Analysis of Hanwha Life Insurance policyholders

20s-30s account for 31% of sign-ups — double the industry average

Products popular among single-person households and unmarried adults

Death benefit preserved even after full premium withdrawal

[Getty Images Bank]
[Getty Images Bank]

Whole life insurance, long seen as a product for bereaved families, is drawing growing interest from younger Koreans. A wave of new "lifetime fund" whole life policies — which allow policyholders to withdraw premiums while still alive — is reframing the product as coverage for oneself, not just one's heirs.

According to Hanwha Life Insurance, an analysis of policyholders who signed up for its "Hanwha Life Use-When-You-Need-It Whole Life Insurance," launched Oct. 14, found that younger customers made up a notably higher share of buyers than is typical for conventional whole life products.

Looking at the age breakdown of customers who enrolled from launch through Tuesday, those in their 20s and 30s accounted for 31 percent of sign-ups — nearly double the 16 percent seen for standard whole life policies. By contrast, customers in their 50s and 60s made up 45 percent of enrollees, well below the 63 percent recorded for conventional products.

Signing up young also means lower premiums. The average coverage amount for policyholders in their 20s was 13 million won ($9,690), with a monthly premium of about 150,000 won. For the same level of coverage, customers in their 60s paid an average of about 210,000 won per month.

Whole life insurance has traditionally skewed toward older customers with children, given its focus on death benefits. But as demand for death coverage softens amid rising rates of unmarried adults, single-person households and a low birth rate, insurers are diversifying their whole life offerings with products that maintain death benefits while expanding how policyholders can use them.

This product is designed with life-stage funding needs in mind. The death benefit grows over time after enrollment, calibrated to peak during the 40s-to-60s window when such coverage is typically most needed.

When a lump sum is needed — for retirement, a child's marriage or other major expenses — customers can use the "lifetime fund withdrawal conversion" feature. After completing all premium payments, they may withdraw 100 percent of the total premiums paid at any point within 20 years of the policy's start date.

Unlike partial withdrawals under conventional whole life policies, this product continues to accumulate reserves and maintains the remaining death benefit for life even after the full lifetime fund has been withdrawn. Because the accumulated reserve exceeds total premiums paid once full payment is complete, interest continues to accrue on the remaining balance even after the principal is fully withdrawn. The death benefit amount does decrease after a withdrawal, however.

"The industry has been rolling out whole life products that strengthen not only death benefits but also lifetime fund features," said Park Hwa-yong, head of Hanwha Life's product marketing team. "Since withdrawal conditions — including timing and amount limits — vary by product and company, it is important for customers to choose a product that fits their lifestyle."


won@heraldcorp.com