Review of Overseas Business Operations of Korean Insurance Companies in 2021
As of the end of 2021, there were 11 Korean insurers (four life insurers and seven non-life insurers) that had overseas operations. The total number of their overseas business units increased to 38 in 2021 from 35 in 2020. A subsidiary is the most common form of overseas entities, with 27 subsidiaries and 11 branches as of late 2021. Their presences span 11 different countries around the world. Many of the overseas business operations of Korean insurers are based in Asia, with five in China and Vietnam each and four in Indonesia. Outside Asia, there are 11 units in the United States and three in the United Kingdom. In 2021, three new operations were set up – two subsidiaries in the U.S. by Korean Re and DB Insurance and one in Vietnam by Shinhan Life Insurance.
In 2021, the Korean insurance industry saw their business results from overseas operations improve substantially thanks to premium income growth. Their collective net income soared by 99.1% year on year to USD 90.8 million. Insurance business operations reported USD 90.6 million in net income, up 47.3% from the previous year. Financial investment operations and others turned to profit with a net income of USD 0.2 million. Although the business results varied by country to country, operations in Asia and the U.S. showed better performance.
Life insurers reported better business results compared to the previous year on the back of non-insurance operations, but they continued to suffer setbacks on the face-to-face marketing front amid the COVID-19 pandemic. Non-life insurers also experienced a rise in profit, which mostly came from businesses with their affiliates and Korean corporations operating abroad.
As of the end of 2021, the total assets held by the overseas business operations of Korean insurers jumped by 21.3% to USD 6.56 billion. Their liabilities also increased by 32% to USD 3.96 billion due to premium reserve growth among non-life insurers. The amount of total equity rose by 7.8% to USD 2.6 billion, driven by strong net income growth and paid-up capital for new entities.