The general insurance industry in South Korea is poised for steady growth, with direct written premiums (DWP) expected to increase at a compound annual growth rate (CAGR) of 5.2%, from KRW34.1 trillion ($26 billion) in 2024 to KRW43.5 trillion ($33.3 billion) in 2029. This growth is driven by economic recovery, mandatory insurance regulations, and a heightened focus on data protection, according to GlobalData, a leading data and analytics company.
According to GlobalData’s Insurance Database, South Korea’s general insurance industry is estimated to grow by 5% in 2024, driven by compulsory lines of insurance and increased awareness for data protection, leading to higher demand for liability insurance products.
Aarti Sharma, Insurance Analyst at GlobalData, comments: “The South Korean general insurance industry may face potential premium price increases in the short-term due to the escalating geopolitical crisis in the Middle East that can potentially influence the prices of important commodities, given the country’s high reliance on trade.”
Motor insurance is the largest line of business, which is expected to account for 59.9% share of the DWP in 2024. It is expected to witness a slower growth of 1.7% in 2024 due to a decline in vehicle sales.
The growing popularity of digital channels offering lower prices and usage-based insurance is reducing premium income growth per policy. However, rising repair costs due to inflation are driving insurers to adjust premiums, supporting short-term motor insurance growth. Motor insurance is projected to grow at a 4.5% CAGR over 2025-2029.
Liability insurance is the second leading line with a 13.7% DWP share in 2024. It is expected to grow by 12.2% in 2024, propelled by favorable regulatory developments and mandatory insurance classes for both individuals and businesses, encompassing third-party liability and professional indemnity policies.
South Korea introduced regulatory measures in 2024 to boost liability insurance. The Virtual Asset User Protection Act mandates virtual asset service providers (VASPs) to secure liability insurance or reserves for safeguarding users against security breaches. Similarly, revisions to the Personal Information Protection Act require entities handling personal data to ensure coverage for breaches. Liability insurance is set to grow at an 8.1% CAGR over 2025-2029
Non-life personal accident and health (PA&H) insurance is estimated to account for 6.9% of DWP share in 2024. It is projected to grow by 14% in 2024, driven by an aging population and heightened health awareness. Additionally, longer waiting times within the National Health Insurance Services, and rising medical costs are fueling the demand for private health insurance in South Korea. Non-life PA&H insurance is expected to grow at a CAGR of 5.1% over 2025-2029.
Property, financial lines, marine, aviation, transit (MAT), and other general insurance is estimated to contribute around 19.5% DWP share in 2024.
Sharma concludes: “The general insurance industry in South Korea is poised for steady growth, driven by an economic recovery and mandatory insurance requirements. The industry’s resilience and adaptability to changing market conditions and expanded scope for liability insurance are likely to contribute to the industry’s growth trajectory in the coming years.”
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