Tongyang Life Insurance's net profit fell after it was acquired by Woori Financial Group, leaving it behind ABL Life Insurance, which joined the group around the same time. As of the end of Sep. last year, ABL Life Insurance's total asset balance was 19.8289 trillion won, only 55% of Tongyang Life Insurance's 35.6945 trillion won, making it the "younger sibling" within the group. Tongyang Life Insurance plans to focus on improving soundness again this year rather than expanding sales.
According to the insurance industry on the 13th, Tongyang Life Insurance's net profit last year was 124.5 billion won, down 60.4% from 314.3 billion won a year earlier. Net profit from its core insurance business fell 58.5% year over year to 113.8 billion won, and investment profit decreased 9.2% to 85 billion won.
Tongyang Life Insurance's net profit shrank after it was brought under Woori Financial in Jul. last year. Net profit was 86.8 billion won in the first half of last year but dropped to 43.6 billion won in the second half, about half. ABL Life Insurance rose from 32.1 billion won to 56 billion won over the same period, surpassing Tongyang Life Insurance on a second-half basis last year.
Tongyang Life Insurance was also overtaken by Mirae Asset Life Insurance. Mirae Asset Life Insurance's net profit was 136.1 billion won in 2024, less than half of Tongyang Life Insurance's 314.3 billion won, but it reached 130.7 billion won last year, outpacing Tongyang Life Insurance's 124.5 billion won. Mirae Asset Life Insurance's total asset balance (33.2210 trillion won) is similar to Tongyang Life Insurance's.
Last year, rising loss ratios, including larger insurance payouts, hurt insurers' results. Tongyang Life Insurance's expected-versus-actual loss difference swung from a 17 billion won surplus in 2024 to a 72 billion won deficit last year. The expected-versus-actual loss difference refers to the gap between the insurance benefits an insurer projects it will pay in the future and the benefits actually paid.
Tongyang Life Insurance's investment profit also declined, in contrast to other insurers whose investment returns rose amid a bullish stock market. Shinhan Life's net profit last year was 507.7 billion won, down 3.9% year over year, while securities gains during the same period were tentatively tallied at 203.1 billion won, up 31.5%. Meritz Fire & Marine Insurance saw net profit fall 1.7% to 1.681 trillion won last year, but investment profit rose 13.2% to 862.3 billion won.
There is an outlook that Tongyang Life Insurance's net profit growth may also be limited this year as it plans to focus on strengthening soundness. Tongyang Life Insurance is selling risky asset and focusing on buying safe asset such as long-term bonds. The larger the volume of long-term bonds, the smaller the asset-liability fluctuations from interest rate changes.
The risk-based capital ratio, which assesses whether lump-sum insurance benefits can be paid, was 177.3% at the end of last year, up 21.8 percentage points from 155.5% a year earlier.