South Korea insurers lift capital by $6b under K-ICS in December 2025

Available capital reached $190.3b at the end of December.

South Korean insurers' available capital under the Korean Insurance Capital Standard (K-ICS) rose by $6.2b (KRW9.3t) quarter on quarter to $190.3b (KRW284.0t). 

Insurers were supported by $603m (KRW0.9t) in net earnings and a $10.7b (KRW15.9t) increase in accumulated other comprehensive income during the October to December period, driven by stronger equity markets.

Insurers also recorded stronger capital adequacy ratios at the end of 2025 under the K-ICS, supported by higher earnings and gains from a stock market rally.

With transitional measures applied, insurers’ capital adequacy ratio stood at 212.3% at the end of December 2025, up 1.5 percentage points from 210.8% three months earlier. 

Life insurers posted a ratio of 205.8%, up 4.4 percentage points, whilst non-life insurers saw their ratio fall 2.2 percentage points to 221.9%.

Without transitional measures, the industry’s K-ICS ratio reached 197.6% at end-December, compared with 196.8% at the end of September. 

Life insurers’ ratio increased 3.7 percentage points to 186.7%, whilst non-life insurers’ ratio declined 2.4 percentage points to 214.6%.

Required capital under K-ICS also increased, rising $2.3b (KRW3.5t) to $89.6b (KRW133.8t) over the same period. 

Higher interest rates reduced disability and morbidity risk as well as interest rate risk by $1.9b (KRW2.9t) and $1.7b (KRW2.5t), respectively. 

However, equity risk increased by $6.2b (KRW9.3t) due to the stock market rally.

South Korea’s Financial Supervisory Service said it will continue monitoring insurers’ capital positions amidst rising uncertainty in financial markets linked to tensions in the Middle East. 

The regulator said it will urge insurers with weaker capital positions to secure high-quality capital and strengthen risk management.

($1.00 = KRW1,503.35)