Fubon Hyundai Life solidifies foothold in Korea

CEO Lee Jae-won eyes fourth term to spur growth

Fubon Hyundai Life Insurance CEO Lee Jae-won (Fubon Hyundai Life Insurance)

Fubon Hyundai Life Insurance, the Korean unit of Taiwan's Fubon Financial Group, is making steady progress in solidifying its foothold in South Korea under the robust leadership of CEO Lee Jae-won.

Establishing a presence in Korea is no easy task for a minor foreign insurer, yet Fubon Hyundai Life has been on an upward growth trajectory as it approaches its sixth anniversary next month.

Notably, the company has effectively shifted from a sole focus on retirement pensions to offering more diversified channels, including bancassurance, general agencies and enhanced telemarketing efforts. The firm has also introduced product innovations, such as the "Zero" and "Max" collections and the "My Pick" health insurance, tailored to the needs of Korean customers.

These initiatives have led to a 43 percent increase in total assets since the life insurer's official launch as a Fubon brand in September 2018, along with a 41 percent rise in retirement pension reserves during the same period.

The revenue from monthly initial payment insurance fee, a key performance metric, more than tripled from 4.1 billion won ($3.1 million) in 2021 to 13.2 billion won in 2023, while customer complaint cases decreased sharply from 17.24 in 2019 to 2.7 in the first half of 2024. The return on assets also increased to 3.6 percent in the first half of 2024, reflecting a positive trend in profitability, the firm noted.

Fubon Hyundai Life was acquired from Hyundai Motor Group in September 2018 by Fubon Group, a leading Taiwanese financial conglomerate. Fubon Group operates globally through its flagship entity, Fubon Financial Holding, which operates in nine Asian countries.

The acquisition positioned Fubon Life, a key subsidiary of Fubon Financial Holding, as the major shareholder of Fubon Hyundai Life.

An insurance expert with decades of experience, Lee has successfully led Fubon Hyundai Life through its transformation. Initially appointed as the final CEO of Hyundai Life in January 2017, Lee's leadership earned the trust of Fubon Group, leading to his continued role as CEO following the acquisition.

Under his strategic guidance, Fubon Hyundai Life achieved its first net annual profit in seven years in 2018. Although the company posted its first loss since then in 2023, primarily due to the new IFRS 17 accounting standards, it quickly rebounded with a net income of 27.2 billion won in the first half of 2024.

The life insurer has also made notable progress in qualitative improvements, particularly in enhancing customer service. The company established a Financial Consumer Protection Charter in 2021 and created a dedicated committee in 2023, earning the Consumer-Centered Management certificate from the Fair Trade Commission.

In addition, Fubon Hyundai is also committed to cultivating in-house opinion leaders who will drive corporate cultural change and ensure sustained growth.

Fubon Hyundai Life has also embraced environmental, social and governance (ESG) principles, investing over 1.2 trillion won in eco-friendly finance while advancing efforts to reduce carbon emissions, enhancing digital services with a paperless system, and improving workplace safety.

Support from its largest shareholder, Fubon Life in Taiwan, has been vital for the Korean subsidiary's growth. This support includes not only strategic guidance but also direct capital infusions. Starting with an initial 220 billion won recapitalization in December 2015, Fubon Life has provided a total of 1.3 trillion won in paid-in capital increases for Fubon Hyundai Life so far.

Meanwhile, Lee, whose current term ends Sept. 14, is on track to secure his fourth term as CEO. The Board Nomination Committee recently recommended him as the sole candidate for reappointment, and he is expected to be officially confirmed at the extraordinary shareholders' meeting on Sept. 13.

In a recent meeting with employees, Lee underscored the urgent need to "focus on enhancing the company’s internal capabilities and strengthening competitiveness to secure future growth drivers."

He further emphasized, "To achieve sustained growth, every department must align with a unified goal and concentrate on robust management practices to enhance customer value through product development and services tailored to their needs."

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