The implementation of the new International Accounting Standards (IFRS17), which focuses on assessing the market price of insurance liabilities, has been postponed to 2023. Accordingly, the Accounting Standards Committee of the Korean Accounting Standards Institute revised the insurance contract standard. (Photo = Getty Image Bank)
It was found that the so-called’Moon Jae-in Care’, which strengthens health insurance coverage, reduces the payment of ineligible medical insurance (indemnity insurance), that is, the reflected profit was 2.42%. This estimate is used for adjustment of real-life insurance premiums.
The Ministry of Health and Welfare and the Financial Services Commission held a video conference of the Public and Private Insurance Policy Council on the 24th and shared the results calculated by the Korea Development Institute (KDI).
The government previously calculated the reflected profit from real-life insurance once in 2018, resulting in a 0.60% reduction in payments.
However, as it was pointed out that there was a limitation in the representativeness of the sample data and the time of the survey, the effect of recalculating the effect of reducing the payment of actual loss insurance was recalculated.
This time, KDI linked all the information on insured insurance subscribers and health insurance claims data, and comprehensively reflected and analyzed the latest medical use, resulting in a result of 2.42%.
However, this study did not reflect changes in aspects such as the expansion of the use of non-paid medical services, pointed out by the so-called’balloon effect’.
In the report, KDI researchers said, “(The use of non-paid medical services) is confirmed only in individual cases, and it was difficult to quantify, so it was not reflected in numbers.”
The research team also mentioned the limitations of this study, saying, “The rate of reduction in the size of insurance benefits compared to the total amount of insurance paid depends on the proportion of the total amount of insurance paid for indemnity insurance for benefits.
Applying a moving average of 34.67% of the proportion of health insurance payable medical expenses to the total billed medical expenses, the reduction rate of total insurance payments was 0.83%.
The government has been expanding the coverage of health insurance every year since 2017. As a result of this, it has been trying to reduce insurance premium increases the following year by grasping the degree of reflected profits, seeing that it has the effect of reducing the insurer’s actual loss insurance.
However, the insurance industry argues that the increase is inevitable as the loss ratio for real-life insurance is expected to exceed 130% this year following 133.9% last year.
The insurance industry is in a position that it needs a 21% increase in insurance premiums, but as the Financial Services Commission recently presented a related opinion, the actual loss insurance coverage for next year is expected to increase to around 10% on average.
Eunji Cha, reporter Hankyung.com [email protected]
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