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| Financial Supervisory Service (FSS) Governor Lee Bok-hyun, front row center, stands with CEOs of insurance companies at Center Point Gwanghwamun in central Seoul, Thursday. Courtesy of FSS |
By Anna J. Park
Financial Supervisory Service (FSS) Governor Lee Bok-hyun urged CEOs of local insurance companies to pay extra attention to risk management and market stability, while refraining from overexpansion.
During the meeting with CEOs of 14 insurance companies on Thursday morning in central Seoul, Lee stressed insurance companies' role in stabilizing financial markets.
"The insurance sector has played a key role in stabilizing the capital market by supplying long-term liquidity, whenever financial markets experience unstable phases," he said. "I hope insurers will continue to fully assume their role of supplying liquidity through purchasing diverse investment products ― like bonds ― as institutional investors so that an insolvency in one company would not spark a systemic risk within the financial industry."
Attendees of the meeting are 14 chiefs from major life insurers of the country ― Samsung Life, Hanwha Life, Kyobo Life, NongHyup Life, Shinhan Life, Mirae Asset Life and KB Life ― as well as major non-life insurance companies, including Samsung Fire & Marine Insurance, Hyundai Marine & Fire, DB Insurance, KB Insurance, Seoul Guarantee Insurance and Korean Reinsurance Company.
Lee also asked the insurance leaders to respond preemptively to latent market risks, so as to avoid any risks stemming from IFRS17's implementation in the country.
IFRS17 is a set of new accounting standards aimed to increase transparency for insurance contracts, set to be introduced here in the near future.
"It seems necessary to strengthen evaluations on insurance firms' loans to real estate project financing or overseas alternative investments," Lee stressed, vowing that the financial authorities will also share information about real estate project financing markets.
