Insurers Lead in Retirement Pension Competition... Standing Out Amid Money Move

Kyobo and Samsung Strengthen 'Managed Pension' Strategies, Achieve Top Yields
Shinhan Bank Takes No. 1 Spot in Total Accumulated Funds, Surpassing 54 Trillion Won
"Insurers Must Differentiate by Combining Unique Risk Protection with Performance-Base

Insurance companies are taking the lead in the retirement pension yield competition. Major insurers such as Kyobo Life and Samsung Life are maintaining their top-tier performance by focusing on asset allocation centered on exchange-traded funds (ETFs) and leveraging digital management strategies.

According to the Financial Supervisory Service’s retirement pension provider comparison disclosure on May 6, as of the first quarter of this year, Kyobo Life posted a one-year return of 26.15% for defined contribution (DC) retirement pension principal non-guaranteed products, the highest among the top 15 providers by pension reserves.

Kyobo Life stood out not only in short-term results but also in mid- to long-term returns. Over the past seven years, the company achieved an average annual return of 7.52% for DC plans and 6.95% for individual retirement pensions (IRPs), ranking among the top performers. Even over a ten-year period, Kyobo Life maintained returns in the 5% range, demonstrating its long-term management capability.

Such performance is interpreted as the result of more than just market gains; it is attributed to an asset allocation strategy centered on ETFs combined with a digital-based management system. Kyobo Life offers a lineup of over 700 ETFs and systems such as ‘ETF deposit product selection’ and ‘automatic product switching’ to allow customers to regularly diversify their investments. In addition, by integrating robo-advisors to assist with market analysis and portfolio construction, the company has further enhanced its digital capabilities. Kyobo Life also combines external expert evaluations with internal research and big data analysis to select outstanding funds and provide tailored consulting services.

Competitor Samsung Life has also maintained a top-tier position in the yield competition, recording a 25.17% return for DC principal non-guaranteed accounts and returns in the 23% range for IRPs. Notably, at the beginning of this year, Samsung Life established dedicated DC and IRP teams to strengthen its competitiveness. The company is reinforcing its ‘managed pension’ strategy by providing portfolio consultations tailored to each subscriber’s investment profile and offering intensive monitoring services for accounts with lower returns.

However, in terms of total pension reserves rather than yield, Shinhan Bank reached the 54 trillion won range in the first quarter of this year, overtaking Samsung Life to become number one in the retirement pension market, demonstrating that banks maintain an advantage in the competition for scale.

The competitive landscape with securities firms is also pronounced. Amid the recent stock market boom, a ‘money move’ phenomenon has emerged, with DC and IRP funds shifting to securities firms that offer direct ETF trading and lower fee structures, thereby eroding the market share of insurers and banks.

Amid this competitive environment, attention is focused on how insurers are responding to capture both profitability and stability. Cho Younghyun, a research fellow at the Korea Insurance Research Institute, noted, “Insurers need to enhance the competitiveness of their pension products to respond to the structural shift toward a higher proportion of household risk assets,” and added, “Insurer differentiation should come from combining insurance’s unique risk protection functions with performance-based management.”

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