Car and Real-World Insurance Premiums Plus Cash Service Fees... Prices Rise One After Another from the Beginning of the Year

Shinhan and Woori Card to Raise ATM Fees from Next Month 1
Insurance Companies Pushing for Auto and Real-Expense Medical Insurance Premium Hikes

[Image source=Yonhap News]

[Asia Economy Reporters Hyungil Oh, Hayoung Ki] From the beginning of the year, various insurance premiums and card fees are expected to increase, which will likely add to household burdens. Companies say this is an unavoidable decision due to rapidly changing business environments and deteriorating profitability caused by the low interest rate trend, but there are concerns that already strained household finances will become even tighter.

According to the industry on the 9th, Shinhan Card and Woori Card will raise fees by 100 to 200 won starting next month when using cash services at ATMs and CDs (Cash Dispensers) operated by Korea Electronic Financial (KEF). Currently, fees range from 800 to 900 won depending on the time of use, but from next month, the fee will increase to 1,000 won regardless of the time. This is the first fee increase in 10 years.

The fee increase was made at the request of Korea Electronic Financial, which has recently faced increased operating costs. The reduction in cash demand and the rise of simple payment methods have led to decreased use of ATMs and CDs, relatively increasing operating costs. Korea Electronic Financial, a subsidiary of the NICE Group, is the largest financial automation equipment operator in Korea, currently operating about 7,000 cash automation machines nationwide. It is known that Korea Electronic Financial is negotiating fee increases not only with Shinhan and Woori Card but also with other affiliated card companies. If other card companies join the fee increase, the burden on consumers using cash services will inevitably grow.

Earlier, insurance companies also planned to raise automobile insurance premiums and indemnity medical insurance premiums at the beginning of the year. Automobile insurance premiums are expected to increase sequentially by around 3% from the end of this month to next month at the earliest. Although financial authorities requested restraint on the increase, it is expected that the premium hike will proceed due to a significant rise in automobile insurance loss ratios. Non-life insurance companies raised automobile insurance premiums twice last year due to increased minimum wages for repair fees. Authorities are preparing measures to reduce automobile insurance loss ratios. This year, they are preparing institutional improvements such as increasing the burden for drunk driving accidents, establishing procedures and organizations for reviewing automobile insurance medical fees, and introducing a deductible for motorcycle insurance.

Indemnity insurance premiums will also increase by up to 9% starting this month. Due to the 'Moon Jae-in Care' policy, excessive treatments such as non-reimbursable oriental medicine, manual therapy, and cataract treatments have increased, pushing the indemnity insurance loss ratio close to 130% as of the second half of last year. However, premiums for new indemnity insurance policies sold since 2017 are expected to decrease slightly. The new indemnity insurance separates non-reimbursable items such as MRI and manual therapy into special contracts with a higher deductible rate (30%), resulting in lower premiums.

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