December 21, 2024

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From left: MetLife Korea CEO Song Young-rok., Lina Life Insurance CEO Cho Jee-eun and Fubon Hyundai Life CEO Lee Jae-won (Pictures courtesy of each company)

The CEOs of major foreign insurance firms in Korea have been reappointed as they navigate challenges posed by a slowing market and local competition.

Lina Life Insurance, the Korean unit of American insurance group Chubb, recently nominated current CEO and President Cho Jee-eun as the sole candidate for reappointment. Barring any unexpected issues, she is expected to secure her next term at the extraordinary shareholders meeting on Oct. 29.

Fubon Hyundai Life’s Lee Jae-won and MetLife Korea’s Song Young-rok have also secured consecutive terms, with Lee’s third reappointment announced in September and Song’s confirmed in July.

These reappointments were anticipated, as all three leaders have consistently demonstrated strong management and performance enhancement.

Cho, who took the helm of Lina Life in December 2020, has improved the firm’s financials, with net profit rising from 233.1 billion won ($171.1 million) in 2021 to 363.1 billion won in 2022. Last year, Lina Life ranked fifth among life insurers with an annual net profit of 464 billion won.

Cho has earned significant trust from Chubb, having been appointed CEO of Lina Life after the company's acquisition from Cigna in 2022. In March, she was also named senior country executive of Chubb Korea, overseeing Lina Life, Lina General Insurance and Lina One.

Her primary goal for the upcoming term is to establish the new ecosystem that Chubb envisions for Lina in Korea. In May, Chubb rebranded its Korean operations under the unified Lina brand. Cho’s main task will be to integrate these entities to foster synergy and solidify the new brand in the local market.

Song began his third term as CEO of MetLife in July, having first taken leadership in September 2018. Under his guidance, MetLife's net profit nearly tripled from 129 billion won in 2018 to 373.5 billion won last year, ranking sixth among life insurers. MetLife also achieved the highest Korean Insurance Capital Standard, or K-ICS, among life insurers in the first half of this year, underscoring its strong capital adequacy and risk management capabilities.

However, MetLife faces significant challenges in diversifying its portfolio. Known for its investment-linked products, such as variable and dollar insurance, variable insurance accounted for over half of its total premium income. In the first quarter of this year, substantial investment losses, coupled with stagnant insurance profits, resulted in a loss of 32.8 billion won.

As he begins his new term, Song aims to position MetLife among the nation’s top five life insurers, prioritizing product and customer diversification.

In his fourth term, Lee also faces the challenge of improving Fubon Hyundai Life’s declining profits and diversifying its product offerings.

Since taking office in January 2017, Lee led Fubon Hyundai Life to its first annual profit in seven years in 2018, coinciding with the company's transition from Hyundai Motor Group to Taiwan's Fubon Group. He enhanced performance, with net profit rising from 110.8 billion won in 2019 to 185.9 billion won in 2021.

However, net profit fell to 29.3 billion won in 2022, primarily due to the new IFRS 17 accounting system, and further declined to a net loss of 110.5 billion won in 2023, before rebounding slightly to a half-year net profit of 27.2 billion won this year.

Lee will put his efforts into broadening the company’s product portfolio, moving beyond a focus on retirement pensions to include more products and channels.

An industry official noted that foreign insurers face similar challenges in adapting their portfolios to meet evolving market demands.

"While larger domestic insurers can engage in various services, such as long-term care, foreign insurers, smaller players must compete primarily through their products. With changing accounting systems and market environments, smaller life insurers are required to expand their offerings, especially endowment-focused products, to enhance profitability," the official said.

By Choi Ji-won (jwc@heraldcorp.com)