Half of Car Insurance Subscribers Use the Internet... "Lower Prices"

KIDI's Survey on '2023 Personal Auto Insurance Subscription Characteristics'

Last year, half of the individual car insurance policyholders used the internet to sign up.

On the 7th, the Korea Insurance Development Institute (KIDI) announced the results of its survey on the "Characteristics of Individual Car Insurance Subscriptions in 2023," revealing that the proportion of internet subscriptions increased by 2.9 percentage points from the previous year to 47%. Insurance premiums were on average 10.9% cheaper when subscribed online. The proportions of face-to-face and telephone subscriptions were 35.6% and 17.4%, respectively, showing a decreasing trend each year.

The subscription to premium discount riders is also on the rise. 84.5% of individual passenger cars subscribed to the mileage discount rider. Among them, 66.2% received an average refund of 129,000 KRW. The installation rate of advanced safety devices such as emergency braking, lane keeping, and warning systems was recorded at 35.2%. When these devices are installed, insurance companies offer discounts of up to 9.4%. The scope of discounts is gradually expanding to include devices such as Head-Up Displays (HUD) and blind spot collision warning systems.

The number of insurers offering UBI (Usage-based Insurance), which provides a 4-16% discount on premiums based on safe driving scores calculated using driving information from smartphone applications, plug-in devices, or connected cars, has increased to nine companies.

The number of policyholders eligible for preferred discount grades is also increasing. In the evaluation of discount and surcharge grades based on accidents, 88.3% of individual passenger cars received discount grades. The composition ratio of discount grades has been increasing annually, from 87.1% in 2021 to 87.9% in 2022.

The insured amounts are also becoming higher. 80.1% of individual passenger cars chose a property damage liability coverage limit of 300 million KRW or more. The subscription rate for collision coverage also increased to 78.9%, indicating a growing tendency to prepare for repair cost increases through insurance.

Heo Chang-eon, President of the Korea Insurance Development Institute, said, "Since there are significant differences in premiums among insurance companies depending on subscription conditions, it is important to carefully compare prices." He added, "By utilizing the internet and various discount riders, premiums can be reduced." Heo also stated, "Currently, the same premium is applied based on driver age, subscription history, and driver coverage, but in the future, premium differentiation based on actual risk factors such as driving habits will gradually expand. It is important to maintain safe driving habits regularly to prevent accidents and reduce premiums."