Samsung Fire & Marine Insurance has reportedly reduced its long-term insurance claims organization and has transferred some of its tasks to its subsidiary, Samsung Fire & Marine Service. This is interpreted as a measure to relocate the long-term insurance claims organization, which has a relatively high labor cost burden due to declining profitability, and to increase cost efficiency.
According to the insurance industry on the 9th, Samsung Fire & Marine Insurance is transferring tasks to Samsung Fire & Marine Service in order to reduce the number of personnel in the long-term insurance claims team. The exact scale of the personnel reduction has not been disclosed. It is expected that Samsung Fire & Marine Insurance will directly handle accident types where the appropriateness of claim payments is difficult to judge, while Samsung Fire & Marine Service will take on relatively easier cases.
Samsung Fire & Marine Service is a subsidiary that takes over part of the loss adjustment (evaluation of the appropriateness of claim payments) tasks of Samsung Fire & Marine Insurance. Long-term insurance refers to policies with a contract period of more than three years.
It is expected that more than 10 departments, including regional long-term compensation divisions, claims planning part, and claims operation part under the long-term insurance claims team, will be subject to personnel relocation. Some of the personnel from these departments will move to organizations with different tasks.
A representative from Samsung Fire & Marine Insurance stated, "As Fire Service is an organization with expertise in long-term compensation work, we have proceeded with the transfer of some tasks to improve efficiency in claims-related work and enhance subscriber satisfaction."
The insurance industry interprets that Samsung Fire & Marine Insurance has taken this measure in light of its declining revenue, aiming to cut expenses and improve workforce efficiency. Generally, loss adjustment departments are known to have a high proportion of labor costs. Since the net profit and loss of the insurance company varies depending on the results of the loss adjustment, it is necessary to hire specialized employees.
In the first quarter of this year, Samsung Fire & Marine Insurance reported a net profit of 609 billion won, a decrease of 13.2% compared to the same period last year. This marks a decline for the first time in three years, influenced by an increase in claim payments due to major disasters.
An insurance industry representative noted, "Loss adjustment work requires specialized personnel, which incurs significant expenses from employee training to organizational operation," adding, "For this reason, there is a trend among domestic and international insurance companies to outsource claims operations to achieve cost efficiency."