In May this year, major nonlife insurers continued to post losses in auto insurance. The deficit is expected to widen further from June, when the rainy season and heavy downpours are forecast in earnest.
According to the nonlife insurance industry on the 23rd, the cumulative auto insurance loss ratio for May this year at five major nonlife insurers—Samsung Fire & Marine Insurance, Meritz Fire & Marine Insurance, DB Insurance, Hyundai Marine & Fire Insurance, and KB Insurance—was 84.1%, up 1.3 percentage points (p) from a year earlier. By company, DB Insurance was highest at 84.9%, followed by KB Insurance at 84.8%, Samsung Fire & Marine Insurance at 84.7%, Hyundai Marine & Fire Insurance at 84.2%, and Meritz Fire & Marine Insurance at 81.7%.
Major nonlife insurers have consistently recorded loss ratios in the 80% range since last year. The auto insurance loss ratio is an indicator calculated by dividing total accident payouts by premiums, and around 80% is generally seen as the break-even point.
For May alone, the auto insurance loss ratio was 80.5%, up 0.7 percentage points from a year earlier. DB Insurance was highest at 82.3%, followed by Samsung Fire & Marine Insurance at 82.2%, KB Insurance at 79.8%, Meritz Fire & Marine Insurance at 79.2%, and Hyundai Marine & Fire Insurance at 78.9%.
Last month's auto insurance loss ratio improved slightly from a year earlier, which appears to reflect the impact of the auto insurance premium hikes implemented early this year. However, a combination of factors—four consecutive years of premium cuts, more accidents from natural disasters, overtreatment of minor injury patients, and higher repair tariffs—has kept auto insurance in the red.