Kang Ho Insurance Development Institute. / Photo = Insurance Development Institute
[한국금융신문 유정화 기자] The Korea Insurance Development Institute announced that it will focus all its capabilities on enhancing the viability of the insurance industry to overcome the management crisis of insurance companies caused by low interest rates and growth. It also develops new products such as insurance against infectious diseases and manages the loss ratio by creating excess medical indicators for lightly injured patients in auto insurance.
On the 1st, in a non-face-to-face press conference, the head of the Insurance Development Institute Kang-ho said, “The survivability of insurance companies for overcoming the crisis by creating new demand in response to changes in the social, economic, and institutional environment, strengthening infrastructure, and reducing moral hazards. We will focus all our capabilities on strengthening.”
To this end, the Korea Insurance Development Institute plans to actively support insurance companies △proactive product development △low-cost and high-efficiency work △response to the introduction of new systems, △continuous management of automobile and injured medical insurance.
First, the Korea Insurance Development Institute sets out to develop new products in response to infectious diseases and changes in government policy. By developing a risk assessment model that can predict the scale of damage caused by infectious diseases such as Corona 19, insurance companies can develop products such as corporate suspension insurance. Corporate suspension insurance is an insurance that guarantees damage caused by the interruption of business activities. In addition, a variety of insurance product plans will be prepared in accordance with the demand for guarantees resulting from fostering the hydrogen economy and changes in various disaster safety insurance systems.
Director Kang Ho of Development said, “It will be an opportunity for the insurance industry to grow to the next level by enhancing the social responsibility of the insurance industry by preserving losses due to infectious diseases and disaster risks in difficult times due to a pandemic.”
In addition, the development center plans to provide a’preemptive product consulting service’ promptly in response to market demand. Periodically, we plan to provide’customized service for each company’ through phased consultations such as △new product design △statistics survey △risk rate calculation △preparation of product plans. “We will support the expansion of the insurance market by providing services that meet actual demands, such as products that subdivide the insurance group by health condition, comprehensive insurance products for specific diseases, and products through the combination of statistics held by external organizations and insurance statistics.” Said.
It plans to provide auto insurance product development services in response to environmental changes such as the entry of fintech-based professional insurance companies, big tech’s entry into the insurance market, and future automobile development. In other words, it supports new risk analysis and new product development, such as fintech combined auto insurance, electric vehicles, self-driving cars, and personal mobile devices (PM).
A joint infrastructure is also prepared to improve cost and work efficiency of insurance companies. First, the’Artificial Intelligence (AI) Rate Verification System (KAIRS)’ will be improved in response to the reduction in the update cycle of the experience risk rate of insurance companies, expansion of new products, and increasing demand for statistics. In addition, it supports the improvement of the efficiency of damage adjustment work in response to the compensation process on-tact. Reflecting industry demand, it will provide advanced user convenience, such as automatic recognition of user wages and improvement of photo management functions.
In addition, Director Kang Ho said, “We will actively support the strengthening management of automobile insurance and medical insurance for loss of loss, which are representative social safety nets, again this year.” We plan to do our best to improve excessive insurance payments by minimizing Moral Hazard and supporting system improvement.
In the case of auto insurance, it plans to estimate the amount of excess medical expenses for minor injuries (injuries 12-14), which is one of the main reasons for the deterioration of the loss ratio, and develop and present a management index for excessive medical care. The management index for over-treatment refers to the presentation of the statistically appropriate level of medical expenses and treatment period as an index. In addition, it contributes to the creation of appropriate insurance claims in case of minor accidents by providing the’Occupant Injury Risk Analysis’ and promotes public debate about the standard treatment guide for minor accidents. In response to changes in the maintenance fee system, it also supports the payment of an appropriate level of insurance.
It is also working on calculating rates and preparing product plans for 4th generation real-life insurance products. In order to continue to play the role of a social safety net that complements the public’s health, the 4th generation of indemnity medical insurance products with a reorganized coverage structure such as discounts and premiums as much as medical use will be released in July this year. In order to manage non-payment, which is the main culprit for the increase in real-life insurance premiums, non-payment items are separately accumulated in basic statistics data of insurance companies, and the management of non-payment insurance payments is strengthened through collection and analysis of sample statistics of medical expenses receipts and detailed statements.
In addition, the Korea Insurance Development Institute responded to the introduction of new systems such as the provision of industrial households to predict the size of insurance liabilities and simulations according to changes in the economic and financial environment in preparation for the new accounting (IFRS17) and new payment capacity system (K-ICS), which are scheduled to be introduced in 2023. We plan to continue to promote practical support.
Reporter Yoo Jeong-hwa [email protected]