Yi Whan-woo is a Korea Times journalist primarily covering finance. He writes in-depth articles on macroeconomy and financial markets and previously covered sports, politics, diplomacy and inter-Korean affairs, among others. Feel free to contact him at yistory@koreatimes.co.kr.
Life insurers turn to asset management for new revenue stream
The headquarters of Kyobo Life Insurance, one of South Korea’s five leading life insurers, in central Seoul. / Yonhap
By Yi Whan-woo
In response to declining profitability stemming from increased life expectancy and broader demographic shifts, life insurance companies are increasingly expanding into asset management as an alternative revenue stream, industry officials said on Thursday.
The officials said the strategic shift toward asset management has been accelerated by stricter financial reporting standards, particularly the adoption of International Financial Reporting Standard 17 (IFRS 17) in 2023.
Developed by the London-based IFRS Foundation, IFRS 17 places greater emphasis on the rigorous accounting and transparent reporting of asset management activities in the financial statements of insurance companies.
According to the Financial Supervisory Service (FSS), the net profit of 22 life insurers nationwide amounted to 3.33 trillion won ($2.4 billion) in the first half of 2025.
The amount was 311.6 billion won lower than the previous year, mainly due to a decline in underwriting profits — the core business function of assessing risks when providing coverage to policyholders.
On the other hand, the life insurers have been steadily increasing their investment returns on assets.
For instance, the average investment return rate on assets for the five largest market players — Samsung Life Insurance, Kyobo Life Insurance, Hanwha Life Insurance, NongHyup Life Insurance and Shinhan Life Insurance — was measured at 3.19 percent at the end of the second quarter of this year.
The rate increased from 3.12 percent during the same period in 2024.
This improvement is partly attributable to the five companies maintaining an asset management ratio that exceeds 90 percent, in line with IFRS 17, which requires more thorough investment-generated income and risk management.
Some companies have also taken steps to expand their asset management businesses through acquisitions.
Among them, Samsung Life is preparing to acquire a stake in Hayfin Capital Management, a European private equity firm with approximately 34 billion euros (55 trillion won) in assets under management.
Hanwha Life Insurance and Heungkuk Life Insurance are competing to acquire IGIS Asset Management, a Seoul-based company that is the largest real estate asset manager in Korea.