In 2021, the long-term insurance market in Korea continued on its growth path, with direct premiums increasing by 5.3%. The growth of the market was supported by strong sales of long-term personal accident and health insurance policies. The market also witnessed greater interest in long-term property insurance in the wake of a series of fire accidents in 2021.
In terms of overall claims experience, insurers suffered some setbacks in 2021 when loss ratios started to go up after an unexpected improvement in 2020 following the outbreak of COVID-19. Particularly, the relaxation of social distancing measures led people who had delayed elective and non-emergency care to visit hospitals, pushing up insurance claims.
In 2021, Korean Re reported KRW 2,532 billion in long-term insurance premiums, up 5.1% year on year. We continued to focus on writing more profitable risks by working closely with direct insurers to develop new products. However, our combined ratio before management expenses increased by 0.3%p to 100.5%, as the loss ratio of medical expense insurance remained high.
In 2022, the long-term insurance market will stay on a similar growth trajectory as the previous year. Market growth will be backed by rising medical expense insurance rates and intensive marketing efforts by insurers to sell newly developed products, especially those that target the elderly or people with chronic or pre-existing conditions.
In step with such market developments, Korean Re will continue to support the market in terms of product development based on an extensive analysis of product portfolios of insurers. We will also provide underwriting services and necessary reinsurance programs, as well as risk transfer solutions, in a way that supports the sustainable growth of insurers offering long-term insurance coverage. As insurers have been working to switch to IFRS 17, we will make sure our efforts are directed toward responding to their needs, such as risk management and solvency capital relief, by being more attentive to their individual business profiles and conditions. These efforts will not only support their growth and business stability but also help us drive growth and enhance profitability.
Gross Written Premiums: Long-term
(Units: KRW billion, USD million)
| FY 2021 (KRW) | FY 2021 (USD) | FY 2020 (KRW) | FY 2020 (USD) | |
| Long-term | 2,531.5 | 2,202.5 | 2,408.0 | 2,020.5 |