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According to the non-life insurance industry on the 16th, last year’s total non-life insurance companies totaled 10 trillion 101.7 billion won. This is the first time that the insurance payment amount has exceeded 10 trillion won.
Excluding business operation expenses last year, insurance premiums (risk insurance premiums) received from consumers by insurers amounted to 7,7709 trillion won. Accordingly, insurance companies paid more insurance premiums than received insurance premiums, resulting in a deficit of 2,3608 billion won in real-life insurance alone. This is similar to the’worst deficit’ in 2019 (2,431.7 billion won).
The loss ratio, which is the ratio of incurred losses to risk insurance premiums, was 130.5%, still surpassing 130% following 2019. This means that they received an insurance premium of 100 won and paid an insurance premium of 130 won. The loss ratio has continued to exceed 100% and has been rising rapidly since 2018 (121.8%).
The accumulated real-life insurance deficit for four years from 2017 was KRW 7.346 trillion. If this trend continues, a cumulative deficit of close to 10 trillion won is expected to occur next year. The cumulative loss ratio over the past four years was 128.1%.
Despite the decline in hospital use last year, the reason for the loss of real-life insurance was due to an explosive increase in insurance payments for some medical items. In fact, last year, insurance payments related to cataracts and skin-related diseases increased by 51.4% and 26.8%, respectively.
Among them, in the case of cataracts, insurance premiums from 88.1 billion won in 2017 increased to 4101 billion won in 2020, a whopping 365.4% increase in three years. Compared to the previous year, it also increased by 51.4%.
Cataract is a disease in which the lens becomes cloudy and objects overlap. Elderly ophthalmologic disease causes people in their 60s and older to suffer, but recently, surgery in their 40s to 50s is increasing. In the case of cataracts, because it is possible to claim examination and surgery fees with actual loss insurance, some hospitals are promoting presbyopia and vision correction, and are widely recommended.
Skin disease insurance payments were paid 1287 billion won, an increase of 26.8% compared to the previous year. This is due to the surge in insurance payments, such as excessive laser treatments at some hospitals and large prescriptions for some dermatological creams. In addition, the digestive and endocrine systems also increased by 9% compared to the previous year, which was caused by excessive nutritional injections.
Of course, the musculoskeletal disorders, which account for 41% of the insurance payments, also increased by 8.3% compared to the previous year and 50.5% in 3 years, to 2,990,2 billion won. Musculoskeletal disorders include manual therapy.
The insurance industry is not able to overcome such loss of real-life insurance, and plans to increase insurance premiums this year. In particular, the premium for the old real-life insurance sold before 2009 is expected to increase by 20%.
An insurance company official said, “Last year hospital use has decreased by about 8%, but the payment of indemnity insurance has increased even more. It can be seen that there were a lot of payments by the company,” he said.