Changes in Long-Term Insurance Rankings Driven by Meritz Fire & Marine Surge... Split Between Health and Accident Insurance Strategies

Initial Premium Ranking Rises from 5th to 3rd in First Half
Rival Companies Stick to Health Insurance Sales Strategy
"Underwriting Strengthened to Secure High-Profit Contracts"

Meritz Fire & Marine Insurance has raised its long-term insurance initial premium (revenue) ranking among non-life insurers from fifth to third place in the first half of the year, thanks to its aggressive accident insurance sales strategy. In comparison, companies such as Samsung Fire & Marine Insurance, DB Insurance, and KB Insurance, which continued to focus their sales strategies on health insurance, experienced a decline in their initial premium rankings.

Meritz Fire & Marine Insurance headquarters building in Gangnam-gu, Seoul. Meritz Fire & Marine Insurance

According to data aggregated on September 8 through the Insurance Statistics Query Service by the Korea Insurance Development Institute, the total initial premiums for long-term insurance from the top eight non-life insurers during the first half (January–June) of the year amounted to 451.8 billion won—a decrease of 10.9% compared to 507 billion won during the same period last year.

By company, Samsung Fire & Marine Insurance (92.9 billion won) and DB Insurance (83.4 billion won) maintained the top two spots. Meritz Fire & Marine Insurance (71.6 billion won) jumped two ranks from fifth to third. The ranking was followed by KB Insurance (63.3 billion won), Hyundai Marine & Fire Insurance (60.8 billion won), Hanwha General Insurance (47.9 billion won), Heungkuk Fire & Marine Insurance (22.1 billion won), and Lotte Insurance (9.7 billion won).

Industry experts believe the ranking for initial premiums in the first half of this year was determined by the difference between accident and health insurance sales strategies. While the total initial premiums for long-term insurance decreased by 10.9% compared to last year, initial premiums for accident insurance increased by 10.0%—from 155.3 billion won to 170.8 billion won.

Hanwha General Insurance (77.8%) and Meritz Fire & Marine Insurance (77.0%) had the highest proportions of accident insurance in their total long-term insurance initial premiums. Together, the two companies accounted for 54.1% of the total accident insurance initial premiums among the top eight companies.

The industry attributes the increase in Meritz Fire & Marine Insurance's accident insurance business in part to its recent significant expansion of its sales organization, including so-called "multi-job planners" (N-job planners) who work part-time. Accident insurance products provide coverage for abrupt and unforeseen external accidents, and they are often structured with riders for fracture, burns, casts, and so on. Compared to health insurance—which covers cancer, cerebrovascular, and heart diseases—accident insurance places a lower burden on policyholders in terms of disclosing their medical history, and underwriting standards are relatively simple.

Because of these characteristics, it is relatively easy for both newly hired planners with low sales proficiency and corporate insurance agency (GA) planners to sell accident insurance policies, according to the industry. The trend in the number of exclusive planners is an indirect indicator of how well companies are recruiting multi-job planners. As of the end of the first half, Meritz Fire & Marine Insurance led with 49,760 exclusive planners, ranking first, while Hanwha General Insurance ranked fourth with 15,430 exclusive planners.

An industry official explained, "Accident insurance is structurally simpler than health insurance and the coverage is relatively intuitive—focused on 'abrupt and unforeseen external accidents'—so planners with less experience can sell to customers with relative ease."

Non-life insurers that have implemented sales strategies focused on health insurance intend to continue prioritizing health insurance in their sales, despite the first-half decline in initial premiums. According to industry experts, health insurance tends to have longer contract durations and higher premiums compared to accident insurance, making it relatively advantageous for securing long-term profitability.

In this regard, DB Insurance announced on August 28 a "value-up" plan to raise its contractual service margin (CSM)—a profitability metric—and focus on increasing its customer contract renewal rate. The company cited its own analysis, which indicated that if the company were to pursue 20% growth in new contract volume over the current level to expand in terms of size, there would be an increase in replacement (contract switching) contracts, which could ultimately limit the net increase in CSM.

Not only DB Insurance but also many leading non-life insurers are focusing on securing competitiveness in the highly profitable health insurance sector, rather than prioritizing initial premium size for the first half of the year. This is considered an orthodox strategy.

An official from a major non-life insurer commented, "We recognize that the growth in protection-type insurance has slowed somewhat recently, and with reduced sales of low-profitability, very light and simplified insurance products, initial premiums have declined. However, we will continue with our management strategy centered on selling highly profitable products such as health insurance."

An official from another non-life insurer added, "Rather than focusing on initial premium rankings for the first half, our management strategy is to avoid excessive competition and concentrate on high-profit contracts. Major non-life insurers are also strengthening their underwriting standards and monitoring, and our company's management policies are in line with this approach."

This content was produced with the assistance of AI translation services.