Next Year’s Real Loss Insurance Premiums Rise 7.5%... 4th Generation Up 13%

Different Premium Increase Rates by Generation
4th Generation Real Loss: Monthly Premium for Men in Their 40s Rises from 12,795 to 14,573 Won
Actual Premium Increase Rates Should Be Checked in Insurer's Notice

Next year, the premiums for indemnity health insurance will increase by an average of 7.5%. Last year, the premium increase was limited to 1.5% as part of a cooperative financial effort, but this year, due to the worsening loss ratio and other factors, the increase returned to a level similar to the historical average.

The Life Insurance Association and the General Insurance Association announced on the 24th that the overall average increase rate for indemnity insurance premiums next year was calculated to be about 7.5%. The premium increase rate for indemnity insurance rose from 12% in 2021 to 14.2% in 2022, then dropped to 8.9% in 2023 and 1.5% in 2024. Although the increase rate will rebound next year, the insurance industry explained that it is 0.7 percentage points lower than the average of the past three years (weighted average based on premiums) of 8.2%.

Indemnity insurance is categorized by generation depending on the time of subscription, and the increase rates differ by generation. The first generation will see an average increase rate in the 2% range, the second generation around 6%, the third generation in the 20% range, and the fourth generation around 13%. For the fourth generation indemnity insurance, sold since July 2021, statistical sufficiency for five years has been secured by combining some third-generation statistics with fourth-generation statistics. Accordingly, rate adjustments will begin next year; for example, the monthly premium for a man in his 40s, which was 12,795 KRW, is expected to rise to 14,573 KRW next year.

However, the premium increase rate for indemnity insurance next year is an average level across insurance companies and is not uniformly applied to all policyholders. The increase rate applied to individual policyholders may vary depending on factors such as the renewal cycle, type of subscribed product, age, gender, and the loss ratio situation of each insurance company.

An industry official stated, "The actual premium adjustment level for the insurance you have subscribed to can be confirmed through the premium renewal notice sent by the insurance company at the time your individual insurance contract is actually renewed."