"Insurance Payouts Vary by Cataract Surgery Method... Check Policy Terms"

FSS Provides Precautions Related to Life Insurance

Mr. Kim underwent cataract lens extracapsular surgery in August 2019 for secondary cataract treatment and additionally received YAG laser posterior capsulotomy in July last year. Subsequently, he received type 2 and type 1 surgical insurance benefits from the insurance company, respectively. Mr. Kim raised an objection, claiming it was unfair to receive the lower type 1 surgical benefit for the YAG laser posterior capsulotomy. However, the Financial Supervisory Service explained that insurance payouts may vary depending on the type of surgery according to the insurance policy.

The financial authorities have urged caution when subscribing to life insurance and filing insurance claims. Notably, cataract-related surgeries pay different surgical insurance benefits depending on the surgical method. In the case of cancer insurance, the payout reference date is not the date the diagnosis certificate is issued but the date the biopsy report results are recorded.

On the 12th, the Financial Supervisory Service analyzed and provided guidance on frequently recurring types of life insurance disputes this year. First, for cataract surgery, insurance payouts may differ depending on the surgical method. According to the insurance policy, cataract lens extracapsular surgery is classified as a type 2 surgery, whereas YAG laser posterior capsulotomy is classified as type 1, as it is a laser eye surgery. Type 1 surgical benefits are the lowest, and type 5 are the highest.

If a medical history is not recorded on the application form when subscribing to insurance but only verbally disclosed to the insurance agent, the insurance contract may be canceled for breach of pre-contractual disclosure obligations, and insurance benefits may not be paid. While liability for nondisclosure may rest with the insurer, it is better to truthfully record facts on the application form to avoid cumbersome litigation.

Attention should also be paid to the reference date for receiving cancer diagnosis insurance benefits. The confirmed cancer diagnosis date is not the date the diagnosis certificate is issued. The reference date is the result reporting date recorded on the biopsy report. Insurance benefits can only be paid if the biopsy result reporting date is after the cancer coverage start date. This has also been established in precedent (Seoul Western District Court 2002GaHap1543).

Dental insurance also requires caution. Prosthetic treatment insurance benefits cover only teeth extracted after the insurance subscription. Teeth extracted before subscribing to insurance are not eligible for benefits. Additionally, prosthetic treatment insurance benefits are paid within the annual limits specified in the insurance policy.

It is also necessary to check the death benefit payment period for pension insurance. Before the pension starts, death benefits can be received upon death, but after pension payments begin, death benefits cannot be received unless a separate rider is subscribed. However, even if death occurs after pension commencement, the insurer must pay the pension amount for the guaranteed period (minimum 5 years) as stipulated in the policy.