The size of Korea’s savings-type insurance market expanded more than 30 percent over the last two years, data showed Monday, as local insurers vied to sell such products that guarantee high commissions.

Savings-type insurance, which includes annuity insurance and variable annuity insurance, refers to a policy designed to safeguard retirement income or help boost financial assets for senior citizens rather than cover health care expenditures and other costs.

The savings-type insurance market in Asia’s fourth-largest economy totaled 42.4 trillion won ($38 billion) as of the end of fiscal 2010 that finished on March 31, growing 31 percent from two years ago, according to the data by the Financial Supervisory Service.

Non-life insurers led the increase with the sales of such policies more than doubling to 8.8 trillion won from 4.3 trillion won over the cited period, while the amount of policies sold by life insurers increased 19.6 percent to 33.6 trillion won, according to the data.

The sharp rise comes as insurers are beefing up efforts to sell savings-type insurance policies, which allow them to rake in bigger sales commissions compared with traditional insurance products.

In a bid to prevent heated competition from hurting the overall industry, the regulator said it plans to look into savings-type insurance sales via on-site inspections. 

(Yonhap News)