Growing Corporate Agencies... Insurers Expanding Subsidiaries as 'Daehangma' Competitors

Hanwha Life Insurance, Hanwha Life Lab Capital Increase
Targeting Top 10 Entry in GA Industry

Hana Insurance, Subsidiary Hana Financial Find
Insurtech Platform 'New Start'

[Asia Economy Reporter Oh Hyung-gil] Insurance companies are focusing on expanding their subsidiary-type corporate agencies (GA). While the previous approach was a ‘separation of production and sales (제판분리)’ to strengthen sales channel influence, recently they have been entering IT-based platform development through GAs, creating a new competitive landscape in the GA industry.

According to the insurance industry on the 24th, Hanwha Life completed a 21 billion KRW paid-in capital increase on the 16th through its subsidiary Hanwha Life Lab. This is the second capital expansion following a 20 billion KRW capital increase in 2018. Hanwha Life Lab is a corporation created last December by merging Hanwha Life Asset, established in 2005, with Hanwha Financial Asset, and adopted its new name in April.

Hanwha Life Lab conducts insurance sales through business partnerships with 11 life insurance companies and 9 non-life insurance companies, including Hanwha Life. Although it had only 1,610 affiliated planners as of the first half of the year, it plans to secure 5,000 planners by 2023 to enter the GA industry’s ‘Top 10’.

Hanwha Life Financial Service, established in April by separating the sales channel from Hanwha Life, is also evaluated to have successfully settled. With 18,765 affiliated planners, it quickly rose to first place in the GA industry. Its new contract amount in the first half of the year reached 42.2 billion KRW. Although it recorded a net loss of 29 billion KRW in the second quarter after separation, it aims to turn profitable in 2023 by increasing sales of non-life insurance products.

Hana Non-Life Insurance also recently announced a fresh start by changing the name of its subsidiary GA Hana Financial Partner, established in March, to ‘Hana Financial Find.’ It aims to become a financial platform based on ‘Insurtech’ (a combination of insurance and technology), moving away from a planner-centered GA.

They appointed Nam Sang-woo, former CEO of Rich Planet who succeeded with the insurtech platform ‘Goodrich’ after working at Lycos Korea and SK Communications, as the new CEO, and are promoting platform construction projects targeting next year. The platform will provide functions such as insurance analysis, insurance claim filing, and comparison quotes, and is expected to include a profile feature allowing insurance customers to directly view planners’ names, specialties, photos, and careers to entrust their planning.

CEO Nam stated, "We will further strengthen digital capabilities in the platform era represented by the metaverse (extended virtual world)," and expressed his ambition to "pursue a new insurance ecosystem where customers, consulting experts, and insurance companies are naturally connected."

In the GA industry, the growth of insurance company subsidiary GAs has recently been remarkable. Leading Hanwha Life Financial Service, Mirae Asset Financial Service (3,862 affiliated planners), Shinhan Financial Plus (3,241), Samsung Fire & Marine Financial Service (3,117), and Samsung Life Financial Service (1,860) are not significantly behind large GAs in scale.

As the influence of large GAs with sales networks grows, insurance companies are choosing a strategy to develop subsidiary GAs as rivals. Kim Dong-kyum, a research fellow at the Korea Insurance Research Institute, diagnosed, "Unlike exclusive planners of insurance companies, GAs handling various products have an obligation to explain product comparisons but may encourage contracts focused on high-commission products to consumers. It is not easy for insurance companies to suppress this."

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