Samsung Fire & Marine Insurance reported on the 12th that its net profit last year was 2.736 trillion won, an increase of 14% compared to the previous year. This is the first time an non-life insurance company's annual net profit has surpassed 2 trillion won.
The cumulative insurance profit and loss from long-term insurance recorded 1.5776 trillion won, an increase of 2.5% year-on-year. The insurance contract margin (CSM) stood at 14.0739 trillion won at the end of last year, an increase of 771.1 billion won compared to the end of the previous year.
The annual insurance profit and loss from auto insurance recorded 95.8 billion won. Samsung Fire & Marine Insurance explained that despite reduced insurance rates and intensified competition, it maintained a profit margin based on the reduction of business costs and expanded competitiveness in online channels.
However, the cumulative insurance profit and loss from general insurance decreased by 13.9% year-on-year to 175.7 billion won. This is interpreted as being due to an increase in large accidental claims, which raised the loss rate.
Cumulative investment income increased by 19.7% year-on-year to 2.6193 trillion won. Thanks to continuous bond replacements and investments in high-yield assets, the investment yield rate rose by 0.42 percentage points to 3.22% during the same period.
Samsung Fire & Marine Insurance stated that it manages its solvency indicator, the capital adequacy ratio (KICS), at around 220% and aims to maintain a sustainable return on equity (ROE) of 11-13%.
Koo Young-min, head of the management support department at Samsung Fire & Marine Insurance, noted after the earnings announcement that Samsung Life Insurance is reviewing the possibility of incorporating Samsung Fire & Marine Insurance as a subsidiary, stating, "Even if it is incorporated as a subsidiary, it will operate its business as it currently does, in terms of operations and governance."
The possibility of incorporating Samsung Life Insurance as a subsidiary emerged after Samsung Fire & Marine Insurance announced that it would reduce its shareholding from the current 15.9% to less than 5% by 2028. If shares are canceled, Samsung Life Insurance's equity stake in Samsung Fire & Marine Insurance would increase from the current 14.98% to 16.93%. However, according to insurance industry law, an insurance company cannot hold more than 15% equity in another company, so Samsung Fire & Marine Insurance must either be incorporated as a subsidiary or sell the exceeding equity.