Treatment costs for auto insurance patients with minor injuries are increasingly concentrated among those requiring long-term care. Although only 1 in 10 patients receiving traditional medicine exceeded 8 weeks of treatment, they accounted for more than half of the total treatment costs.
According to the insurance industry on July 13, an analysis of auto insurance claims from major insurers, including Samsung Fire & Marine Insurance, DB Insurance, Hyundai Marine & Fire Insurance, and KB Insurance, revealed that there were 1,226,000 patients with minor injuries, such as neck and back strains, classified as level 12-14. Of these, 1,085,000 patients (88.5%) completed their treatment within 8 weeks. The number of patients who received treatment beyond 8 weeks was 141,000, representing 11.5% of the total.
The share of treatment costs for long-term patients was significantly higher than their share of the total patient population. Out of a total treatment cost of 998.65 billion won for minor injury patients, 369.03 billion won was paid to those treated for more than 8 weeks, accounting for 37.0%. While these patients made up only 1 in 10, they received more than one-third of the total treatment costs.
The 8-week mark is often cited as a threshold for determining long-term treatment in auto insurance cases. The government and financial authorities are working on measures to objectively assess the necessity of treatment for patients who exceed the typical treatment period for conditions like strains. The aim is to protect patients who genuinely need long-term care while reducing unnecessary insurance payouts.
This concentration of treatment costs is particularly pronounced in traditional medicine. Among the 604,000 patients who received only traditional treatment, 58,000 (9.7%) exceeded 8 weeks of care. However, they received 115.84 billion won, which is 53.0% of the total traditional treatment costs of 218.62 billion won.
In contrast, patients who received only Western medicine showed a stark difference. Of the 322,000 patients treated solely with Western medicine, 14,000 (4.3%) exceeded 8 weeks. They received 16.76 billion won, which is only 7.9% of the total Western treatment costs. The share of treatment costs for those exceeding 8 weeks in traditional medicine was 45.1 percentage points higher than that for Western medicine.
Patients receiving both traditional and Western treatments also had a high proportion of long-term care. Among 300,000 patients who received combined treatment, 69,000 (23.0%) were treated for more than 8 weeks. They accounted for 2.36 trillion won, or 41.7% of the total costs for combined treatment.
The increase in long-term treatment costs is also impacting the loss ratio for auto insurance. As of May this year, the cumulative loss ratio for the four major insurers was 84.7%, up 1.9 percentage points from the same period last year.
Auto insurance operates on a structure where payouts to some policyholders are shared among all policyholders through premiums. Last year, about 85% of auto insurance policyholders were accident-free drivers. The insurance industry warns that if the appropriateness of treatment after 8 weeks is not properly managed, it could lead to increased premium burdens for the majority of drivers.
An industry official stated, “Expectations that measures for managing long-term treatment beyond 8 weeks will be implemented have been reflected in this year’s auto insurance premium increase calculations, which has limited the extent of the increase. However, if the introduction of these measures is delayed and coincides with an increase in accidents during the rainy season, the burden of auto insurance losses could grow.”
* This article has been translated by AI.
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