Life insurers' net profit up 17.7% as investment gains surge 51.6%

Non-life insurers see improvement in both insurance and investment income

Premium income reaches 135 trillion won; ROE slips to 8.52%

South Korean insurers posted combined net profit of more than 9 trillion won in the first half of this year. Life insurers saw a decline in insurance income but a sharp rise in investment gains, while non-life insurers improved on both fronts. Image created using Gemini.
South Korean insurers posted combined net profit of more than 9 trillion won in the first half of this year. Life insurers saw a decline in insurance income but a sharp rise in investment gains, while non-life insurers improved on both fronts. Image created using Gemini.

South Korean insurers posted combined net profit of more than 9 trillion won ($6.51 billion) in the first half of this year. Life insurers recorded lower insurance income but saw a sharp rise in investment gains, while non-life insurers improved on both fronts.

The Financial Supervisory Service released its first-half 2026 insurance industry earnings report Thursday, showing the combined net profit of 22 life insurers and 30 non-life insurers reached 9.01 trillion won, up 1.04 trillion won, or 13.0 percent, from the same period a year earlier.

Life insurers posted net profit of 3.93 trillion won, a gain of 589.2 billion won, or 17.7 percent, year on year. Investment income — driven by interest and dividend earnings as well as gains from the disposal and valuation of financial assets — rose 51.6 percent to 2.68 trillion won from 1.77 trillion won.

Insurance income at life insurers, however, fell 26.2 percent to 1.93 trillion won from 2.61 trillion won. The FSS said higher loss-burden costs and an increase in experience variance losses weighed on insurance income. Non-operating income swung to a profit of 401.6 billion won from a loss of 157.2 billion won in the first half of last year.

Non-life insurers posted first-half net profit of 5.09 trillion won, up 447.4 billion won, or 9.6 percent, from a year earlier. Insurance income rose 14.0 percent to 4.33 trillion won from 3.8 trillion won, while investment income climbed 10.2 percent to 2.76 trillion won from 2.5 trillion won. The FSS attributed the improvement in insurance income to the reversal of loss contract provisions and higher earnings from general insurance.

The scale of insurance business also expanded. Total premium income for the first half reached 134.93 trillion won, up 10.55 trillion won, or 8.5 percent, from the same period a year ago.

Financial Supervisory Service [Yonhap]
Financial Supervisory Service [Yonhap]

Life insurers' premium income rose 8.4 percent to 65.2 trillion won. Protection-type insurance grew 10.8 percent, variable insurance 3.9 percent and retirement pension products 18.4 percent, while savings insurance slipped 1.3 percent.

Non-life insurers' premium income increased 8.6 percent to 69.73 trillion won. Long-term insurance rose 5.8 percent, auto insurance 4.3 percent and general insurance 8.2 percent, while retirement pension products surged 24.1 percent.

Profitability indicators were mixed. The industry's return on assets for the first half came in at 1.28 percent, up 0.04 percentage points from the same period a year earlier. Return on equity, however, fell 2.75 percentage points to 8.52 percent from 11.27 percent over the same period.

Total assets held by insurers stood at 1,467.9 trillion won at the end of June, up 123.8 trillion won, or 9.2 percent, from the end of last year. Total liabilities rose 3.2 percent to 1,213.3 trillion won, while total equity grew 51.1 percent by 86.1 trillion won to 254.6 trillion won. Life insurers' total equity grew 63.3 percent and non-life insurers' 32.3 percent.

The FSS said the increase in first-half net profit was driven largely by a significant improvement in investment income compared with the same period a year earlier. It added that total equity grew on the back of a decline in insurance liabilities and a rise in equity valuations.

The regulator also warned that ongoing market volatility in interest rates, exchange rates and share prices — fueled in part by the prolonged situation in the Middle East — made it necessary to strengthen earnings and financial soundness management. It said it plans to closely monitor insurers' net profit and financial health and respond proactively to potential risks.


rim@heraldcorp.com