One Year After Acquiring Prudential Life... KB Life and System Integration in Progress

Life One System Implementation Plan
New Changes in Individual Management System Over One Year

[Asia Economy Reporter Oh Hyung-gil] Prudential Life Insurance and KB Life Insurance have embarked on developing an integrated system. One year after joining the KB Financial Group family, new changes are emerging in their previously independent management structures.

Given that non-bank affiliates significantly influence the financial group's performance, merging the two life insurance companies is expected to enhance management efficiency and synergy.

According to the insurance industry on the 13th, Prudential Life Insurance will begin a 'business innovation' consulting project to jointly develop and build key systems with KB Life Insurance. This is a preliminary step to standardize the differing business processes of both companies and form a new corporate framework.

The two companies plan to create a system named the 'Life One System,' which will be applied not only to the IT sector but also to all insurance business services, including product development, insurance contracts, deposits and withdrawals, and insurance accounting. After selecting a consulting firm by the 23rd, the project will proceed for seven months, with the Life One System expected to be completed by the first half of next year at the latest.

Prudential Life Insurance, acquired by KB Financial Group last April for 2.3 trillion KRW, has maintained an independent management system from KB Life Insurance. Since its official incorporation as the 13th affiliate on August 31 last year, Prudential Life Insurance has been operated as an independent corporation under CEO Min Ki-sik, while KB Life Insurance has been led by CEO Heo Jeong-su.

The reason for maintaining separate management instead of integration lies in the distinctly different characteristics of the two companies. KB Life Insurance shows strengths in bancassurance and insurance agency (GA) channels, whereas Prudential Life Insurance specializes around its sales organization, Life Planners (LP), which boasts the industry's highest proportion of long-term employees.

There was a prevailing view that rushing integration could provoke organizational resistance. At the end of last year, Prudential Life Insurance faced conflict with the Field Council, composed of LPs, after attempting branch consolidations without gathering input from the sales field.

Therefore, an approach starting with the IT sector and gradually expanding integration areas is considered likely. Shinhan Life and Orange Life followed a similar method, completing a two-year integration process before launching Shinhan Life this past July.

KB Financial cannot help but be mindful of Shinhan's moves as it competes in the 'leading finance' race. Since its launch, Shinhan Life has established itself as the undisputed fourth-largest life insurer and is accelerating digital innovation and entry into healthcare sectors.

As of June, Prudential and KB Life recorded total assets of 23.58 trillion KRW and 10.93 trillion KRW, respectively. Should the integrated corporation be launched, it is expected to compete for a mid-tier ranking in the life insurance industry alongside Mirae Asset Life (41.71 trillion KRW) and Dongyang Life (36.31 trillion KRW).

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