[Insurance Planner Mass Migration]② GA's Record-Breaking Performance... 'Separation of Production and Sales' Also Worked

Hanwha Life Financial Service's First Profit After 2021 Separation
Top 5 GAs Achieve Record High Performance
Properly Responding to Changes in Consumer Demand
GAs Actively Invest in Agent Training and IT Infrastructure

Last year, not only insurance companies but also corporate insurance agencies (GA) achieved record-breaking performances. Both independent GAs and subsidiary-type GAs aggressively invested in by large insurance companies succeeded in turning a profit, resulting in a successful case of 'separation of manufacturing and sales' (product manufacturing and sales separation).

Hanwha Life Insurance Building [Image source=Hanwha Life Financial Services Introduction Video]

Hanwha Life Financial Services (HanGeumSeo), a subsidiary-type GA of Hanwha Life, posted a net profit of 68.9 billion KRW last year. This is the first profit since Hanwha Life spun off its exclusive planner organization into a subsidiary in 2021 to implement the separation of manufacturing and sales. After recording net losses of 168.1 billion KRW and 48.2 billion KRW in 2021 and 2022 respectively, HanGeumSeo has now delivered results and even paid a dividend of 1.5 billion KRW to Hanwha Investment & Securities Private Equity (Han투PE), which holds an 11.1% stake in HanGeumSeo. Thanks to HanGeumSeo’s sales power, Hanwha Life’s new contract annualized premium equivalent (APE, a concept converting premiums to an annual basis) increased by 52% compared to the previous year, and protection-type APE grew by 114%. As the number one GA in the industry, HanGeumSeo has transformed from Hanwha Life’s painful finger into a profitable asset.

Inka Financial Services, a KOSDAQ-listed company and the third largest GA by planner size, also posted its best performance since its founding in 1999. Last year, its revenue was 556.8 billion KRW and net profit was 29.5 billion KRW, growing 38.7% and 41.9% respectively compared to the previous year. Since its KOSDAQ listing in February 2022, revenue has increased for eight consecutive quarters over two years. As of the end of last year, the number of planners was 14,516, a 19% increase from the previous year. Inka Financial plans to increase the number of planners to 30,000 within five years.

GA Korea, the second largest GA by planner size, also saw its revenue and net profit grow by 39.2% and 53.3% respectively last year, reaching 940.4 billion KRW and 9.2 billion KRW. The number of planners increased by 4%, from 14,137 in 2022 to 14,708 last year. GA Korea has the highest retention rate of life and non-life insurance planners among the top five GAs, at 65.94%.

Global Financial Sales and Mega, ranked fourth and fifth in the industry, also achieved remarkable results, with net profits more than doubling compared to the previous year. According to statistics from the Korea Insurance Agency Association, last year, life insurance commission income for large GAs with over 500 planners was 5.5282 trillion KRW, a 54.1% increase from the previous year. Non-life insurance commissions rose 22.4% to 5.7688 trillion KRW. Commission income is the revenue GAs earn by selling insurance products on behalf of insurance companies.

GA Growth Supported by Pursuit of Diversity and Competitiveness Enhancement

The growth of GAs is attributed to changes in consumer demand driven by the fintech boom and platform adoption in the financial sector, which fostered services that compare and recommend various products. Unlike exclusive planners who sell products from affiliated insurance companies only, GA planners with multiple products have appropriately responded to these consumer changes and expanded their scale. An official from the Korea Insurance Research Institute explained, "It has become a common practice for consumers to compare various products from multiple companies when purchasing insurance," adding, "Consumers’ growing interest in insurance remodeling based on coverage analysis and product comparison to reduce premiums is also a major factor in GA growth."

Another reason for the rapid growth of GAs is their active investment in education and IT infrastructure to enhance planners’ competitiveness, as GAs generally have less product expertise compared to exclusive planners. For example, HanGeumSeo partnered with nine major non-life insurers to enable GA planners to provide integrated life and non-life insurance consulting. They also introduced sales support platforms like 'Orange Tree' and customer management platforms like 'Orange Touch.' These systems allow planners to access partner insurers’ sales systems with a single login and immediately link entered customer information with the insurers. A Hanwha Life official said, "We provide customized online and offline training to HanGeumSeo through Hanwha Life’s infrastructure," adding, "Planner salaries have increased 1.7 times in three years, from 42.21 million KRW in 2020 to 71.39 million KRW in the first quarter of this year, and we spare no expense on salaries and welfare."