Carrot, Korea's first digital insurer, sold to its parent at a loss after 6 red years

Carrot General Insurance was South Korea's first internet-only general insurer, launched by Hanwha General Insurance

That South Koreans would buy insurance directly online — pay-per-mile auto cover priced on actual driving, with no agents

Hanwha General paid ₩205.6 billion ($144.4 million) for 25.86 million shares to reach 98.3% ownership; investors had injected capital across rounds, Affirma buying in 2022 at about ₩15,000 a share

Hanwha General Insurance launched Carrot in May 2019 as Korea's first internet-only general insurer, drawing attention and outside investors including Hyundai Motor and Tmap Mobility with its signature pay-per-mile auto insurance.

The digital-first model never escaped the red: net losses for six consecutive years, peaking at ₩84 billion in 2022 and still ₩66.2 billion in 2024, with accumulated losses estimated around ₩330 billion. Financial soundness eroded — the K-ICS ratio fell from 656% in 2022 to 156% a year later, barely above the 150% level regulators recommend. In April 2025, Hanwha said it was considering options for Carrot excluding a sale; investors exited at an average of about ₩8,000 a share.

Hanwha General acquired 25.86 million shares for ₩205.6 billion ($144.4 million), lifting its stake to 98.3% — widely read as the prelude to a full merger. Several investors, including Affirma Capital, sold at a loss; Hanwha itself is believed to have taken a hit on cumulative capital injections.

Digital-only distribution trapped Carrot in short-term, low-premium products with thin margins, cut off from the long-term guarantee products that drive insurer profits.

Korean consumers still buy insurance through agents: 0.6% of life and 6.2% of general insurance was purchased online as of 2024.

Sluggish demand from younger generations — the core target market for digital insurers — slowed the ramp its capital plan assumed.

In insurance, distribution is the product: a digital-only insurer locked out of long-term guarantee products ends up selling only the thinnest margins in the market.

Hanwha General's buyout to 98.3% is seen as a precursor to a full merger, with the deal framed inside Hanwha as carrying Carrot's 'unique strategy' into the parent's digital ambitions. Industry officials cautioned against calling it a total failure, arguing digital insurance adoption in Korea is rising 'gradually but steadily' — but Carrot's quiet exit stands as the alarm bell for Korea's remaining digital insurers, all of which survive on repeated parent-capital injections.