The South Korea Financial Supervisory Service published end-June 2025 data on insurers’ capital adequacy under the Korean Insurance Capital Standard (K-ICS), where the ratio is calculated as available capital divided by required capital. With transitional measures applied, the aggregate K-ICS ratio increased to 206.8%, up 8.9 percentage points from three months earlier, with life insurers at 200.9% and nonlife insurers at 214.7%. Without transitional measures, the sector K-ICS ratio stood at 192.1%, up 8.0 percentage points over the quarter, with life insurers at 181.1% and nonlife insurers at 207.6%. Available capital (with transitional measures) rose to KRW 260.6 trillion, up KRW 11.3 trillion, reflecting net earnings of KRW 3.9 trillion, higher accumulated other comprehensive income of KRW 3.4 trillion linked to higher market interest rates, and KRW 2.6 trillion of new capital securities issuance. Required capital (with transitional measures) was KRW 126.0 trillion, up KRW 0.06 trillion, as lapse risk increased by KRW 2.5 trillion while interest rate risk declined by KRW 2.0 trillion. Against an expected easing cycle, the FSS indicated it will closely monitor insurers’ asset-liability management positions and guide vulnerable firms to strengthen risk management.
South Korea Financial Supervisory Service 2025-09-18
South Korea Financial Supervisory Service reports insurers’ K-ICS capital ratios rose to 206.8% at end-June 2025
The South Korea Financial Supervisory Service reported an increase in insurers' capital adequacy under the Korean Insurance Capital Standard (K-ICS) to 206.8% with transitional measures, and 192.1% without, as of June 2025. Available capital rose to KRW 260.6 trillion, driven by net earnings, higher comprehensive income, and new capital securities issuance. The FSS plans to monitor insurers' asset-liability management amid an anticipated easing cycle and guide firms to improve risk management.