financial accounting(1201) 2-_#444.pptx;_#1020

FINANCIAL ACCOUNTING

INSURANCE COMPANY

2008111347 WANG HOLIM

[ CONTENTS ]

INTRODUCTION

CHOICE OF COMPANIES

ANALYSIS

CHOOSING THE BEST CO.

CONCLUSION

INTRODUCTION

INSURANCE COMPANY ?

INTRO CHOICE ANALYSIS CONCLUSIONBEST CO.

- Life Insurance

Pay the benefits upon the death of

the insured person

- Property Insurance

Protection against most risks to property


PROPERTY INSURANCE VS.

LIFE INSURANCE


PROPERTY INSURANCE VS.

LIFE INSURANCE

출처 : 금융감독원 (보험회사업무자료)

CHOICE OF THE COMPANIES


< TOP 3 COMPANIES >


Market share (Assets)

Samsung

Kyobo

Daehan

ING

Shinhan

Others

65.6%

Market

Share

These three companies accounted for 65.6% of total market share.

ANALYSIS


THE RECENT TREND OF INSURANCE

INDUSTRY

Growth : decreased growth rate because of financial crisis

Profitability : FY08 Financial crisis → Net income ↓

Financial quality : Weak small companies’ financial quality

Competition : Big 3 companies’ market shares ↓

Small companies’ and foreign companies’

market shares are continuously↑


The largest insurance company in Korea

Dongbang Life insurance company in 1957

Assets : 145 trillion won in 2011 (\ 145,000,000,000,000)

Target : private customer and institution

Insurance

Loan

Investment – funds

Pensions

Established

Services

May, 1957

Insurance to

pension


Key accounts of

Samsung LIFE Insurance

FY2010FY2009


The first insurance company in Korea

Bankrupt in 1969, and acquired by Shindonga

Built 63 building in 1985

Acquired by Hanhwa group in 1997

Established Sep, 9, 1946


Key accounts of

Daehan LIFE Insurance

41,304

61,602

FY2009

FY2010

Stockholders

’

Equity


Founded in 1958 / Korean Education Insurance

Promotion of education and

formation of national capital

The first education insurance

13 different subsidiaries


Key accounts of

Kyobo LIFE Insurance

FY2007 FY2008 FY2009 FY2010

Net profit margin

2007~2010 Growing flawlessly

CHOOSING THE BEST COMPANY


1. Return on equity (ROE) =

Net Income / Book value of shareholders’ Equity

Choosing “The Best Company”

2. Earnings per share (EPS) =

Net income / Number of common stock shares outstanding

3. Net profit margin = net income/revenues

4. Return on Invested Assets = [Investment Profit / {(Invested Asset

during the term+ Invested Asset during last term - Investment Profit)/2}]

5. Debt/equity ratio = Total Liabilities/shareholders Equity

6. Required Solvency Margin Ratio =

Prepared Solvency/Required Solvency

ROE

EPS

Net profit margin

Return on

Investment Assets

Debt/Equity Ratio

Required Solvency


1st : 3 points / 2nd : 2 points

3rd : 1 points

① High level of growth

② High level of Required Solvency

SCORE

Extra

Points

(1 point)

We compared each of the six areas

And gave Extra Points

Evaluation Method

1. Return On Equity


1. Return on Equity (ROE)

Kyobo

Samsung

(unit : Percentage, %)

Daehan

12.5%

7.7%

15.1%

7.5%

9.2%

19.31%

FY2009 FY2010

Kybo showed the highest


FY2010FY2009

12.5%

7.5%

We gave them one extra point for large amount of growth

67%

Growth !

↓

Extra

Point !

1. Return on Equity (ROE)

2. Earnings Per Share


DaehanKyoboSamsung

FY2010

(Unit : Won)

FY2009

2. Earning per share (EPS)

5,000

10,000

20,000

30,000

12 3

Daehan is 3rd in EPS session.

But, how about the amount of

Growth?


FY2010FY2009

9,295

2,638

We gave them one extra point for large amount of growth

352%

Growth !

↓

Extra

Point !

2. Earning per share (EPS)

3. Net Profit Margin


3. Net profit margin

3.5%

7.35%

4.24%5.54%

2.8%

0 42 6 8

3.9%

(%)

FY2009

FY2010

1

2

3

210% growth in 1 year !

How they can do that?


3. Net profit margin

The reason is..

Profit-driven policies of the product

portfolio

Principal repayments

Make

High

Performance

4. Return On Invested Assets


4. Return on Invested Assets

Kyobo

Samsung

Daehan

6.38%

5.83%5.79%

5.2%

5.86%5.59%

FY2009 FY2010

(unit : Percentage, %)

There is no big difference between

each company.

.1 2 3

5. Debt to Equity Ratio


5. Debt / Equity Ratio

0

996.6%

1301.9%

851.1%

1259.9%1268.3%

936.1%

FY2009

FY2010

1,000%

200

400

600

800

1,200


FY2010

50.3%

851.0%

Samsung Life Insurance Liabilities 16 times higher than the

Samsung electronics.

삼성전자




120,912,253,000,000

÷ 12,132,820,000,000

×100 = 996.6%

Why these companies' debt equity

ratio is so high?



Because of..Insurance Company

Many

insurance

contracts

Unearned Revenue

(Liabilities) Increase!

6. Required Solvency Margin Ratio


6. Required Solvency Margin Ratio

FY2009

FY2010

0

332.79%

261,71%

380.13%

224.72%

299.1%

267.24%300

100

200

400

%

CONCLUSION


ROE (%)(+1 for high growth)

Net profit

margin(+1 for high growth)

Cash

reserve ratio(+1 for high level)

1st

(3 points)

2nd

(2 points)

3rd

(1 points)

Return on

invested

assets

EPS(+1 for high growth)

+1

+1

+1

+1 +1

Let’s check the score!


The score is..

16 Points

10 Points

9Points

Got the highest score !


Is the best insurance company !

Dart System http://dart.fss.or.kr/

통계청 http://www.index.go.kr/egams/stts/jsp/potal/st

생명보험협회 http://www.klia.or.kr/

삼성생명 http://www.samsunglife.com/

삼성생명 관련 기사

http://www.etoday.co.kr/news/section/newsview.php?TM=news&SM=0202&idxno=377271

http://www.asiae.co.kr/news/view.htm?idxno=2010111515090164284

교보생명 http://kyobo.co.kr/

대한생명 http://www.korealife.com/

대한생명 관련 기사

http://www.newspim.com/view.jsp?newsId=20101110000124

http://www.sisaseoul.com/news/articleView.html?idxno=26231

ING생명 http://www.inglife.co.kr/

ING생명 관련 기사

http://www.fnnews.com/view?ra=Sent0701m_View&corp=fnnews&arcid=101117145959&cDateYear=2010&cDate

Month=11&cDateDay=17

신한생명 http://shinhanlife.co.kr/

Reference

http://dart.fss.or.kr/

http://www.index.go.kr/egams/stts/jsp/potal/st

http://www.klia.or.kr/

http://www.samsunglife.com/




http://kyobo.co.kr/

http://www.korealife.com/

http://www.newspim.com/view.jsp?newsId=20101110000124

http://www.sisaseoul.com/news/articleView.html?idxno=26231

http://www.inglife.co.kr/

http://www.fnnews.com/view?ra=Sent0701m_View&corp=fnnews&arcid=101117145959&cDateYear=2010&cDateMonth=11&cDateDay=17

http://www.fnnews.com/view?ra=Sent0701m_View&corp=fnnews&arcid=101117145959&cDateYear=2010&cDateMonth=11&cDateDay=17

http://shinhanlife.co.kr/

THANK YOU

financial accounting(1201) 2-_#444.pptx;_#1020

Economy & Finance