Instant messaging app Kakao has teamed up with Samsung Fire & Marine Insurance (SFMI) to launch a new digital insurance company in South Korea.

The collaboration with SFMI also marks Kakao’s foray into the insurance sector.

Both the partners are planning to submit a preliminary application with the South Korean Financial Services Commission (FSC) by the end of this year.

Upon securing the regulatory nod, the partners will introduce a new internet-only non-life insurer by the middle of the next year, local media reports suggest.

A digital insurer is an insurance entity which provides insurance products and services through computers and smartphones only.

Kakao and its mobile payment unit Kakao Pay will own the largest stake in the digital insurer whereas Samsung Fire will act as the strategic investor.

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By GlobalData

The digital insurer will mainly focus on offering travellers, pets, and shared vehicle users insurance through Kakao’s messenger platform.

Recently, Kakao Pay launched its own simplified insurance services. The messaging platform forayed into banking sector in 2017 by launching digital-only lender, Kakao Bank.

Hanwha General Insurance, Hyundai Motor and SK Telecom launched the first online insurance company in South Korea earlier this month.

Known as Carrot General Insurance, the company offers car insurance for young drivers that rewards safe driving habits.