With Corona, November Car Insurance Loss Ratio Soars... "Concerns Over Performance Deterioration"

Loss Ratios of Major 4 Non-Life Insurers' Auto Insurance
Preliminary Estimate at 85.5~87.4%
Break-Even Point Exceeds 80%

[Asia Economy Reporter Ki Ha-young] Since the phased return to normal life (With Corona) began last month, the increase in mobility has caused the loss ratio of automobile insurance to soar. Although there were high expectations for a surplus in automobile insurance this year, concerns are emerging that if the number of accidents rises and returns to pre-COVID-19 levels, performance could deteriorate again.

According to the non-life insurance industry on the 16th, the loss ratios of the top four companies?Samsung Fire & Marine Insurance, Hyundai Marine & Fire Insurance, DB Insurance, and KB Insurance?were tentatively recorded at 85.5% to 87.4% last month. In October, the loss ratios of these four companies, which hold about 85% market share, ranged from 79.5% to 84.0%.

Samsung Fire & Marine Insurance's loss ratio jumped 7 percentage points in one month, from 79.5% to 86.5%. Hyundai Marine & Fire Insurance also rose 5.1 percentage points, from 82.3% to 87.4%. DB Insurance and KB Insurance increased by 4.7 percentage points and 3 percentage points, reaching 85.5% and 87.0%, respectively, compared to the previous month.

Considering operating expenses, a loss ratio around 80% is known to correspond to the breakeven point.

This deterioration in the loss ratio is interpreted as being influenced by the increase in mobility due to With Corona. In fact, the average daily number of automobile accidents in November, when With Corona started, was 21,485 cases, an increase of 1,579 cases compared to 19,906 cases in October.

Additionally, from the 1st of this month, the average maintenance fee was raised by 4.5%, adding another factor worsening the loss ratio.

An industry official expressed concern, saying, "If the number of accidents continues to increase and returns to pre-COVID-19 levels, the performance of automobile insurance could deteriorate again."

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