Savings and whole life insurance, which had been suffering from sluggish sales, are trying to transform by adding cancer coverage and lump-sum utilization features. As demand fell due to low returns and the burden of long-term maintenance, insurers are reinforcing features that policyholders can use while alive to find a breakthrough.
According to the Korea Insurance Development Institute on the 30th, first premiums for monthly-payment savings-type policies at life insurers in the first half of this year were 40 billion won, down 44.6% from the same period last year. The first premium is the initial payment after a contract is signed and is an indicator of new sales volume. First-half first premiums for whole life policies also fell 5.7%, from 362.2 billion won last year to 341.7 billion won this year. Compared with 2024 (488.8 billion won), they decreased 30.1%.
Savings-type insurance is designed to prepare lump sums or retirement funds, with annuity insurance being representative. Because general annuity insurance prioritizes stability and is managed mainly in bonds, its expected rate of return is lower than that of annuity savings funds, and there is no tax credit at payment, limiting demand. Whole life insurance has also lost some of its past popularity as single-person and dual-income households increase, with more people prioritizing their own medical and living expenses over survivors' livelihood.
In response, insurers are rolling out products that combine health coverage such as cancer and dementia with lump-sum utilization features. Shinhan Life plans to launch "Shinhan Super SOL Life Switching Savings Insurance" on Nov. 2. After enrolling and paying into the policy, if coverage such as cancer or dementia becomes necessary, the accumulated reserves can be used to add related riders. Once underwriting is completed at initial enrollment, riders can be added later without additional underwriting.
Fubon Hyundai Life launched "MAX annuity-down annuity insurance" in June to enhance the use of retirement funds. After all premiums are paid, at the start of the annuity the policyholder can withdraw a lump sum within a set limit for children's education or medical expenses. The remaining funds pay a lifetime annuity.
Whole life insurance is also being changed to allow part of the death benefit to be used for medical or living expenses. Hanwha Life Insurance(088350) launched "Whole life to use when needed" on the 14th. In this product, the death benefit increases to as much as 210% of the enrolled amount depending on how long the contract is maintained, and after all premiums are paid, the policyholder can receive the full amount of paid premiums in a lump sum or in installments at a desired time. In that case, the death benefit decreases, but the remaining amount is maintained for life.
Samsung Life Insurance(032830) revised and relaunched "Golden Whole Life Insurance" on the 14th, which maintains death coverage at or above the initial enrollment amount even after funds are withdrawn. The policyholder can choose a type based on the purpose of fund use, and if selecting the cancer coverage type, upon a cancer diagnosis during the premium payment period, up to 20% of annual premiums can be withdrawn each year for 10 years, up to a total of 200%. After diagnosis, premium payments are waived.
An insurance industry official said, "In the past, the focus was on maintaining the coverage set at enrollment, but recently there has been a move to diversify product features so customers can use insurance more flexibly to match their needs."
