Life insurance association calls for increased tax benefits for private pensions

Chairman of the Korea Life Insurance Association (KLIA), Chung Hee-soo, stated at a press conference on Monday that the country’s tax authority should provide additional incentives for private pensions in light of the rapidly decreasing national pension and the rising elderly poverty rate.

“The national pension is the most popular means of retirement preparation, but its liquidity is rapidly depleting. “We cannot rely solely on it in this era of an ageing society,” Chung told reporters.

In order to prevent any social issues caused by an ageing population, he urged the nation’s tax agency to immediately increase the number of tax breaks for private pensions.

He stated, “Korea has the highest elderly poverty rate among OECD member states.” In order to rectify this disgrace, the taxing authority should consider offering tax breaks for private pensions.

In comparison to other developed nations, the poverty rate among senior citizens in Korea is significantly lower at 39.4%. Japan, the United Kingdom, and the United States had respective percentages of 23, 20, and 15.5%.

In addition, the head of the life insurance association presented three fundamental strategies for expanding the company’s function as a social safety net, ensuring the long-term viability of the industry, and regaining customer confidence.

Chung stated, “The unprecedented rapidity of the declining birthrate and ageing population causes a variety of economic and social issues.” As a social safety net that represented the public and cared for retirees’ lives, the life insurance industry has been indispensable.”

The association stated that it would collaborate with market leaders to aid in the expansion of their operations through digital innovation and senior care.

He stated, “The association will proactively respond to any shift in social trends and assist insurers in the development of relevant services.” In addition, we will make every effort to establish an institutional structure that will allow the society to simultaneously overcome crises and achieve growth.”