Samsung Life going global

By Kang Seung-woo

Samsung Life Insurance will aggressively make a foray into overseas markets and its first target is China, its president said Wednesday.

“Samsung Life is a runaway leader in the Korean life insurance market, but we cannot be laidback, just enjoying the title,” newly-appointed President Park Keun-hee said in his visit to Samsung Air-China Life Insurance in Beijing. Samsung Life and Air China Group established the 50-50 joint venture in 2005.

“Our business will focus on expanding our territory abroad.”

It came after the insurance company went through a restructuring which expanded the Overseas Business team into the Overseas Business Headquarters.

The industry believes that the Park appointment signals that Samsung Life is aiming at expanding its footing in overseas markets, especially in China.

Along with the promotion of the Overseas Business Headquarters, Park named Shim Jae-ho, former executive director of Samsung Air-China Life Insurance, to lead the headquarters.

“It might seem that Samsung Life has played a leading role in the Korean financial industry. However, compared with other Samsung affiliates, we have neglected the global markets,” an official of Samsung Life told The Korea Times.

“There is a limitation to the growth of the local market, so we need to find a new growth engine in the overseas market to raise ability. The globalization is his business decision.”

Park, 57, who is familiar with China after serving as the Samsung China president, said that the company will make a full-scale effort to strengthen its presence in China.

“Since 2005, Samsung Air-China Life Insurance has displayed a solid performance, but it is not enough. I plan to come to Beijing again soon to talk with high-ranking officials of Air China Group,” he said.

The joint venture’s profit from insurance premium managed to stand at 6.8 billion won in 2007, but it took a sharp rise to 54.5 billion won as of November.

After its initial public offering (IPO) in May, its CEO Lee Soo-chang said that he would direct the life insurer toward qualitative development and globalization due to unfavorable conditions to its steady growth — market saturation, decline of population and low interest rate ― in the Korean market.

Although Samsung Life is trying to penetrate the Chinese market, it is still tough for foreign insurance companies to make inroads into it.

Due to a tight regulation which allows a joint-venture company to operate, the market share of non-Chinese insurers accounts for a mere 3 percent.

But the president has set his sight on China’s potential.

“As (I expect) foreign insurers’ market share is likely to increase steadily and its per capita income is expected to reach $10,000 and $20,000, the Chinese insurance market will grow hugely. So, the market is a must-have one,” Park said.

Along with Samsung Air-China Life Insurance, Samsung Life has one affiliated company in Thailand, Siam Samsung Life Insurance, while it also runs two subsidiaries working on investment in London and New York.