Foreign Insurance Companies Amid Sale Rumors...Smile Brightens with Strong Earnings

MetLife Net Profit Up 35%
ABL Life Successfully Returns to Profit

[Asia Economy Reporter Oh Hyung-gil] Foreign life insurance companies, which were rumored to be sold one after another last year, recorded strong performance despite the impact of COVID-19.

The results are noteworthy as they were achieved amid pessimistic business forecasts that predicted withdrawal from the Korean market due to continued low interest rates and a stagnant domestic insurance market.

According to the insurance industry on the 9th, the US-based MetLife announced that its net profit last year was 137 billion KRW, a 35.3% increase from 101.3 billion KRW the previous year. Total assets increased by 8.3%, from 21.6218 trillion KRW to 23.4247 trillion KRW.

A MetLife official explained, "Premium income increased and business expense reduction effects appeared," adding, "The decrease in the amount transferred to the reserve for policyholder liabilities also occurred as the rate of interest decline slowed."

MetLife, which entered the Korean market in 1989, has been caught up in sale rumors in recent years. Although it has grown steadily by introducing variable insurance products to the domestic market, it has been mentioned as a likely next sale candidate following the sales of Orange Life and Prudential Life to Shinhan Financial Group and KB Financial Group, respectively.

Dongyang Life and ABL Life, which were not free from sale rumors amid the crisis of their Chinese major shareholder Anbang Insurance Group, also improved their performance last year.

ABL Life recorded a net profit of 91.2 billion KRW on a consolidated basis last year, successfully turning a profit. It explained that corporate tax income was generated due to the recognition of deferred tax assets on the adequacy evaluation amount of policyholder reserves.

Dongyang Life also achieved a net profit of 128.6 billion KRW, up 14.5% from the previous year. Sales reached 6.949 trillion KRW, up 11.1%, and operating profit surged 61.0% to 177.6 billion KRW. It is analyzed that the effect of adjusting the main product group from savings insurance to protection insurance is appearing.

Hong Kong-based AIA Life also achieved a net profit of 157.2 billion KRW, soaring 92.0% compared to the previous year. An AIA Life official said, "Stock-related gains increased due to the stock market boom, and although cancellations increased after COVID-19, the reversal of policyholder reserves increased significantly, improving net profit."

In November last year, Peter Jung, CEO of AIA Life, directly dismissed sale rumors, saying, "We operate in 18 markets across Asia and have not left any market so far." AIA Life is attempting differentiation by focusing on healthcare business that offers premium discounts to encourage healthy lifestyle habits.

Taiwan-based Fubon Hyundai Life also recorded a net profit of 95.1 billion KRW, up 15.8% from the previous year, achieving its highest performance. Fubon Hyundai successfully raised capital worth 600 billion KRW, including a paid-in capital increase by its largest shareholder, Taiwan's Fubon Life, in January.

[Image source=Yonhap News]

This content was produced with the assistance of AI translation services.