Foreign Insurance Company CEOs Consecutively Secure Reappointments... Attention Also on the Future of Domestic Insurers' Heads

Foreign Insurance Company CEOs Drive Performance Growth
70s-born Jo Ji-eun and Lee Jae-won Successfully Reappointed
Domestic Insurers Like Shinhan and KB Also Begin CEO Appointment Process

CEOs of foreign insurance companies have recently succeeded in consecutive renewals. It appears they chose stability over change based on outstanding management performance. Among domestic insurance company CEOs whose terms end by the year-end, the atmosphere generally leans toward renewals, except for a few.

According to the financial sector on the 24th, LINA Life recently held a nomination committee meeting and solely recommended CEO Jo Ji-eun as the next CEO candidate. As the American insurance company Chubb is the sole shareholder holding 100% of LINA Life's shares, Jo is expected to smoothly secure renewal at the extraordinary shareholders' meeting scheduled for October 29.

Born in 1975, Jo is relatively young among insurance industry CEOs. Since taking office as CEO of LINA Life in December 2020, she has led performance growth. LINA Life's net profit steadily increased from 233.1 billion KRW in 2021 to 363.1 billion KRW in 2022, and 464 billion KRW in 2023. The net profit for the first half of this year was 262.7 billion KRW, a 40.2% increase compared to the same period last year.

Jo will lead Chubb Group's strategy to revamp the LINA brand. In June, Chubb Group renamed Ace Insurance, an affiliate like LINA Life, to LINA Insurance and launched an integrated brand centered on 'LINA' along with LINA Life and LINA One. They are creating synergy by integrating telemarketing (TM) sales functions of LINA Life and LINA Insurance into LINA One, a subsidiary-type corporate insurance agency (GA).

Fubon Hyundai Life, whose largest shareholder is Taiwan's Fubon Financial Group, recently confirmed the renewal of CEO Lee Jae-won through an extraordinary shareholders' meeting and board meeting. Lee, who joined as CEO of Hyundai Life, the predecessor of Fubon Hyundai Life, in 2017, is now serving his fourth consecutive term. Born in 1972, Lee is one of the six insurance industry CEOs born in the 1970s. In the first year of Fubon Hyundai Life's launch in 2018, he turned the deficit that had continued since 2012 into a surplus. The net profit for the first half of this year was 27.2 billion KRW, a 31.4% increase compared to the same period last year.

However, the low solvency margin ratio (K-ICS) remains a long-term challenge for him. After applying transitional measures in Q1 this year, K-ICS was 182.8%, exceeding the financial authorities' recommended level (150%), but before the transitional measures, it was 19%, the lowest in the life insurance industry. Lee plans to stabilize new systems such as the International Financial Reporting Standard 17 (IFRS17) and K-ICS, introduced since last year, and attempt product diversification accordingly.

MetLife Life, an American insurance company, also confirmed the renewal of CEO Song Young-rok in the second half of this year. Song, who took office as CEO of MetLife Life in September 2018, is now serving his third consecutive term. Net profit grew about threefold from 129.4 billion KRW in 2018, his first year in office, to 373.5 billion KRW last year. K-ICS in Q1 this year was 356.3%, ranking among the top in the life insurance industry.

Song's challenge is diversifying product composition. MetLife Life has strengths in investment-linked insurance such as dollar insurance and variable insurance but is considered somewhat disadvantaged under the IFRS17 system. It recorded a net loss of 32.8 billion KRW in Q1 this year. Song is expected to actively target the third insurance market, including disease, accident, and nursing care insurance.

Among domestic insurance companies, CEO Lee Young-jong of Shinhan Life, CEO Kang Byung-kwan of Shinhan EZ Insurance, and CEO Lee Hwan-joo of KB Life Insurance are approaching the end of their terms this year.

Among financial holding companies, Shinhan Financial Group is accelerating its subsidiary CEO appointment process. Lee Young-jong, who became head of Shinhan Life in January 2023, significantly increased the proportion of protection insurance in line with IFRS17. Last year's net profit was 472.4 billion KRW, a 5% increase from the previous year. The net profit for the first half of this year was 312.9 billion KRW, slightly up from 311.7 billion KRW in the same period last year. Lee is highly likely to be renewed, having grown the company to a level that threatens Kyobo Life, the industry's third-largest.

However, CEO Kang Byung-kwan of the same Shinhan affiliate may be replaced to reverse the atmosphere. Kang has been CEO since the launch of Shinhan EZ Insurance in July 2022. Shinhan EZ Insurance has suffered chronic deficits every year. It recorded a net loss of 6 billion KRW in the first half of this year, about 3.6 times larger than the same period last year. Recently, it even failed to acquire its first exclusive usage rights, continuing to struggle.

Lee Hwan-joo, CEO of KB Life Insurance, who has accumulated practical experience in management, finance, and sales over 34 years at KB, is expected to be smoothly renewed. Lee took office as CEO of KB Life Insurance in January last year and is leading the silver industry. In October last year, he acquired 'KB Golden Life Care,' the first nursing business specialized subsidiary in the financial sector, and in December of the same year, opened the silver town 'Pyeongchang County' in Pyeongchang-dong, Jongno-gu, Seoul. He aspires to become the number one senior business by 2023.