'Massive Crackdown on Insurance Companies and GA Agents for False Traffic Accidents and Diagnoses'

FSS Suspends Many Agents for Fraudulent Insurance Claims Using Fake Medical Certificates
Agent Who Embezzled Tens of Millions in Traffic Accident Insurance Money Faces 'License Cancellation'
Insurance Fraud Scale Growing... Last Year's Detected Amount Reaches 1.1164 Trillion Won

The Financial Supervisory Service (FSS) has imposed sanctions on numerous insurance agents affiliated with insurance companies and General Agencies (GAs) who fraudulently claimed insurance payouts ranging from several million to tens of millions of won through false traffic accidents and fake medical diagnoses.

According to the FSS on the 10th, the Insurance Fraud Response Team notified sanctions such as license cancellations and business suspensions against agents affiliated with major insurers including Samsung Life Insurance, Samsung Fire & Marine Insurance, DB Insurance, Hanwha General Insurance, Shinhan Life Insurance, as well as agents from GAs such as Prime Asset and Aplus Asset.

The Insurance Fraud Response Team uncovered violations of the 'Obligation to Prohibit Involvement in Insurance Fraud' under the current Insurance Business Act, where insurance industry workers fraudulently received insurance payouts. An insurance agent A affiliated with Samsung Life Insurance conspired with eight others to deliberately cause a traffic accident and fabricated the incident as a legitimate accident, thereby fraudulently obtaining 27.6 million won in insurance payouts from another insurer. The FSS revoked this agent’s registration.

The FSS also notified license cancellations to two insurance agents affiliated with Samsung Fire & Marine Insurance. Agent B of Samsung Fire & Marine Insurance falsely reported an accident, claiming a collision between the Avante vehicle they were driving and another vehicle, after conspiring when their child’s friend crashed a Mercedes-Benz into a guardrail. This deception led to the fraudulent receipt of 50.16 million won in insurance payouts from another insurer.

Another agent C from the same company subscribed to six insurance policies from four insurers, then arranged for a third party to be diagnosed with a coccyx fracture. Agent C fabricated that they had undergone treatment for over a month, fraudulently obtaining 10.21 million won, resulting in license cancellation by the FSS. Additionally, agents affiliated with DB Insurance, Hanwha General Insurance, and Shinhan Life Insurance received business suspension sanctions for frauds such as hole-in-one insurance scams and false hospitalization treatments.

Agents affiliated with GAs who fabricated documents to fraudulently claim insurance premiums were also extensively caught by the Insurance Fraud Response Team. Over 20 entities including Aplus Asset Advisor, GA Korea, People Life, Prime Asset, C&H Asset, and KG Asset were identified. Investigations confirmed that many sanctioned agents submitted false admission and discharge certificates with fabricated diagnoses to fraudulently claim insurance payouts from other insurers.

Recently, based on information received at the 'Insurance Fraud Reporting Center,' the FSS cooperated with the Busan Metropolitan Police Agency to arrest 103 members of an organized insurance fraud ring that fraudulently claimed over 1 billion won in actual expense insurance payouts using false medical records. The ring involved hospital directors, nurses, hospital staff, and five insurance agents, with about 100 fake patients implicated in the insurance fraud.

Meanwhile, the scale of insurance fraud continues to grow. Last year, the amount detected in insurance fraud cases was 1.1164 trillion won, and the number of detected individuals was 109,522, representing increases of 34.6 billion won (3.2%) and 6,843 people (6.7%) respectively compared to the previous year. Among insurance types, automobile insurance fraud increased significantly, and among fraud types, false accidents and intentional accidents rose. An FSS official stated, "Insurance fraud is conducted secretly and systematically, so insider tips are crucial for detection," adding, "We urge active reporting when receiving proposals that defy common sense and when concrete evidence is available."