South Korea's major non-life insurers saw their auto insurance loss ratios climb in the first quarter, despite premium increases implemented earlier this year.
According to the financial industry on Tuesday, the cumulative auto insurance loss ratio for the four major insurers — Samsung Fire & Marine Insurance (000810.KS), Hyundai Marine & Fire Insurance, DB Insurance and KB Insurance — stood at 85.9% in the first quarter, up 3.4 percentage points from a year earlier. The auto insurance loss ratio in March came in at 81.5%, rising 4.0 percentage points from the same month last year.
Factoring in operating expenses, the break-even point for auto insurance is a loss ratio of around 80%. While major insurers raised auto insurance premiums by more than 1% this year, analysts attribute the deterioration to the cumulative impact of past premium cuts. "Once spring outings pick up in earnest from April, traffic volumes will rise and auto accidents are likely to increase as well," an official at a non-life insurer said.
