Refund of 1.3 Billion KRW in Car Insurance Premiums Increased Due to Insurance Fraud Over One Year... 33% Increase Compared to Previous Year

Refund Possible Without Application
Direct Inquiry Needed If Contact Information Has Changed

Four insurance fraudsters, including A, received insurance money of 34.17 million KRW from B's insurance company by deliberately colliding with B's vehicle, which was changing lanes in the Gyeonggi-do area, after boarding the same vehicle. The court sentenced the four insurance fraudsters, including A, to imprisonment for violating the Special Act on the Prevention of Insurance Fraud. The insurance company refunded 4.53 million KRW in unfairly increased premiums for five automobile insurance contracts concluded by policyholder B after the insurance fraud damage.

About 1.3 billion KRW of unfairly borne increased premiums due to automobile insurance fraud damage were refunded over the past year.

On the 18th, the Financial Supervisory Service announced that, together with the Korea Insurance Development Institute and non-life insurance companies, it refunded 1.28 billion KRW in increased premiums to 2,633 automobile insurance fraud victims from October last year to September this year. This is an increase of 33.3% (320 million KRW) compared to the same period last year. The number of refunded individuals and contracts also increased by 16.3% and 16.5%, respectively, compared to the same period last year.

By company, the 'Big 4' insurers with high automobile insurance market shares?Samsung Fire & Marine Insurance, DB Insurance, Hyundai Marine & Fire Insurance, and KB Insurance?accounted for 1.18 billion KRW in refunded premiums, representing 92.1% of the total.

Previously, the Financial Supervisory Service has been operating an automatic refund system for unfairly increased premiums since May 2009. When a non-life insurance company confirms insurance fraud damage information through insurance fraud court rulings and other documents and sends related data to the Korea Insurance Development Institute, the institute notifies all insurers that concluded automobile insurance contracts with the fraud victims after the related accidents about the refund targets and details. Even without a separate application from the victim, the insurance company contacts them and refunds the increased premiums. Since the introduction of this system, about 18,000 people have been refunded approximately 8.01 billion KRW as of last September.

A Financial Supervisory Service official explained, "Although refunds are made automatically once automobile insurance fraud damage is confirmed, if the victim's contact information changes, it can be difficult to notify them about the increased premium refund." They added, "The Korea Insurance Development Institute operates the 'Overpaid Premium Integrated Inquiry System' so that consumers can directly verify insurance fraud damage and receive refunds for increased premiums, so please refer to it."