KOSPIInsurance088350

Hanwha Life Insurance

₩5,310▲ 0.38%2026-10-02 close

Market Cap

₩4.6T

Turnover

₩10.9B

Volume

2.1M

Shares out.

870M

PER

4.9×

PBR

0.3×

EPS

₩1,160

Dividend Yield

0.00%

PER, EPS, PBR and BPS are calculated in-house from the last 4 quarters (2025Q3–2026Q2) · Dividend yield is based on ₩0 per share · Prices as of the 2026-10-02 close

Report overview

Profit Recovery Meets Capital Rules

Insurance and investment results have improved together, lifting recent quarterly earnings power, yet the surrender-value reserve burden, the 2027 core-capital rule and a roughly KRW 1 trillion Acuon acquisition are testing capital capacity all at once.

1
Owner-attributable net profit was KRW 324.4 billion in 1Q26 and KRW 447.6 billion in 2Q26, so the two quarters combined already exceeded full-year 2025 owner net profit of KRW 641.3 billion.
2
The company said first-half separate-basis insurance profit rose 62% to KRW 285.3 billion and investment profit jumped 776% to KRW 354.8 billion, while new-business CSM of KRW 1.30 trillion was the highest first half since IFRS17 adoption.
3
The K-ICS ratio stood at a preliminary 167.0% at end-June, up 9.5 percentage points from end-2025, but remains low relative to the industry average, and the core-capital ratio rule slated for 2027 remains a hurdle.
4
The surrender-value reserve has accumulated to nearly the same size as retained earnings, effectively exhausting dividend resources, and regulatory reform is seen as the gateway to any dividend restart.
5
Selected as preferred bidder for the Acuon Capital and Acuon Savings Bank package, the company is expanding its non-insurance portfolio while debate over the capital burden from the price and financing structure has intensified.

Business structure

Hanwha Life is a major Korean life insurer whose earnings rest on core insurance results and asset-management gains, with domestic and overseas subsidiary profits added on top.

In group structure, it is the largest shareholder of Hanwha General Insurance with a 51.36% stake, exerts influence over Hanwha Investment & Securities (46.08%) through wholly owned Hanwha Asset Management, and fully owns Hanwha Savings Bank, Hanwha 63 City, Hanwha Loss Adjustment and Hanwha Life Lab.

On products, amid a heavier core-capital solvency burden it has been reshaping its portfolio from short-payment products toward medium- and long-payment protection-type products, prioritizing structural improvement that weighs profitability and capital efficiency together.

Its key sales channel is the captive general agency: as of the first half, Hanwha Life Financial Services had 38,092 agents and the 13th-month persistency ratio was 90.0%. Subsidiaries contribute a meaningful share of consolidated profit.

First-half combined subsidiary net profit was about KRW 500.9 billion, comprising Hanwha General Insurance at KRW 215.3 billion, Hanwha Investment & Securities at KRW 55.7 billion and overseas units at KRW 103.0 billion.

Overseas operations center on Vietnam and Indonesia: in the first half the Vietnam unit posted revenue of KRW 100.7 billion and pretax profit of KRW 40.6 billion, while Indonesia's Nobu Bank posted revenue of KRW 155.3 billion and pretax profit of KRW 37.0 billion.

A lending arm is now being added: on June 30 the company disclosed it had been named preferred bidder for Acuon Capital and Acuon Savings Bank and was in negotiations with the counterparties.

Segment revenue breakdowns are not available in confirmed filings, so this report focuses on operating and net profit plus the profit lines the company has disclosed.

Earnings trend

Quarterly revenue · Operating profit

₩240.7B25Q2₩354.9B25Q3₩180.3B25Q4₩480.8B26Q1₩626.8B26Q2

RevenueOperating profit

Annual revenue · Operating profit

₩0₩1.3T2022₩0₩1.1T2023₩1.1T2024₩1.1T2025

RevenueOperating profit

Quarterly results · Last 5 quarters
Quarter	Revenue	Operating profit	Op. margin
2025Q2	—	₩240.7B	—
2025Q3	—	₩354.9B	—
2025Q4	—	₩180.3B	—
2026Q1	—	₩480.8B	—
2026Q2	—	₩626.8B	—

Annual results
Year	Revenue	Operating profit	Net income (parent)	Op. margin	ROE	Debt-to-equity
2022	₩0	₩1.3T	₩1T	—	5.9%	642.9%
2023	₩0	₩1.1T	₩758.5B	—	5.8%	855.7%
2024	—	₩1.1T	₩737.3B	—	6.3%	1021.6%
2025	—	₩1.1T	₩641.3B	—	4.6%	974.0%

Consolidated basis (financial statements including subsidiaries) · Final figures from DART filings · Net income attributable to owners of the parent · Data as of 2026-09-04

Earnings analysis

On an annual basis, operating profit fell from KRW 1,257.0 billion in 2022 to KRW 1,057.0 billion in 2023, then recovered for two straight years to KRW 1,097.0 billion in 2024 and KRW 1,147.3 billion in 2025.

Owner-attributable net profit, however, declined three years running, from KRW 1,030.3 billion in 2022 to KRW 758.5 billion in 2023, KRW 737.3 billion in 2024 and KRW 641.3 billion in 2025, while total net profit including minority interests was KRW 836.3 billion in 2025 versus KRW 866.0 billion in 2024.

Quarterly, 4Q25 marked the trough, with operating profit of KRW 180.3 billion and owner net profit shrinking to KRW 23.2 billion; Kiwoom Securities noted in a February 2026 report that despite over KRW 100 billion of onerous-contract cost reversals, separate-basis fourth-quarter net profit swung to a loss on worse experience variance and weak investment results.

The trend shifted in 2026. Operating profit was KRW 480.8 billion with owner net profit of KRW 324.4 billion in 1Q26, and KRW 626.8 billion with KRW 447.6 billion in 2Q26, both far above 2Q25 levels of KRW 240.7 billion and KRW 125.1 billion.

The two quarters sum to KRW 771.9 billion of owner net profit, which matches the company's reported first-half owner-attributable net profit of KRW 771.9 billion, up 119.8% year on year.

Management attributed the improvement to simultaneous gains in insurance and investment results, citing separate-basis insurance profit of KRW 285.3 billion, up 62%, and investment profit of KRW 354.8 billion, up 776%.

Summing the four most recent quarters, from 3Q25 through 2Q26, owner net profit reaches KRW 1,062.1 billion, well above the 2025 full-year figure.

Equity totaled KRW 16,623.4 billion at end-2025 (owner KRW 13,875.2 billion, minority KRW 2,748.2 billion), up from KRW 14,278.0 billion at end-2024 but below the KRW 19,694.7 billion of end-2022, while the liabilities-to-equity ratio eased to 974.0% in 2025 from 1,021.6% in 2024.

Operating cash flow of KRW 4,377.2 billion in 2025 was down from KRW 5,428.6 billion in 2024 but still far larger than in 2022 and 2023, at KRW 1,188.5 billion and KRW 1,738.0 billion respectively.

Industry analysis

Life insurance in Korea has become an industry where competition for contract service margin under IFRS17 dictates the profit structure amid stagnant top-line growth.

An industry official said insurance sales have reached saturation, leaving insurance results broadly weak, and that portfolio diversification through investments and subsidiaries has grown more important because underwriting alone cannot lift earnings.

Second-quarter 2026 results diverged sharply among the large players. Samsung Life's first-half insurance service result fell 35.9% year on year to KRW 533.1 billion with second-quarter insurance profit of only KRW 276.6 billion, while Kyobo Life's second-quarter insurance profit dropped 52.8% to KRW 42.7 billion.

On solvency, Hanwha Life sits relatively low. Financial Supervisory Service data showed the industry K-ICS ratio after transitional measures at 216.1% as of end-March 2026, with Samsung Life at 209.9%, Kyobo Life at 214.2% and Shinhan Life at 201.1%, while Hanwha Life stood at 162.1%.

A burden shared across the sector is the surrender-value reserve. Industry-wide reserves reached about KRW 58 trillion at end-June 2026, up KRW 13.9 trillion from a year earlier and 2.4 times the KRW 23.7 trillion of end-2022.

Because amounts exceeding retained earnings are reclassified as supplementary capital, the reserve lowers the core-capital K-ICS ratio due in 2027, drawing criticism as a double squeeze on both dividends and solvency.

Meanwhile, life insurers' push into non-bank finance has become an industry trend: Kyobo Life said it had received Financial Services Commission approval for a change of major shareholder at SBI Savings Bank and was moving to secure a 50%-plus-one stake for about KRW 900 billion. Hanwha Life's Acuon deal sits within this same wave of restructuring.

Outlook

Management's targets are specific.

Hanwha Life has set a goal of at least KRW 500 billion in annual pretax insurance profit, and its business management team leader said claims experience variance should improve significantly and onerous contracts decline substantially, with new-contract-driven onerous cost recognition already falling on the back of product profitability policies.

Capital targets were also raised. On the first-half earnings call the company lifted its year-end K-ICS target back to at least 165%, alongside a core-capital ratio goal of 60% or more.

Sales strategy centers on protection products: the company said it will keep expanding medium- and long-payment whole-life sales in the second half while strengthening protection competitiveness around dementia and long-term care products.

Overseas, the aim is a bigger profit contribution: the overseas business management team leader said the target for overseas subsidiary profit is KRW 200 billion in 2026 and KRW 304.1 billion in 2030, with the current 11% share of profit set to keep rising. Dividends hinge on regulation.

The finance team leader said that if the system is revised to roughly 25% for protection and 35% for savings products, sufficient distributable profit could be secured, but added it was premature to discuss dividend plans as nothing is confirmed.

Deal terms also remain open: the company said the price, structure and financing are not finalized, making it hard to quantify the impact on solvency metrics such as K-ICS, and that no other M&A is being concretely pursued beyond Acuon.

The three checkpoints for the second half therefore narrow to the durability of experience-variance improvement, delivery on year-end capital targets, and finalization of the acquisition structure.

Valuation

PER

4.9×

PBR

0.3×

ROE

7.3%

EPS

₩1,160

BPS

₩18,803

Dividend per share

₩0

Hanwha Life has long been a life insurer whose share price sits low against both its profit base and its book value, trading at a price-to-book multiple well below net assets.

According to Ilyo Sinmun, as of end-2025 the company's price-to-book ratio was markedly lower than those of peers such as Samsung Life, Mirae Asset Life and Tongyang Life.

Looking only at the profit trend, quarterly earnings have recovered from the 4Q25 trough through the first half of 2026, and the sum of the four most recent quarters of owner net profit exceeded the 2025 full-year figure.

On distributions, however, the absence of dividends for two consecutive years covering 2024 and 2025 remains a clear differentiator versus dividend-oriented names in the sector. Brokerage views diverge.

In an August 12, 2026 report, KB Securities maintained a Buy rating and a target price of KRW 5,700, judging that the stock trades at a very low valuation so that K-ICS concerns are largely reflected in the price, while adding that meaningful change requires the company's initiatives to produce visible results.

LS Securities analyst Jeon Bae-seung set a target price of KRW 5,800 on May 13, 2026. Alongside the real-time metrics on the screen card, the way to read this name is to track how three variables resolve: capital ratios, the dividend regime, and the acquisition structure.

PER, EPS, PBR and BPS are all calculated in-house (the same method as Naver and Toss) · Dividend yield = cash dividend per share from DART filings (supplemented by KRX) ÷ current price · As of 2026-09-04

Bull factors

Insurance and investment profits improving together, with record new-business CSM

Owner net profit of KRW 324.4 billion in 1Q26 and KRW 447.6 billion in 2Q26 marked a sharp recovery from the KRW 23.2 billion trough of 4Q25.

First-half new-business CSM rose 40.5% year on year to KRW 1.30 trillion, the largest first half since IFRS17 adoption, while new-business profitability improved to 11.0 times from 7.2 times a year earlier.

The in-force CSM also grew by KRW 214.8 billion from end-2025 to KRW 8.93 trillion, as new-business CSM inflows and smaller experience adjustments offset the application of loss-ratio and expense assumption guidelines. A stable or growing stock of future profit is a supportive factor for earnings consistency.

Capital ratio recovery and a possible dividend restart if rules change

The K-ICS ratio stood at 167.0% at end-June, up 9.5 percentage points from end-2025, as higher profits enlarged available capital and rising rates also helped. That is a preliminary nine-quarter high, the best since 1Q24 and a 12.9 point recovery from the 154.1% trough of 1Q25.

For dividends, the regime is the swing factor: as of the first-half disclosure the surrender-value reserve equaled 97.2% of retained earnings, leaving dividend capacity nearly exhausted, yet the company answered yes when asked whether easing the rules would immediately create distributable profit and shareholder-return resources.

Regulators are reportedly giving strong consideration to normalizing mass-lapse assumptions from the current 80-100% to about 25% for protection and 35% for savings products.

A profit base widening into non-insurance and overseas

Subsidiaries helped lift first-half consolidated results, with combined subsidiary net profit of about KRW 500.9 billion.

A lending business is set to join them: the business planning team leader said adding specialized lending through the capital business to the existing insurance and financial-investment portfolio should strengthen credit functions and Hanwha Finance's competitiveness while improving profitability and earnings stability across the financial arm.

Acuon Capital is a corporate-finance-focused lender with about KRW 9 trillion of consolidated assets as of 2025 and corporate loans at 98.4% of the book, while Acuon Savings Bank holds KRW 5 trillion of assets with a Seoul-area base. Overseas, profit targets of KRW 200 billion for 2026 and KRW 304.1 billion for 2030 have been set.

Bear factors

Surrender-value reserve squeezing both dividends and core capital

Nine major insurers held a combined KRW 41.66 trillion of surrender-value reserves at end-June, with Hanwha Life's balance the largest at KRW 7.30 trillion.

The reserve does not leave capital, but it is excluded from distributable profit under commercial law, so large transfers shrink dividend resources even when accounting profit is positive.

In an August 2026 report, KB Securities said concerns over the core-capital ratio from the growing reserve persist and estimated that the second-quarter reserve had exceeded retained earnings. Reform is not yet confirmed, leaving both timing and magnitude uncertain.

Low absolute K-ICS level and a record of missing guidance

Hanwha Life's K-ICS ratio has trended down, from 183.8% in 2023 to 163.7% in 2024 and 157.5% in 2025. Guidance has also been missed repeatedly.

In November 2024 the company pointed to 175% or higher by year-end but delivered 163.7%; guidance of 170%-plus given in early 2025 ended at 157.5%, with wider claims experience variance cited as the main cause of the shortfall.

The 167% of 2Q26 clears a lowered bar but still falls short of the original 175% aspiration and of the 180%-plus levels seen through 2023. The core-capital K-ICS ratio fell from 73.81% in 4Q24 to 58.09% in 4Q25.

Capital burden and integration risk from a KRW 1 trillion-scale deal

The price discussed in the market is around KRW 1 trillion, and a large purchase of unlisted financial-company shares can add capital burden through higher risk charges, with any drop in K-ICS potentially forcing capital raising.

The company said it cannot detail the K-ICS impact until the structure and price are fixed, and credit rating agencies have noted that once the deal is confirmed, higher required capital could pressure the ratio downward.

The Korea Deposit Insurance Corporation, the second-largest shareholder, is reported to have asked the company about the appropriateness of the price and the post-deal K-ICS impact.

Post-merger integration and solvency management are seen as key variables, with risk management and role division versus the savings bank flagged as tasks given the capital arm's heavy corporate-loan mix.

Risk factors

Rate and market volatility

Because K-ICS marks both assets and liabilities to market, the ratio can swing widely with variables such as interest rates. The company said it estimates the ratio would rise by 0.4 percentage points if domestic and overseas rates each moved up 10 basis points.

At the industry level, equity market gains have been shown to cut both ways, lifting other comprehensive income while also increasing equity risk charges. With part of the investment-income improvement resting on alternative asset valuations and variable-account results, volatility could rise if market conditions turn.

Regulatory and rule changes

Regulators intend to present a fundamental revision of the surrender-value reserve system in step with the first application of core-capital rules in 2027, but they view excessive competition in health insurance as the cause of the reserve surge, so additional rules on acquisition expenses are also under discussion.

An industry official said the need for reform keeps being raised but that no concrete regulatory action is known yet. The scope and timing of reform, together with the severity of expense rules, could affect dividend capacity and new-business strategy at the same time. Until the policy direction is fixed, pinpointing a dividend restart date remains difficult.

Treasury share handling and governance uncertainty

Hanwha Life holds treasury shares equal to 13.49% of common stock, about 117.16 million shares, but has yet to announce a specific plan for them.

The third amendment to the Commercial Act, promulgated and effective on March 6, 2026, requires newly acquired treasury shares to be cancelled within one year and pre-existing holdings to be resolved within 18 months.

The company said it is reviewing options including cancellation, taking financial conditions and market environment into account. Market interpretations differ over whether the delay reflects solvency constraints or the possibility of using the shares in a group governance reorganization.

What to watch next

November 2026
Third-quarter results and the earnings call. Key items are whether the insurance and investment profit improvement seen in the first half continues, whether the company is on track for its target of at least KRW 500 billion in annual pretax insurance profit, and whether the preliminary quarterly K-ICS ratio holds above the 165% goal.
Fourth quarter 2026
Signing of the definitive agreement for Acuon Capital and Acuon Savings Bank along with the final price and financing structure, followed by the regulatory major-shareholder change approval process. The share taken by financial investors and the final deal structure will determine the required-capital burden.
4Q 2026 to 1Q 2027
Whether regulators finalize the surrender-value reserve reform. Whether mass-lapse assumptions are adjusted toward roughly 25% for protection and 35% for savings products is the gateway to restoring distributable profit, and any accompanying rules on acquisition expenses should also be tracked.
Around February 2027
Full-year 2026 results. This will show whether the company met its year-end targets of K-ICS above 165% and a core-capital ratio above 60%, and whether dividends, suspended for two consecutive years, resume along with the direction of dividend policy.
First half of 2027 through September
Whether a plan for the 13.49% treasury stake is disclosed. Under the amended Commercial Act, pre-existing holdings must be resolved within 18 months, so the cancellation or disposal decision and its capital-ratio impact are the items to watch, alongside the outcome of the core-capital ratio rule taking effect in the same period.

Overall view

The recent direction of Hanwha Life's earnings is clear.

After bottoming at KRW 23.2 billion of owner net profit in 4Q25, the figure recovered to KRW 324.4 billion in 1Q26 and KRW 447.6 billion in 2Q26, and the four most recent quarters sum to KRW 1,062.1 billion, far above the KRW 641.3 billion recorded for full-year 2025.

Management pointed to simultaneous improvement in insurance and investment results and the largest first-half new-business CSM since IFRS17 adoption, while the K-ICS ratio rose 9.5 percentage points from end-2025 to 167.0% at end-June. On the other side sit structural constraints.

A surrender-value reserve balance of KRW 7.30 trillion at end-June is locking up dividend resources, the core-capital K-ICS ratio had fallen to 58.09% at end-2025 ahead of the 2027 rule, and the Acuon acquisition, discussed at around KRW 1 trillion, brings portfolio expansion and capital burden together.

In short, the recovery in earnings power is a fact confirmed by reported figures, while capital, dividends and the deal structure remain unsettled variables.

The evidence base will build in sequence: third-quarter results, confirmation of regulatory reform, finalization of the acquisition structure, and delivery on year-end capital targets. This report is for information purposes and contains no buy or sell recommendation.

Sources

Korea Exchange (KRX) — Prices · Market Cap · Volume
FSS electronic disclosure system (DART) — Financial statements · Dividend filings

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Report written 2026-09-05 · Data as of 2026-09-04

This content is AI analysis of market data and web search results, provided for information only. It is not a solicitation or recommendation to invest. Investment decisions and their consequences are the investor's own responsibility. Data may be delayed or contain errors.