Will Insurance Fraud Penalties Be Strengthened? ... National Assembly Forum on Amendments to the Insurance Fraud Prevention Act Held

[Asia Economy Reporter Changhwan Lee] A forum was held with lawmakers from both ruling and opposition parties and industry experts to discuss strengthening penalties for insurance fraud, which has significantly increased in recent years and become a social issue.

On the 14th at 10 a.m., Yoon Kwan-seok, a member of the Democratic Party of Korea, announced that he co-hosted the "Discussion on the Direction of Amendments to the Special Act on the Prevention of Insurance Fraud to Eradicate Insurance Fraud" at the National Assembly Members' Office Building Seminar Room 2, together with lawmakers Yoon Chang-hyun, Hong Sung-guk, and Park Soo-young.

Investigative agencies, supervisory authorities, academia, civic groups, and the insurance industry participated to discuss ways to enhance the effectiveness of the Special Act on the Prevention of Insurance Fraud.

The chair of the forum was Professor Choi Byung-gyu from Konkuk University’s Department of Law, and Research Fellow Hwang Hyun-ah from the Korea Insurance Research Institute presented on the topic "Current Status of Insurance Fraud and Desirable Directions for Amendments to the Special Act on the Prevention of Insurance Fraud."

Research Fellow Hwang proposed countermeasures including the introduction of a data provision request right, strengthening penalties for insurance industry workers, establishing a right to recover insurance payments, and sanctioning inducement, mediation, and solicitation acts related to insurance fraud to eradicate insurance fraud.

The amendment bill proposed earlier this year by Lawmaker Yoon Kwan-seok includes provisions for the Commissioner of the National Police Agency to establish a government joint task force on insurance crimes in cooperation with related agencies, and to establish and operate an insurance fraud prevention fund to secure resources necessary for investigating and preventing insurance fraud.

Co-host Lawmaker Yoon Chang-hyun proposed an amendment bill focusing on imposing heavier penalties on insurance fraud committed by insurance industry workers such as insurance planners and medical personnel who incite the general public to commit insurance fraud.

Lawmaker Hong Sung-guk has proposed introducing a data provision request right for the Financial Services Commission regarding public insurance such as health insurance to strengthen the response capability against complex insurance fraud involving public and private sectors.

Lawmaker Yoon Kwan-seok stated, “Since the enactment of the Special Act on the Prevention of Insurance Fraud in 2016, insurance fraud has increased by more than 32%, raising doubts about the effectiveness of the special law, yet no amendments have been made in the six years since its introduction. Organized and intelligent insurance fraud, such as organized intentional traffic accident insurance fraud recruiting accomplices via SNS, is becoming rampant. To eradicate such insurance fraud, comprehensive efforts from related agencies are necessary.”