Korean Re Obtains Reinsurance Brokerage License for US Brokerage Corporation... Operations to Start Within the Year

Plans to Expand Operations from the Northeast to Across the United States

[Asia Economy Reporter Ki Ha-young] Korean Reinsurance has completed obtaining the reinsurance brokerage license for its US brokerage corporation and will start operations within the year.

Korean Re announced on the 29th that it received final approval for the reinsurance brokerage license of its US brokerage corporation from the New Jersey state regulatory authority on the 24th.

Earlier, in September last year, Korean Re announced plans to establish a reinsurance brokerage corporation locally to enter the US market. Although it already operates a liaison office in New York, it sought to overcome the limitations of the liaison office, which cannot conduct business activities, by entering in the form of a brokerage corporation. Like insurance sales corporations or branches, brokerage corporations can conduct face-to-face sales and generate commission income through reinsurance brokerage. Another advantage is that they can be established with relatively less capital compared to other forms.

The US insurance market is the largest in the world, accounting for about 40% of global insurance premiums. Although it is a challenging market to approach due to frequent lawsuits and the introduction of punitive damages liability systems, Korean Re believes it cannot ignore the scale of the US market.

Korean Re established a general corporation in New Jersey in February after searching for a suitable candidate location with the goal of starting operations in the second half of this year, and completed obtaining the reinsurance brokerage license on the 24th. Korean Re’s US brokerage corporation plans to commence operations within the year.

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

A Korean Re official said, "The acquisition of the reinsurance brokerage license for the US brokerage corporation is another achievement demonstrating Korean Re’s continuous and proactive overseas expansion will," adding, "We plan to start in the US Northeast and gradually expand our business scope throughout the United States."