Hospitalized at the slightest fall... Seven family members caught for claiming 1.1 billion won in insurance through fake and excessive hospitalization treatments

Busan Police Agency.

[Asia Economy Yeongnam Reporting Headquarters Reporter Kim Yong-woo] A family of seven who collected insurance payouts totaling around 1.1 billion KRW by first subscribing to dozens of insurance policies and then getting hospitalized whenever they fell down were eventually caught by the police.

On the 9th, the Busan Metropolitan Police Agency announced that they arrested seven family members, including an insurance planner, who had taken out 91 insurance policies and inflated injuries and illnesses to get hospitalized, receiving about 1.18 billion KRW in insurance payouts. Two of them were detained.

According to the police, from August 2012 to March last year, the family concealed their medical history and focused on subscribing to insurance policies, then pretended to have accidents or illnesses or got hospitalized without outpatient treatment even for minor injuries or illnesses.

They are suspected of repeatedly getting hospitalized a total of 244 times by moving among 37 small- and medium-sized hospitals in the Busan and Yangsan areas where hospitalization is easy, thereby collecting insurance payouts worth approximately 1.18 billion KRW.

Suspects A and B, who are in a common-law marriage, have worked as insurance planners for an insurance company since 2004 and learned about insurance products that pay overlapping high insurance benefits such as daily hospitalization allowances and surgery fees, as well as types of injuries and illnesses that allow easy payout of insurance money.

The couple paid about 2 million KRW monthly in premiums under their own names as well as those of their minor children, focusing on subscribing to a total of 91 protection-type insurance policies.

They submitted false information regarding the "pre-contract notification obligations" to the insurance companies during the subscription process and even subscribed to additional insurance policies while receiving hospital inpatient treatment.

The family mostly got hospitalized for illnesses that were difficult to diagnose and for which the accident circumstances were unclear, and they were admitted only for the number of days that insurance payouts were provided, then discharged and readmitted to claim insurance money.

The police stated that insurance fraud worsens the financial condition of insurance companies and leads to premium increases, causing losses to many policyholders, and they urged public attention and reporting of such crimes.