[Edaily Reporter PARK JONG-HWA ] LotteNon-LifeInsurance has successfully returned to profitability based on its insurance sales performance.

Lotte General Insurance announced on the 14th that it posted an operating profit of 3.1 billion won and a net profit of 1.3 billion won in the second quarter of this year. Although the company posted a net loss of 19.8 billion won in the first quarter, it successfully returned to profitability in the second quarter.

Lotte General Insurance’s underwriting profit for the quarter was 26.5 billion won, driving the improvement in performance. In particular, gross premiums for long-term protection insurance—the company’s core product—totaled 638.6 billion won, an increase of over 10 billion won compared to a year ago (628.5 billion won). As of the end of the second quarter, the contract service margin (CSM) stood at 2.2431 trillion won.

The investment operations segment posted a loss of 23.5 billion won. This was due to larger valuation losses on interest-bearing assets as interest rates have recently risen. Lotte General Insurance explained, “These temporary valuation losses will be recovered once conditions improve, such as when market interest rates stabilize.”

Improvements in financial soundness are also an encouraging development for Lotte General Insurance. The company’s provisional core capital increased by 259.8 billion won, rising from a negative (-) 350.9 billion won in the first quarter to -91.0 billion won in the second quarter. Net assets also rose from 704.7 billion won to 993.5 billion won. Consequently, the K-ICS ratio (solvency ratio), which indicates the insurer’s financial soundness, improved from -21.4% to -5.4%.

A Lotte General Insurance official stated, “Despite regulatory changes and an unfavorable market environment, we have maintained stable underwriting profits and improved our core capital and net assets,” adding, “Building on these stable underwriting profits, we will continue to strengthen our business foundation with a focus on improving capital adequacy.”