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| Meritz Fire & Marine Insurance headquarters in southern Seoul / Courtesy of Meritz Fire & Marine Insurance |
By Anna J. Park
Meritz Fire & Marine Insurance celebrated its 100th anniversary on Oct. 1. Often dubbed the icon of innovation in the local insurance market, the company has undergone continual transformation and renovation to thrive as a successful company throughout the past century.
Established in 1922 as Chosun Fire & Marine Insurance, the company's growth trajectory represents the local insurance industry's history itself. It was Korea's very first indemnity insurance company based on Korean people's capital, operating among various other Japanese insurers in Korea back then. After Japan's 35-year colonial rule over the peninsula ended in 1945, the company became state-owned, and it was renamed Dongyang Fire & Marine Insurance in 1950.
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| Chosun Fire & Marine Insurance headquarters in Seoul in 1922 / Courtesy of Meritz Fire & Marine Insurance |
It was also the country's first insurance company to go public on the local stock market in 1956 and the 60th company to be listed. In 1959, the company became privately owned again, as it was acquired by local businesses. It was incorporated into Hanjin Group in 1967, and later broke off from the group in 2005 with its current name, Meritz Fire & Marine Insurance. Its name reflects its vision: to put customer value as the first priority and focus on returning more "merits" to customers.
As of 2005, the company's entire asset size stood at 2.7 trillion won ($1.87 billion), with a market cap of 170 billion won. Since then, it has gone through a series of phases of innovative corporate restructuring, rising as a role model of innovation in the conservative insurance industry. These efforts have led to its exponential growth during the past two decades. Its asset size stands at 28 trillion won with a market cap of 4.5 trillion won as of this year. The annual net profit posted a 25-fold increase from 26.4 billion won in 2005 to 660 billion won in 2021.
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Chairman Cho Jung-ho's leadership prioritizing performance-based meritocracy is estimated to be the key driving force of the company's quantum growth over the past two decades. Since taking the helm of Meritz Financial Group in 2002, which includes both Meritz Fire and Meritz Securities, Cho has focused on maximizing employee autonomy, efficiency and compensation, as the core of the group's corporate system.
Today, Meritz Fire & Marine Insurance continues its impressive growth. During the past six years, the company's return on equity (ROE) has more than doubled to 24.7 percent in 2021, from 11.9 percent in 2015. It has demonstrated excellent performance in terms of profitability, given that most of its competitors post only a single-digit ROE.
Its shareholder return policy is also unparalleled. While other local insurers have focused on paying out dividends, the company retired its own stocks worth 180 billion won to increase shareholder value in June and August this year, while repurchasing its own stocks worth 380 billion won during the past two years. These moves have increased the earnings per share (EPS) by reducing the entire number of stocks available on the market.
