Naver Pay, Kakao Pay, and Toss, collectively known as 'Nekato,' are targeting the insurance market with different strategies, drawing attention to their results next year. Naver Pay focuses on enhancing its main business, platform activation, while Kakao Pay is concentrating on developing products directly. Toss is emphasizing traditional sales practices through its insurance brokerage firm.
According to the insurance industry on the 24th, Toss Insurance, an insurance brokerage firm (GA) and a subsidiary of Viva Republica that operates Toss, is accelerating its recruitment of agents to expand its presence. As of this day, it has approximately 2,000 agents and has set a target of 3,000 for the first half of next year. The insurance industry assesses that the speed of agent recruitment at Toss Insurance outpaces that of other GAs.
Toss Insurance is leveraging customer accessibility as its core strength. Its strategy focuses on securing sophisticated customer databases (databases) based on Toss, which has nearly 20 million monthly active users (MAU). It emphasizes its unique offering of providing customer databases every month to attract agents.
Toss has effectively adopted traditional sales strategies in the insurance industry, which is reflected in its notable performance. Established in November 2018, Toss Insurance recorded a net profit of 350 million won in the first half of this year, marking its first turn to profitability.
Rather than directly engaging in sales, Naver Pay is leading the way in insurance comparison and recommendation services, focusing on its platform, which symbolizes Naver. The aim is for users to access Naver Pay and compare all insurance products with just a few clicks without any agents.
While the overall MAU of Naver Pay and Kakao Pay are similar, Naver Pay is reported to have a significantly higher user count specifically for its insurance comparison and recommendation services. Currently, it only compares and recommends five products, including auto insurance, but plans to expand the range of products.
However, overcoming resistance from the insurance industry is a significant challenge. Insurance companies perceive the commission paid to Naver Pay for providing its platform as 'a threat to their business.' Some large insurance firms are refusing to participate in services due to opposition to Naver Pay's commission rates.
Kakao Pay has focused on directly developing and selling products. In October 2022, it launched Kakao Pay Insurance, introducing lifestyle-oriented products and affordable mini-insurance, garnering attention. Its overseas travel insurance surpassed 2 million subscribers in just 1 year and 4 months since its launch.
Kakao Pay is concentrating on enhancing the user experience by utilizing popular applications like KakaoTalk to facilitate easy insurance sign-ups and claims. It believes that if individuals in their 20s and 30s experience the benefits of insurance, they are more likely to choose products from Kakao Insurance in the future.
While Kakao Insurance's deficit is widening, some newly established insurers have also faced losses, leading to an assessment that this is not a concerning issue. Kakao Pay believes that rather than focusing on immediate profitability, accumulating a loyal customer base is essential. In the third quarter of this year, Kakao Pay Insurance recorded a net loss of 13.1 billion won, with the size of the deficit increasing by more than 30% compared to the same period last year.