In the U.S. market, once considered the No. 1 destination for Korean insurers' overseas expansion, companies are posting mixed results. While Samsung Fire & Marine Insurance and KB Insurance have scaled back or exited, DB Insurance and Hyundai Marine & Fire Insurance are expanding their foothold with localization strategies.
According to the Financial Supervisory Service on the 20th, as of the end of last year, the Korean insurers with branches or subsidiaries in the United States are DB Insurance, Hyundai Marine & Fire Insurance, Samsung Fire & Marine Insurance, and KB Insurance. They operate a total of 10 entities in the United States, including subsidiaries and branches. That is up by only one from 2018, when there were nine, effectively marking little progress.
Samsung Fire & Marine Insurance entered the U.S. market in 1990 by establishing a New Jersey branch. It subsequently expanded local insurance sales, but as losses piled up, it significantly downsized the business in 2017 by ceding insurance contracts to a reinsurer. It now continues operations mainly in corporate insurance for Samsung affiliates and Korean corporate clients through its New York and New Jersey entities. After the Korea-U.S. tariff agreement in July last year, corporate insurance sales increased on the back of greater U.S.-bound investment by Korean corporations.
KB Insurance has effectively wound down its U.S. business. It took its first step by opening a New York branch in 1990, but after a surge in loss ratios and other factors, its board decided in July 2022 to withdraw its U.S. subsidiary. It halted new sales in October that year and stopped renewals in December. The remaining policies were all transferred to a foreign reinsurer in September last year. The subsidiary is now only awaiting the license surrender process, and local operations have been fully terminated.
DB Insurance is taking active steps to tap the U.S. market. Starting with the Guam branch in 1984, it now operates four branches in Hawaii, California, and New York, and it has a Americas business headquarters in California. It has built a local sales base focused on commercial package insurance, homeowners fire insurance, and commercial auto insurance. Its U.S. direct premiums written surpassed 800 billion won last year.
DB Insurance last year acquired 100% equity in the U.S. specialty insurer Fortegra for about 2.3 trillion won. Fortegra has strengths in specialty insurance (non-fire, non-marine, non-auto lines within non-life) and surety insurance, and once the acquisition is completed, DB Insurance's overseas business share is expected to expand from the current 3–5% to 20–25%.
Hyundai Marine & Fire Insurance is also steadily expanding its U.S. business. Building on a U.S. branch set up in 1994, it strengthened corporate insurance for Korean corporations with New Jersey as its base, and in 2012 it entered the personal lines market by beginning sales of homeowners comprehensive insurance in New York state. It later expanded its operating areas to New Jersey, California, and Hawaii, and in 2022 it launched commercial auto insurance in California. Its U.S. direct premiums written came to about 288.7 billion won last year.
An insurance industry official said, "The U.S. market is large, but regulations and competition are intense, making it hard for Korean insurers to gain a foothold," adding, "DB Insurance and Hyundai Marine & Fire Insurance are cases of business expansion through, respectively, mergers and acquisitions and localization strategies."