Despite COVID-19, Samsung Insurers 'Saved Face' in China Business (Comprehensive)

Samsung Life's Joint Venture in China
Operating Revenue 1.5 Trillion KRW
51% Growth Compared to Previous Year

[Asia Economy Reporter Oh Hyung-gil] Samsung Life Insurance continues to show improved performance in China and Thailand despite the impact of COVID-19. In line with its mid-to-long-term vision to achieve 30% of profits from overseas business segments, additional overseas investments are expected to become more visible.

Samsung Fire & Marine Insurance’s overseas subsidiaries are also delivering tangible results, demonstrating that Samsung’s insurance affiliates are holding their ground in the global market.

According to the insurance industry on the 31st, Samsung Life’s Chinese joint venture, Zhongyin Samsung Life Insurance Co., Ltd. (Zhongyin Samsung), achieved operating revenue of 1.5631 trillion KRW last year, a remarkable 51% increase from 1.0291 trillion KRW the previous year.

Net profit also rose by 31%, from 8.5 billion KRW in 2019 to 11.2 billion KRW last year.

Zhongyin Samsung, established as a joint venture between Samsung Life and Bank of China in 2005, currently has Bank of China holding a 51% stake, while Samsung Life and China Aviation hold 25% and 24%, respectively. Since turning profitable in 2017, it has maintained a profit-making trend for four consecutive years. Bancassurance sales (insurance sales through bank channels) via Bank of China have been a foundation for growth.

Alongside China, another key pillar of Samsung Life’s overseas strategy is its Thai subsidiary, Thai Samsung. Thai Samsung’s operating revenue grew 10% year-on-year to 189.9 billion KRW last year. Although net profit slightly decreased from 1.2 billion KRW to 900 million KRW, it has recorded consecutive profits from 2017 through last year.

Thai Samsung has been nurturing new agents through five development centers across Thailand, increasing the number of agents by 17% to 9,178 as of the end of last year compared to the same period the previous year. New agent channel annualized premium equivalent (APE) for new contracts rose 14% year-on-year to 47.3 billion KRW.

Samsung Life previously established a ‘2030 Mid-to-Long-Term Vision’ to expand the profit contribution from overseas insurance to 30%. Currently, domestic insurance accounts for 85% and overseas 15% of profit contribution, but the mid-to-long-term goal is to increase overseas share to 30%, with asset management at 32% and domestic insurance at 38%.

To this end, it is scouting for new investment targets. A Samsung Life official said, “We have selected emerging Asian countries as investment regions,” adding, “The investment targets and timing are still under review.”

Samsung Fire & Marine Insurance Holds Strong in China, Europe, Vietnam, and More

Samsung Fire & Marine Insurance also recorded strong performances from its overseas subsidiaries in China, Vietnam, Singapore, Europe, and others. Overseas business segment premium income was 229.1 billion KRW last year, slightly down about 3% from 235.9 billion KRW the previous year, but net profit during the same period increased 13% from 29.5 billion KRW to 33.3 billion KRW.

Samsung Fire operates seven subsidiaries in Europe, Vietnam, China, Singapore, Indonesia, the United States, and the United Arab Emirates (insurance agency). Among these, the Chinese subsidiary’s net profit rose 23% year-on-year to 12.3 billion KRW. The subsidiaries in Vietnam (7.9 billion KRW), Singapore (6.6 billion KRW), and Europe (5.3 billion KRW) also saw increased net profits compared to the previous year.

Last year, Samsung Fire established a cooperative system with Tencent, China’s largest IT company, through a third-party allotment capital increase in its Chinese subsidiary.

Additionally, Samsung Fire has been involved in management by investing 150 million USD in the UK’s Lloyd’s Canopius since 2019. In October last year, it participated in a capital increase, investing an additional 110 million USD (approximately 130 billion KRW). The plan is to expand sales footholds in the United States, the world’s largest property and casualty insurance market, in cooperation with Canopius.

A Samsung Fire official said, “We are in the process of obtaining approval from Chinese financial authorities to convert the Chinese subsidiary into a joint venture,” adding, “We plan to grow the Chinese subsidiary into an online insurance business centered on Tencent’s strong IT technology.”

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