It was another year of encouraging success in 2021 for our domestic engineering insurance business. We delivered strong performance both in growth and profitability for the third consecutive year. Our premium income jumped by 17% to KRW 216.4 billion in 2021, and we recorded the largest underwriting profit in the history of our domestic engineering business. These exceptional results reflect our ceaseless efforts to support the stable growth of our clients in the face of ongoing economic uncertainty arising from COVID-19. The gradual recovery of the engineering market in Korea also worked in favor of our business growth.

Market conditions are forecast to remain favorable this year too. To begin with, the Korean government has continuously increased the nation’s social overhead capital (SOC) in order to stimulate the economy. The SOC budget for 2022 has been raised by 5.7% to KRW 28 trillion. In addition to government-led infrastructure development, privately financed infrastructure projects driven by government initiatives will also be smoothly launched, spurring the growth of the engineering insurance market.

Secondly, the government remains committed to promoting the development of the renewable energy sector. In this regard, the government intends to expand the nation’s renewable energy capacity to 63.8GW by 2030 from 27.5GW in early 2022. As a leading provider of reinsurance protection with respect to the construction and operation of renewable power plants, we expect our business to gain more traction and subsequently positive momentum from the upcoming growth of the eco-friendly energy sector, which will also facilitate the expansion of the domestic engineering insurance market.

Korean Re will make every effort to seize upon these favorable market conditions to our full advantage and drive our top-line growth while also seeking to maintain profitability based on meticulous risk analysis and management. This will ultimately help us deliver value for our clients and business partners as well as for our company.

Our overseas engineering insurance business showed positive growth in 2021, recovering successfully from a contraction in 2020. It was also a landmark year for us as we booked KRW 116 billion in gross written premiums in 2021, passing the USD 100 million mark for the first time in the history of our overseas engineering business. This also represents an increase of 12% from the previous year.

Our business growth was supported by improving market conditions, as the global construction industry experienced a solid recovery from a pandemic-triggered slump. In 2021, the construction market made a turnaround to achieve growth that exceeded pre-pandemic levels amid an economic rebound and accelerating vaccine rollouts.

In 2022, the market is set to continue growing since many delayed projects are about to resume as global supply chains stabilize. The growth will also be driven by the execution of large-scale investments in new infrastructure including green energy generation facilities.

After 2022, the global construction market is expected to enter a stage of stable growth, extricating itself from the influence of COVID-19, and Korean construction companies are also likely to see their overseas business orders increase significantly due to favorable oil prices and rising global demand for plant construction.

In line with this market outlook, we will be able to maintain our growth momentum in 2022, although growth will be sought after with a focus placed on improving our long-term profitability. In order to produce sound and sustainable business results, we will respond nimbly to any market changes and stay committed to developing and strengthening our long-term relationships with many strategic partners and key clients across the globe.