Korea Life going global

Date: 2011-03-28 11:45:09

Korea Life Insurance, the country’s oldest insurance company, has been a trailblazer for the local industry. Now it looks set to raise the bar further by strengthening its presence in international markets.

Korea Life has maintained its presence among the industry heavyweights since its establishment in 1946 and became the first insurance company to be listed on the stock market in March last year.

The company is now determined to prove that its history and size haven’t affected its agility as it spearheads a slew of Korean insurance companies looking to penetrate into global markets.

Going global is a must for Korean insurance firms, who fear that their growth momentum could be decimated by Korea’s alarmingly low birthrate and rapidly aging society.

“The local insurance market is becoming saturated, so advancement overseas is a must,” CEO and Vice Chairman Shin Eun-chul said.

Korea Life Insurance advanced into the Vietnamese market in April 2009 as the first Korean life insurer to do so and has made notable achievements thus far.

It took 1.8 percent of the market in terms of new sales, only one year after starting operations. The number of new sales totaled 10,000 and the first year insurance premium income reached $3.3 million, up 67 percent from the previous year.

Shin Eun-chul Korea Life CEO

The firm started business in the Southeast Asian country with 450 financial planners (FP) in three operations ― two in Ho Chi Minh City and one in Hanoi. The figure currently hovers over 3,600 FPs in 10 branches including Dak Lak, Khanh Hoa and Dong Nai.

However, Korea Life is not sitting back. It has set its eyes on scaling up its business network there by increasing the number of planners and branches to 9,000 and 22 respectively, by 2013 in its efforts to garner a 7 percent market share in terms of new sales.

“The insurance industry in Vietnam is growing at an annual average of 10 percent. And 60 percent of the population is under 30, so the potential for growth is very large,” a company official said.

“Just as we have led the life insurance industry in Korea for the past 65 years, we will continue to write the history of the ‘Great Challenge’ in Vietnam by offering the best products and customer services and helping the local insurance industry grow.”

The next destination for Korea Life is China.

It plans to establish a joint venture with Zhejiang International Business Group this year to gain ground in Zhejiang Province, which is one of the high-income areas in China with an annual income per capita of more than $6,000.

In December 2009, both sides reached a memorandum of understanding (MOU) to invest some 45 billion won by each to form a 50-50 joint venture.

To be headquartered in the historical lake city of Hangzhou near Shanghai, the Chinese venture has submitted its application for preliminary approval.

Thanks to its soft landing in the Vietnamese and Chinese markets, Korea Life is considering tapping into other emerging markets in Southeast Asia.

Kang Seung-woo - ksw@koreatimes.co.kr (http://www.koreatimes.co.kr/)