When Official Price is 200 Million KRW and Mortgage Loan is 100 Million KRW, 'Regional Health Insurance Fee' Drops from 95,460 KRW to 70,620 KRW

Reduced Burden for Primary Homeowner Occupants

Mr. A, a regional health insurance subscriber, is a non-homeowner living in a house with a deposit of 200 million KRW and a monthly rent of 500,000 KRW. Of the deposit, 180 million KRW is a jeonse (long-term deposit) loan. Currently, Mr. A pays 65,690 KRW per month in health insurance premiums based on property excluding income, but from September, this amount will be significantly reduced to 4,510 KRW.

Mr. B, also a regional health insurance subscriber, currently owns and resides in a single house valued at 300 million KRW market price and 200 million KRW official assessed price, with a mortgage loan of 100 million KRW. Currently, he is charged 95,460 KRW per month for health insurance premiums based on property, but going forward, he will receive a deduction of 50 million KRW from the mortgage loan, reducing his premium to 70,620 KRW per month, a decrease of about 25,000 KRW.

The 'Partial Amendment to the Enforcement Decree of the National Health Insurance Act,' passed at the Cabinet meeting on the 28th, was prepared with the intention of reducing the insurance premium burden on regional health insurance subscribers for housing finance debt related to their actual residence. Unlike workplace health insurance subscribers, regional subscribers currently have their health insurance premiums calculated and imposed annually based on scores assigned to both income and property by grade. However, complaints have been raised that even when actual income is absent or reduced, the premium burden increases due to rising housing prices.

Non-homeowners can receive deductions for debts related to the deposits of the jeonse or monthly rent housing they actually reside in. The deduction amount is up to 150 million KRW (loan principal of 500 million KRW) within the deposit range. In Mr. A’s case, currently, the property value is calculated as 56 million KRW after subtracting the basic deduction of 10 million KRW from the assessed property value of 66 million KRW, but from September, he will receive an additional deduction of 54 million KRW, which is 30% of the 180 million KRW debt, lowering the assessed property value to 2 million KRW.

The deduction amount is calculated based on the outstanding loan balance after subtracting the amount already repaid from the total loan amount, and it is updated annually in November to recalculate the premium according to the loan balance. Also, if the official assessed price of the target house at the time of application falls within the deduction target (500 million KRW or less), the deduction will continue even if the assessed price later rises above the standard. Currently, when calculating property insurance premiums, a basic deduction of 5 million KRW is applied for owned houses and 10 million KRW for rented houses. A Ministry of Health and Welfare official explained, "For one household with one house, a deduction cap is set so that owners of high-priced houses who have taken out large loans do not receive greater benefits. However, for one household without a house, debts can be deducted up to 150 million KRW within the total deposit amount without a cap."

Regional subscribers who wish to receive deductions for housing-related loans from their health insurance premiums must submit the necessary debt-related information or consent to information provision starting from the 1st of next month via the National Health Insurance Service website, mobile application, or by visiting a branch office. The submitted and verified housing finance debt deduction applications will be reflected in the September premiums and are expected to be billed around September 26.

Choi Jong-gyun, Director of the Health Insurance Policy Bureau at the Ministry of Health and Welfare, expressed hope, saying, "Along with the housing finance debt deduction system, the second phase of the health insurance premium assessment system reform to be implemented this September will further reduce the premium burden imposed on the property of regional subscribers."