Affordable Mini Insurance Gains Attention..."Only the Essentials, Kept to a Minimum"

Expansion of Customized, Simple-Coverage Insurance Market
Lower Price Burden...Targeting Emerging Consumer Demand
A Springboard for Digital Insurers to Broaden Their Reach

Mini insurance products, which lower premium burdens and allow customers to choose only the coverage they need, are driving a shift in how people consume insurance. As a wide range of customized mini insurance products centered on everyday, life-oriented coverage spreads, competition among insurers to secure customers is becoming even more intense.

According to the insurance industry on February 16, Samsung Fire & Marine Insurance's direct-sales product "Four Seasons Insurance" will switch from the current winter plan to the spring plan starting next month, once the winter plan period ends. Four Seasons Insurance is a small-amount, short-term insurance (mini insurance) product that covers risks that are more likely to occur in each season, and provides coverage until the end of that season if the customer enrolls once per season. Key coverages designed for the spring season, when fine dust and pollen are severe, include benefits for the diagnosis of certain infectious diseases prevalent in spring, daily hospitalization benefits and surgery benefits for frequently occurring spring illnesses (respiratory diseases), and diagnosis benefits for five specific major respiratory diseases.

Compared with general insurance products, mini insurance has a more limited scope of coverage and a shorter term. Because the risk coverage is simple, premiums are relatively low, typically around 10,000 to 20,000 won. From an insurer's perspective, using online platforms, which reduce costs such as sales commissions compared with other sales channels, makes it possible to recover the principal quickly. Within the industry, there is an outlook that the launch of various low-cost insurance products tailored to emerging consumer demand and new lifestyles will continue.

"Customized design, only the coverage you need"...Expanding consumer choice

KB Insurance's "KB Direct My Way Cancer Insurance" puts its selectable structure at the forefront. Along with basic cancer diagnosis coverage, customers can choose additional cancer diagnosis coverage by body part. Because the types of cancer that individuals worry about differ, the product is designed so that customers can directly select and enroll in the coverage items they want. Without canceling their existing insurance, they can also add coverage only for specific body parts where they felt their current protection was insufficient.

NH Nonghyup Property & Casualty Insurance's "NH Hearim MBTI Insurance," which recommends necessary coverage based on MBTI (Myers-Briggs Type Indicator) personality types, is also gaining positive responses from consumers. For feeling-type (F) customers, it suggests coverage for voice-phishing losses, while for extraverted (E) customers, it proposes fracture diagnosis coverage, among others. Out of a total of 14 coverage items, customers can design protection that fits their individual circumstances and needs. The scope of coverage has been expanded to include a wide range of risks that can be experienced in everyday life, such as depression, gout, alopecia areata, and voice-phishing damage, as well as mental health disorders that may arise in the workplace.

Kakao Pay Insurance has adopted a differentiated strategy in overseas travel insurance. Unlike conventional overseas travel insurance, which only pays benefits when an accident occurs, Kakao Pay Insurance's overseas travel insurance is the first in the industry to introduce a "no-claim refund," returning 10% of the paid premium even to users who return home safely without any accidents. In addition, customers can directly set the coverage limits for medical expenses due to injury or illness occurring during overseas travel, as well as coverage for loss or damage to personal belongings. By allowing customers to select, add, or exclude only the riders they need, the product enables flexible plan design tailored to the purpose and circumstances of each trip.

In particular, mini insurance is playing an important role in helping digital insurers without face-to-face channels expand their customer base and establish themselves in the market. A Kakao Pay Insurance representative said, "The easy and simple subscription and claims process of mini insurance, reasonable premiums, and various discount benefits represent an approach that seeks to reinterpret insurance not merely as a means of protection, but as an everyday service that takes the overall customer experience into account," adding, "Along with small-amount, short-term insurance, we will expand our portfolio to include life-cycle-based and long-term insurance products to meet demand throughout the entire customer lifecycle."

This content was produced with the assistance of AI translation services.