Kyobo Life will absorb its wholly-owned internet life insurance subsidiary, Kyobo LifePlanet.
Kyobo Life held a board meeting and approved a plan to absorb the existing business and personnel of Kyobo LifePlanet on Tuesday. Kyobo LifePlane also held a board meeting on the same day and approved the merger plan. This merger qualifies as a "small-scale merger" in which Kyobo Life absorbs its 100% subsidiary, Kyobo LifePlane, allowing it to bypass shareholder approval and proceed with board approval instead. The companies plan to complete the merger by April next year after completing necessary procedures, including applying for regulatory approval from financial authorities. (MoneyToday, September 8 [Exclusive] Kyobo Life to absorb 'digital experiment' Kyobo LifePlane within this year)
Kyobo LifePlane customers will be able to continue using their insurance contracts and services through existing apps or websites even after the merger. System integration will be carried out in stages to avoid any inconvenience to customers. This integration is a strategic move aimed at combining Kyobo Life's stable foundation for insurance business with the digital capabilities accumulated by Kyobo LifePlane over more than a decade, thereby creating digital competitiveness and an innovation engine for the Kyobo Group.
With advancements in new technologies such as artificial intelligence (AI), the importance of continuous large-scale investment in technology and infrastructure for life insurers has grown even greater. Kyobo Life and Kyobo LifePlane determined that consolidating capabilities within the group rather than operating as independent entities would be more effective in enhancing capital efficiency and securing sustainable digital competitiveness in response to these environmental changes.
The goal is to internalize the innovation and agility of Kyobo LifePlane into Kyobo Life and apply them across all aspects of insurance business, including product development, marketing, customer management, and sales channels. To this end, a new independent business division tentatively named "Life Planet Division" will be established, and the Life Planet brand will continue to be utilized to maintain its legitimacy as Korea's first digital life insurance company.
Launched in 2013, Kyobo LifePlane has built an environment where customers can complete all processes—from signing up for insurance to maintaining contracts and filing claims—online without going through a planner. As of the end of June, it had approximately 230,000 customers, total assets of 527.3 billion won, insurance income of 9.1 billion won in the first half of this year, and a solvency margin ratio (K-ICS) of 162.97%.
The decision to merge was also influenced by changes in the regulatory environment for the insurance industry, including the introduction of new accounting standards (IFRS17) and K-ICS. Under strengthened capital adequacy regulations, it was judged that there are structural limitations for digital insurers to sustain independent growth. This is because relying solely on short-term, small-amount, savings-type insurance products—the main offerings of digital life insurers—makes it difficult to sufficiently secure the Insurance Contract Service Margin (CSM), which forms the future revenue base, and to maintain a stable K-ICS ratio.
A Kyobo Life official stated, "Since the regulatory environment for the insurance industry changed, the board has discussed multiple times the best measures to ensure customer protection, ultimately deciding on absorption merger. By combining Life Planet's digital expertise, innovation, and agility with Kyobo Life's insurance business capabilities, we will provide customers with better products and services."
in FINANCE
