Financial Supervisory Service Begins Special Inspection of Lotte Insurance Two Months After Regular Check

Focused Inspection on Capital Adequacy

The Financial Supervisory Service (FSS) has commenced a regular inspection of Lotte Insurance. This comes two months after the year-end regular inspection.

According to financial authorities on the 6th, the FSS is conducting an ad-hoc inspection of Lotte Insurance from the 5th of this month until March 21st. This is a follow-up inspection to the year-end regular inspection conducted last year.

The FSS is expected to review the management evaluation and the items checked during the regular inspection from June last year. Additionally, they plan to closely examine Lotte Insurance's risk management related to overseas real estate alternative investments.

Lotte Insurance's solvency margin ratio (K-ICS) stood at 159.77% as of the end of September last year, which is a 13.3 percentage point decrease compared to the previous quarter. Financial authorities recommend maintaining it above 150%.

Furthermore, the FSS will conduct additional evaluations during this inspection to determine the management evaluation grade. If the company receives a grade of 4 or below in the Risk Assessment and Analysis System (RAAS), it will be designated for prompt corrective action and face strong demands for management improvement.