[Issue Interview] Jang Younggeun, CEO of KakaoPay Insurance: "Optimizing Insurance the IT Way, Refining to Perfection"

Jang Younggeun Reappointed as CEO of KakaoPay Insurance
Building on Overseas Travel Insurance Success, Sets Sights on Health Insurance
Continued Launch of AI-Enhanced and Customer-Customized Insurance Products

"We revised our overseas travel insurance 35 times over the past two years. Our way of working is to improve service efficiency by optimizing even a single word, always reflecting the voices of our customers."

Jang Younggeun, CEO of KakaoPay Insurance, made this remark in an interview with Asia Economy. He said, "Unlike traditional insurance companies, we are a company with an IT background." Jang's management philosophy is that, rather than relying on push sales by professional planners who recommend insurance products, if you refine products to meet customer needs, word of mouth will spread and customers will come on their own.

Jang Younggeun, CEO of KakaoPay Insurance, is being interviewed by Asia Economy. KakaoPay Insurance

Jang cited overseas travel insurance as an example. KakaoPay Insurance first launched its overseas travel insurance in June 2023, and as of last month?two years after launch?it surpassed 4 million cumulative subscribers. The key to its popularity was the 'DIY' (Do it yourself) feature, which allowed users to select only the coverage they needed. Jang explained, "General insurance products tend to include unnecessary coverage in order to absorb sales costs, but we broke away from this model and allowed customers to choose only the essential coverage. We also simplified the subscription and claims process through familiar platforms like Kakao and KakaoPay."

Another success factor for the overseas travel insurance was the 'refund system,' which returns 10% of the premium to customers if no claims are made. KakaoPay Insurance was the first in the industry to introduce this system, and since then, several other insurers have adopted similar benefits, allowing KakaoPay Insurance to play a disruptive 'catfish' role in the market. Jang said, "The refund system touches on customer satisfaction, much like receiving a benefit for leaving a positive review. It also carries the meaning of celebrating a safe return from a trip."

Jang, who became CEO in July 2023, was confirmed for another term at the extraordinary general meeting of shareholders held on the 23rd. He will lead KakaoPay Insurance until the end of 2026. Jang has established four strategic areas?digital, leisure, life, and embedded?and has developed innovative insurance products tailored to each. Representative examples include overseas travel insurance, mobile phone insurance, driver insurance, and Jeonse security insurance.

Jang plans to maintain these four basic frameworks while introducing a variety of products that have not been tried before. He described his second term as a period to "harvest the seeds that have been sown." Jang said, "Previously, it took more than seven to eight months to plan and launch a single product, but now we have many projects running in parallel. I expect the product launch cycle to become much shorter moving forward."

Jang Younggeun, CEO of KakaoPay Insurance, is being interviewed by Asia Economy. KakaoPay Insurance

KakaoPay Insurance recently marked the beginning of a new phase by launching a health insurance product. This product is composed of five basic coverages centered on major illnesses such as cancer, cerebrovascular disease, and ischemic heart disease, along with eight customizable packages. While previous products focused mainly on short-term, small-amount, and mini-insurance, this is the first time the company has expanded its portfolio to adult health insurance. Jang explained, "Last year, we launched insurance for infants and elementary and middle school students as part of our personal insurance line, and this health insurance is the follow-up. Since disease risks and necessary coverage differ by age, we segmented the product to focus on the essential coverage needed for each age group."

Artificial intelligence (AI) capabilities are also being enhanced. The company has trained large language models (LLMs) on all insurance policy terms and conditions. This enables customers to easily check for overlapping coverage in their policies or to understand in what situations specific riders can be used. Jang said, "Currently, we are using AI for automated underwriting, claims process simplification, and risk analysis, and we also operate a 24-hour customer support chatbot. In the future, we plan to expand the scope of AI applications to include personalized product recommendations, real-time risk prediction, and advanced fraud detection."

In the first quarter of this year, KakaoPay Insurance recorded a net loss of 13.7 billion won. Like other digital insurers, KakaoPay Insurance still faces the challenge of turning a profit. Jang said, "The insurance business inherently involves significant costs for system development, IT and personnel investment, and compliance with accounting standards. However, since loss ratios for each product are being managed stably, I believe performance will improve as we scale up."

Jang also expressed the opinion that flexible regulatory measures are needed for the sustainable growth of domestic digital insurers and to benefit consumers, especially given the chronic deficits in the sector. Currently, there are growing calls within the digital insurance industry for different regulatory hurdles?such as capital adequacy ratios (K-ICS)?compared to those applied to traditional insurers. Jang said, "In the pharmaceutical industry, regulations differ between prescription drugs that require expert intervention and over-the-counter drugs available at pharmacies. In the insurance industry as well, if a flexible regulatory environment is established for digital insurance products that customers can easily access and understand, as opposed to traditional insurance products that require the help of experts (planners), customer innovation will accelerate even further."