Korean Re establishes subsidiary in Switzerland

By Kim Bo-eun

Korean Re CEO Won Jong-gyu

Korean Reinsurance Company (Korean Re) has established its third overseas subsidiary in Switzerland, the company said, Monday.

Korean Re Switzerland AG will start a reinsurance business in property and casualty insurance from June, after receiving a license from the country's financial authorities last week.

The subsidiary in Zurich was established one year and six months after Korean Re began pushing forward with the plan in late 2017.

The reinsurer is turning to overseas markets as it faces declining profits here.

Korean Re's earnings peaked in 2015, but have been falling due to the country's saturated insurance market.

CEO Won Jong-gyu has emphasized overseas expansion since he assumed his position in 2013.

The company has set a goal to make 16 trillion won in overseas sales, up from the 1.8 trillion won it made last year.

“We established the subsidiary in Switzerland as a strategic point to enter European markets,” a Korean Re official said

Korean Re established its first overseas subsidiary in Hong Kong in 1995, and its second at Lloyd's, an insurance and reinsurance market in London, in 2015.

The company has three branches each in Singapore, Dubai and Malaysia and four offices each in New York, London, Tokyo and Beijing.

The insurer is looking into expanding into the South American market.

Its plan is to bring up the percentage of sales from overseas markets to 50 percent, from the current 24.6 percent.

Another factor is local financial authorities encouraging other Korean non-life insurers to expand their businesses into reinsurance, to have more players in the market other than Korean Re, which has a de facto monopoly position.

Korean Re is the world's 10th-largest reinsurance company in terms of gross written premiums.