Reporter Park Sung-joon] On the 21st, Hyundai Marine & Fire Insurance announced that it recorded a net profit of 1.0307 trillion won on a consolidated basis last year. This is an increase of 33.4% compared to the previous year (772.3 billion won), marking its entry into the ‘1 Trillion Won Club’ for net profit for the first time. This growth was mainly due to an increase in insurance profits, centering on long-term insurance.’,
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, ‘Revenue grew by 8.2% from the previous year to 17.2193 trillion won, and operating profit jumped by 42.8% to 1.4019 trillion won compared to the previous year.’,
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, ‘Insurance profits recorded 1.043 trillion won, a 98.1% growth compared to the previous year (527 billion won). In particular, the profitability of long-term insurance increased significantly. The long-term insurance profit surged 247.6% to 865 billion won compared to the previous year (249 billion won). Despite the expansion of the deficit in insurance payment due to the increase in epidemics such as influenza patients last year, the impacts such as the increase in actual-loss insurance rates led to a reduction in costs related to loss-bearing contracts.’,
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, ‘General insurance profits also increased to 158.6 billion won, up 107.5% from the previous year, as the trend of increasing insurance premiums continued and the frequency of large-scale accidents decreased. However, in car insurance, as the trend of premium reductions continued with seasonal factors like heavy snowfall in the fourth quarter, accident rates increased, leading to a 90.5% decline in profits, amounting to only 19.2 billion won.’,
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, ‘Investment profits were recorded at 352.1 billion won. Although interest income increased due to the improvement in retained earnings, investment profits decreased by 21.9% from the previous year due to the base effect from the increase in bond valuation and dividend income in the previous year.’,
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, ‘Due to the changes in the no/lapse insurance surrender rate system applied by the financial authorities last November, both the Contractual Service Margin (CSM) and the Solvency Margin Ratio (K-ICS, KIX) declined. The CSM recorded 8.2477 trillion won, a decrease of 9.2% compared to a year earlier. KIX stood at 155.8% at the end of last year, a 17.4 percentage point drop during the same period. This is close to the financial authorities’ recommended threshold of 150%. The decline in KIX was also influenced by the reduction in the discount rate of insurance liabilities and capital decrease due to market interest rate declines.’,
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, ‘A Hyundai Marine & Fire Insurance representative stated, “We will strive to improve the CSM by promoting long-term new contract CSM growth and building a portfolio of highly profitable products,” adding, “We will also manage the KIX by expanding asset duration, issuing equity securities, and pushing for reinsurance.”’,
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