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Photo courtesy of Samsung Fire & Marine Insurance |
[Alpha Biz= Paul Lee] Last year, auto insurance incurred a loss for the first time in four years. This is attributed to a decline in auto insurance premiums and an increase in the loss ratio.
According to the '2024 Auto Insurance Business Performance (Provisional)' report released by the Financial Supervisory Service on April 6, the total revenue (gross premiums written) for auto insurance last year was 20.6641 trillion KRW, which is a 1.8% decrease compared to the previous year (21.0484 trillion KRW).
The auto insurance underwriting result for last year showed a deficit of 9.7 billion KRW. This marks the first loss since 2020. The decrease in premium income and the increase in the number of accidents led to a higher loss. Insurance companies have been reducing premiums for four consecutive years since 2022 under pressure from financial authorities to promote financial cooperation. The loss ratio for auto insurance rose to 83.8%, up by 3.1 percentage points from 80.7% the previous year.
However, the investment income from the insurance premiums managed by insurers recorded a surplus of 598.8 billion KRW last year. As a result, the total profit of auto insurance (underwriting result + investment income) amounted to 589.1 billion KRW.
In terms of market share, the four major players—Samsung Fire & Marine Insurance, Hyundai Marine & Fire Insurance, DB Insurance, and KB Insurance—accounted for 85.3%. The share of medium and small-sized companies such as Meritz Fire & Marine Insurance and Hanwha General Insurance stood at 8.3%, while the share of non-face-to-face specialists like Carrot General Insurance and AXA Insurance was 6.4%.
Looking at the sales channels, the highest proportion was from face-to-face sales, which accounted for 47.8%. This was followed by online (CM) at 35.8%, telemarketing (TM) at 16.0%, and platform-based (PM) sales at 0.4%.
Alphabiz Reporter Paul Lee(hoondork1977@alphabiz.co.kr)
