Korean Re to Establish Reinsurance Brokerage Corporation in the United States

Proposed Establishment Sites in New York and the Northeastern United States
Targeting Business Launch in September 2021

[Asia Economy Reporter Ki Ha-young] Korean Reinsurance is planning to establish a brokerage corporation in the United States with the goal of starting operations in September next year.

Korean Reinsurance announced on the 25th that it plans to establish a reinsurance brokerage corporation locally in the U.S. to increase its underwriting in the American market. The candidate location for the brokerage corporation is the northeastern U.S., including New York, and it plans to start operations centered in this region before expanding nationwide. The U.S. is the world's largest insurance market, accounting for about 40% of global insurance premiums.

Korean Re's establishment of a U.S. brokerage corporation aims to commence operations in September next year. The company expects that with this brokerage corporation, the scale of reinsurance premiums underwritten in the U.S. market will increase from the current level of $220 million to over $300 million by 2025.

A brokerage corporation, like an insurance sales corporation or branch, can conduct face-to-face sales but can be established with relatively less capital. In addition to providing reinsurance volumes to Korean Re, it is also expected to generate commission income through brokering deals from other reinsurers. Korean Re already operates a representative office in New York, but since representative offices cannot conduct sales activities, this brokerage corporation establishment is expected to overcome that limitation.

Since the inauguration of President Won Jong-gyu in June 2013, Korean Re has accelerated its overseas market expansion by consecutively establishing six overseas bases including a local Lloyd's corporation in the UK, a Labuan branch in Malaysia, a Dubai branch, a local corporation in Switzerland, a Shanghai branch in China, and a Bogot? representative office in Colombia.

A Korean Re official said, "The U.S. brokerage corporation aims to establish detailed plans this year, apply for establishment approval from supervisory authorities in the first half of next year, and start operations in September 2021. Although the schedule may be delayed due to the COVID-19 situation, entering the U.S. market is a task that can no longer be postponed."