• 1-800-526-8630U.S. (TOLL FREE)
  • 1-917-300-0470EAST COAST U.S.
  • +353-1-416-8900REST OF WORLD
Bancassurance in South Korea: Life, Non-Life and Creditor Insurance Product Image

Bancassurance in South Korea: Life, Non-Life and Creditor Insurance

  • ID: 2258625
  • September 2012
  • Region: South Korea
  • 60 Pages
  • Finaccord

Bancassurance in South Korea: Life, Non-Life and Creditor Insurance is a study and related PartnerBASE™ dataset examining the provision of life, non-life and creditor insurance by banks and other lending institutions in South Korea.

Drawing on the results of a survey of 57 banking entities in South Korea, the study verifies the percentage of organisations investigated that distribute each of the following 13 types of insurance: accident insurance, creditor insurance related to consumer finance, creditor insurance related to credit cards, creditor insurance related to mortgages, critical illness insurance, health / hospital cash plans, household insurance, income protection insurance, investment-related life insurance, medical expenses insurance, personal motor insurance, retirement savings, and risk life insurance.

For those banking entities that are active in one or more of these fields, the reports ascertain the operating models that they use to source the type of insurance in question (e.g. external, joint venture or captive underwriters) and the identity of the specific providers used. This information is then displayed in terms of the weighted share of partnerships READ MORE >

0.0 EXECUTIVE SUMMARY

1.0 INTRODUCTION

What is this report about?

Distribution partnerships with banks and other lending institutions constitute the focus of this report

Rationale

Bancassurance is one of the most important distribution channels in South Korea

Methodology

Survey of banks and other lending institutions

Market data

Definitions

Investment-related life insurance

Retirement savings

Risk life insurance

Critical illness insurance

Income protection insurance

Accident insurance

Health / hospital cash plans

Medical expenses insurance

Personal motor insurance

Household insurance

Creditor insurance

Mortgages, consumer finance and credit cards

Weighted provider share of partnerships

Operating models

Abbreviations and exchange rates

PartnerBASE™ and market data annexe

Finaccord

2.0 MARKET BACKGROUND

Banks and other lending institutions covered

Economic background

South Korea benefits from an export-driven economic strategy…

…and has demonstrated a high level of financial resilience in recent years

In the World Bank's Ease of Doing Business Index, South Korea is ranked eighth in the world

Introduction to the banking sector

In terms of number of retail customers Kookmin Bank leads the market…

…which is highly concentrated with four predominant financial groups

The penetration of foreign banks is relatively low

Co-operative banks in South Korea have a fairly large customer base…

…and insurance companies are also engaged in consumer lending

Many of South Korea's savings banks have been wound up or taken over

Introduction to bancassurance

Bancassurance in South Korea is well-developed, in particular for life insurance products…

…and the market features a number of providers that specialise in bancassurance

The distribution of insurance products by banks is heavily regulated…

...aiming to prevent excessively strong ties between banks and insurance providers…

… meaning that captive and joint venture underwriters are therefore less prominent in the market

3.0 INVESTMENT-RELATED LIFE INSURANCE AND RETIREMENT SAVINGS

Insurance market size and growth

The market for retirement savings experienced rapid growth between 2008 and 2012

Investment-related life insurance encompasses a wide range of products

Non-life insurers also offer a range of long-term insurance policies

The introduction of policies combining both protection and savings elements has been a success

Distribution share of banks

Banks and other lenders are by far the most important distribution channel for these types of policy

Bancassurance provision rates, operating models and partnerships

Investment-related life insurance

A wide range of investment-related life insurance products is sold through banks

Heungkuk Life is the leading provider by weighted share of partnerships

MetLife has partnerships in place with six banking organisations

A number of captive underwriters are active in this market

25 banking organisations do not distribute investment-related life insurance

Retirement savings

50% of the banks surveyed in South Korea offer retirement products…

...and the leading two providers are identical to those for investment-related life insurance

Performance of key bancassurance underwriters

The importance of the bancassurance channel has grown significantly for major insurance companies…

… and dedicated bancassurance underwriters have expanded their market share since 2007

4.0 PROTECTION-RELATED LIFE INSURANCE

Insurance market size and growth

Protection-related life insurance decreased in value between 2008 and 2012

Critical illness cover is often bundled with medical expenses insurance products

Distribution share of banks

Banks play a significant role in the distribution of protection-related life insurance

Bancassurance provision rates, operating models and partnerships

Risk life insurance

Around one third of South Korea's banking institutions promote some form of risk life insurance

Aviva and Woori Financial formed a joint venture underwriter in 2008…

…and ING plans to sell its South Korean business in 2012

Critical illness insurance

Over 40% of banking institutions surveyed are distributors of critical illness insurance

AIA Life has partnerships in place with nine banking organisations

Income protection insurance

Performance of key bancassurance underwriters

5.0 ACCIDENT AND HEALTH INSURANCE

Insurance market size and growth

The market for accident and health insurance has grown rapidly in recent years

…and life insurers are active in this segment as well as non-life underwriters

Accident insurance is usually configured as a fairly standardised product

Distribution share of banks

Bancassurance provision rates, operating models and partnerships

Accident insurance

Around half of the banking organisations investigated in South Korea offer accident insurance...

... with Samsung Fire & Marine leading the market in terms of weighted partnership share

24 banking organisations have no apparent scheme in place for accident insurance

Medical expenses insurance

The provision rate is identical to that for accident insurance...

…with Hyundai Fire & Marine dominating the market for medical expenses insurance

Health / hospital cash plans

Health or hospital cash plans are not commonly offered through banking organisations

Performance of key bancassurance underwriters

Captive and joint venture underwriters play a minor role in the non-life insurance market

6.0 PERSONAL MOTOR AND HOUSEHOLD INSURANCE

Insurance market size and growth

Personal motor insurance declined in real terms between 2008 and 2012

Third party motor liability insurance is mandatory in South Korea…

…and household insurance often includes a savings function

Distribution share of banks

Bancassurance provision rates, operating models and partnerships

Personal motor insurance

Only around one quarter of the banking organisations researched offer personal motor insurance...

...with Meritz Fire & Marine ranked first among providers by weighted share of partnerships

Lotte Insurance is one of two providers used as captives in this market

Household insurance

The provision rate for household insurance is higher than that for personal motor insurance...

...and ING is the market leader in terms of weighted share of partnerships

Chartis has a sole partnership in place with Samsung Card

Performance of key bancassurance underwriters

7.0 CREDITOR INSURANCE

Consumer lending market size and growth

Mortgage lending

South Korea's residential mortgage balances grew at an annual rate of 7.7% between 2008 and 2012

Non-mortgage lending

The compound annual growth rate for non-mortgage balances is slightly higher than that for mortgages

Credit and other pay later cards

Specialised issuers dominate the market for credit cards in South Korea

In 2012, the Financial Supervisory Service tightened regulations for issuing credit cards...

... probably having learned from previous over-heating in this market

Creditor insurance provision rates, operating models and partnerships

Creditor insurance linked to mortgages

Several factors mean that banks do not distribute mortgage-related creditor insurance…

... including South Korea’s strict bancassurance regulations

Creditor insurance linked to consumer finance

Loan payment protection insurance is offered by few lending organisations in South Korea

Creditor insurance linked to credit cards

Schemes for credit card payment protection insurance are comparatively common in South Korea

Distribution partnerships are set up by credit card companies rather than by banks

Hyundai Fire & Marine benefits from its close relationship with BC Card

Creditor insurance risk coverage

All credit card payment protection policies incorporate comprehensive coverage

Creditor insurance market size, growth and forecast

Credit card payment protection insurance is a substantial sector in South Korea…

…making the country one of the largest markets in the world for this form of insurance

Stricter regulations concerning issuance of credit cards will slow growth in premiums for creditor insurance

LIST OF GRAPHICS / TABLES

0.0 EXECUTIVE SUMMARY

Overview of bancassurance provision rates for different types of insurance in South Korea, 2012

1.0 INTRODUCTION

Banks and other lending institutions in South Korea contacted by Finaccord, segmented by type

2.0 MARKET BACKGROUND

Key economic indicators for South Korea, 2012

3.0 INVESTMENT-RELATED LIFE INSURANCE AND RETIREMENT SAVINGS

Gross written premiums for investment-related life insurance and retirement savings in South Korea, 2008 to 2012

Gross written premiums for investment-related life insurance and retirement savings in South Korea, 2008 to 2012 (data)

Bancassurance provision of investment-related life insurance in South Korea, 2012: provision rate, operating models and weighted provider share of partnerships

Bancassurance provision of retirement savings in South Korea, 2012: provision rate, operating models and weighted provider share of partnerships

Share of new life insurance premiums attributable to the bancassurance channel of key underwriters in South Korea, 2007 to 2011

Market share in total life insurance of key bancassurance underwriters in South Korea, 2007 to 2011

4.0 PROTECTION-RELATED LIFE INSURANCE

Gross written premiums for protection-related life insurance in South Korea, 2008 to 2012

Gross written premiums for protection-related life insurance in South Korea, 2008 to 2012 (data)

Bancassurance provision of risk life insurance in South Korea, 2012: provision rate, operating models and weighted provider share of partnerships

Bancassurance provision of critical illness insurance in South Korea, 2012: provision rate, operating models and weighted provider share of partnerships

5.0 ACCIDENT AND HEALTH INSURANCE

Gross written premiums for accident and health insurance in South Korea, 2008 to 2012

Gross written premiums for accident and health insurance in South Korea, 2008 to 2012 (data)

Bancassurance provision of accident insurance in South Korea, 2012: provision rate, operating models and weighted provider share of partnerships

Bancassurance provision of medical expenses insurance in South Korea, 2012: provision rate, operating models and weighted provider share of partnerships

Bancassurance provision of health / hospital cash plans in South Korea, 2012: provision rate, operating models and weighted provider share of partnerships

Share of non-life insurance premiums attributable to the bancassurance channel of key underwriters in South Korea, 2007 to 2011

6.0 PERSONAL MOTOR AND HOUSEHOLD INSURANCE

Gross written premiums for personal motor and household insurance in South Korea, 2007 to 2011

Gross written premiums for personal motor and household insurance in South Korea, 2007 to 2011 (data)

Bancassurance provision of personal motor insurance in South Korea, 2012: provision rate, operating models and weighted provider share of partnerships

Bancassurance provision of household insurance in South Korea, 2012: provision rate, operating models and weighted provider share of partnerships

7.0 CREDITOR INSURANCE

Residential mortgage lending balances outstanding in South Korea (absolute and per capita), 2008 to 2012

Consumer non-mortgage lending balances outstanding in South Korea (absolute and per capita), 2008 to 2012

Credit and other pay later cards issued and per capita in South Korea, 2008 to 2012

Key data points for the consumer lending market in South Korea, 2008 to 2012

Provision of creditor insurance linked to consumer finance in South Korea, 2012: provision rate, operating models and weighted provider share of partnerships

Provision of creditor insurance linked to credit cards in South Korea, 2012: provision rate, operating models and weighted provider share of partnerships

Risk coverage of creditor insurance policies in South Korea, segmented by type of underlying product, 2012

Creditor insurance gross written premiums in South Korea, segmented by policy type, 2008, 2012 and 2016

Creditor insurance gross written premiums in South Korea, segmented by cover type, 2008, 2012 and 2016

Creditor insurance gross written premiums in South Korea, segmented by policy and cover type, 2008, 2012 and 2016 (data)

Note: Product cover images may vary from those shown

RELATED PRODUCTS

Our Clients

Our clients' logos