With the integration of Dongyang Life and ABL Life gaining momentum, Woori Financial Group's insurance business has emerged as a new variable in the race for fifth place in the life insurance industry.
Woori Financial launched integration efforts between Dongyang Life and ABL Life on the 18th, targeting completion in the second half of next year. Following its acquisition of the two insurers last July, Woori Financial completed the full subsidiary status of Dongyang Life via a comprehensive stock exchange on the 11th of this month. It immediately moved to merge the two insurers, quelling concerns and rumors about the potential sale of ABL Life that had been raised by some. Once the integration is finalized, the number of life insurers will be reorganized from 22 to 21, leading the industry to welcome this merger.
As of the end of last year, the integrated insurer's assets stood at approximately 55 trillion won, with held contract CSM (contract margin) amounting to around 3.5 trillion won. Competition is expected with NH Nonghyup Life (4.8 trillion won) and KB Life Life (3.7 trillion won) for fifth place in the industry.
Most notably, the integrated life insurer's sales channels are expected to diversify. There is high internal expectation that it can combine Woori Bank's bancassurance with Dongyang Life's strength in GA (corporate insurance agencies) and ABL Life's sales power, which has aggressively expanded its FC (exclusive agent) organization. Dongyang Life has rapidly expanded the sale of protection-type insurance by leveraging GAs. As of the first half of this year, the share of GA channels among Dongyang Life's new contract APE (annualized premium equivalent) stood at 54 percent.
ABL Life is recently intensifying efforts to expand its FC organization. ABL Life is accelerating the expansion of exclusive channels with a goal of 4,000 FCs by 2027. The number of active personnel in the FC channel was 2,129 at the end of 2024 and has risen to over 2,800 this year. If combined with Dongyang Life, the total number of FCs would reach 4,582, placing it within the fifth-tier range of the life insurance industry.
Furthermore, while Dongyang Life has a high proportion of protection-type insurance, ABL Life has a relatively larger share of savings-type insurance, which is seen by the industry as an opportunity to complement its product portfolio. Additionally, new customer acquisition leveraging Woori Financial's customer base is expected, and joint investments at the group level, along with the long-term contract characteristics of life insurers, are anticipated to lead to active expansion into new businesses such as nursing care operations or healthcare services, similar to other major life insurers.
Woori Financial's strategy through this integration is to concentrate group-level capabilities to cultivate the integrated insurer as a key subsidiary of the group. The plan is to secure stable capital adequacy for the integrated insurer while enhancing competitiveness in the insurance market by prioritizing management that values CSM, the source of future profits.
Im Jong-yong Woo Ri-geum-yung (Chairman) is scheduled to hold a group CEO town hall meeting attended by executives and team leaders from both insurers on the 19th to share the direction and vision of the integration.
A life insurance industry official stated, "The merger of the two companies will increase their scale to become a fifth-tier life insurer in the industry, and mutual complementarity is expected in terms of products and sales organizations." The official added, "Ultimately, it depends on how much new protection-type contracts and new CSM can be expanded by utilizing the integrated channels and products."
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