Photo = Yonhap news

 

[Alpha Biz= Paul Lee] To break the cycle of rising auto insurance premiums caused by fraudulent claims, the Ministry of Land, Infrastructure and Transport, the Financial Services Commission, and the Financial Supervisory Service jointly announced an Auto Insurance Fraud Prevention Plan on the 26th.


The government estimates that once the plan is implemented, individual auto insurance premiums could decrease by up to 3%.


Under the new measures, insurance companies will no longer provide future medical expenses for minor injury patients classified under grades 12 to 14. These expenses will now be limited to patients with moderate to severe injuries (grades 1 to 11). Future medical expenses refer to additional treatment costs that might arise after initial treatment has concluded, typically paid as part of settlement agreements.

Previously, insurers routinely paid these expenses to both minor and severe injury patients to expedite settlements. In 2023 alone, future medical expenses amounted to KRW 17 trillion, with minor injury patients receiving KRW 14 trillion—accounting for 82% of the total.

 

 

 

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