Rapid Growth of 'General Liability Insurance' for Kickboards and Mobile Phones... "Need to Explore New Areas"

KIRI, Report on 'Recent Growth Factors and Implications of General Non-Life Insurance'

[Asia Economy Reporter Ki Ha-young] Despite the economic downturn caused by COVID-19, the general non-life insurance market continues to show growth. This is due to the expansion of general non-life insurance risk coverage into areas less sensitive to economic fluctuations. As there is a high possibility of entering a new growth phase in the future, it is advised to focus on discovering new areas and strengthening underwriting capabilities.

According to the report "Recent Growth Factors and Implications of General Non-Life Insurance" recently published by the Korea Insurance Research Institute on the 18th, the growth rate of general non-life insurance last year was 8.3%, higher than the overall non-life insurance growth rate of 7.0%. In the first quarter of this year, general non-life insurance also grew by 8.5% compared to the same period last year, maintaining a high growth rate that surpassed the growth rates of long-term non-life insurance and automobile insurance premiums (5.3% and 6.3%, respectively).

General non-life insurance is divided into detailed categories such as fire insurance, marine insurance, guarantee insurance, and special insurance, most of which are commercial insurance with characteristics sensitive to economic conditions. The report stated, "The growth rate of general non-life insurance lags nominal GDP growth by about one year and moves in a similar trend, but recently, despite the slowdown in the real economy, the general non-life insurance market is experiencing high growth," adding, "This phenomenon appears as general non-life insurance risk coverage expands into areas less sensitive to the economy due to the growth of new business sectors with low correlation to traditional manufacturing and construction industries, and social perception changes such as strengthened liability coverage."

New risk coverage areas such as satellite insurance, liability insurance, and mobile phone guarantee insurance are emerging in the general non-life insurance market. Related mandatory insurance is also expanding due to the advent of new mobility industries like kickboards and drones, as well as the increase in companion animals.

The report diagnosed, "General non-life insurance has the potential to enter a new growth phase along with fundamental environmental changes such as the increase in new coverage areas due to industrial structural changes represented by the 4th Industrial Revolution and the expansion of mandatory liability insurance due to the emergence of new risks," adding, "Especially after the spread of COVID-19 last year, economic and social environmental changes have accelerated, and niche markets are expected to emerge." It further stated, "Considering the positive changes surrounding general non-life insurance, the non-life insurance industry should actively discover new areas and strengthen underwriting capabilities."

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