SEOUL, Aug. 17 (Korea Bizwire) – In the first half of the year, insurance companies in Korea made net profits of 4.5 trillion won, powered by a surge in one-time profits such as sales of equities.
According to the Financial Supervisory Service (FSS) on August 16, the combined net income of 39 insurance firms in Korea increased to 4.47 trillion won, an increase of 30.2 percent or 1.04 trillion won from the same period of the previous year.
The net profits of life insurance firms surged to 2.8 trillion won, up 40.2 percent or 803 billion won year on year, and those of non-life insurance companies jumped 16.3 percent to 1.67 trillion won.
The FSS said that sales of equities raised their net incomes. As low interest rates linger, companies increased non-recurring profits by selling equities.
In the case of life insurers, they gained more as their incomes were increased centering on term insurance. However, non-life insurance companies saw a limited range of income due to the loss ratio of automobile insurance and long-term policies.
Meanwhile, their combined premium income gained 5.5 percent or 4.8 trillion won to 91 trillion won during the first half.
As of June, their total assets stood at 903.3 trillion won, a jump of 11.5 percent or 93.2 trillion won.
The FSS recommended that insurance companies stabilize their profit structures and expand their assets in preparation for the forthcoming interest rate changes and the introduction of international accounting standards.
By John Choi (email@example.com)