"Unfair Fault Ratio in Traffic Accidents"... Record High in Non-Life Insurance Dispute Mediation (Comprehensive)

Nearly 20,000 Dispute Resolution Applications Last Year

Samsung Fire & Marine, Hyundai Marine & Fire, DB Insurance in Order

[Asia Economy Reporter Oh Hyung-gil] Office worker Lee Jung-guk (45, pseudonym) was involved in a rear-end collision during driving over the Lunar New Year holiday. Lee had a serious dispute with the adjuster from the opposing party's insurance company over fault determination. Lee's vehicle was hit from behind while making a left turn at an intersection, but the opposing insurer notified him that his fault ratio was 10% due to a breach of duty of care.

Following advice from acquaintances, Lee applied for dispute mediation through an administrative agent to resolve the conflict with the insurance company. Ultimately, Lee was able to obtain a conclusion that the accident was caused solely by the fault of the other vehicle's driver.

Last year, the number of dispute mediation applications against non-life insurance companies reached a record high. This is interpreted as not only an increase in consumers opposing unilateral decisions by insurers but also a rise in consumers utilizing the dispute mediation system as it becomes more established.

According to the insurance industry on the 7th, the number of dispute mediation applications against non-life insurers last year was 19,466 cases (excluding duplicates and repeats), a 12% increase from 17,260 cases the previous year. The number of applications has been increasing annually, from 13,961 cases in 2016 to 16,191 cases in 2017.

By insurer, Samsung Fire & Marine Insurance had the highest number with 3,931 cases, followed by Hyundai Marine & Fire Insurance with 3,257 cases, DB Insurance with 2,868 cases, KB Insurance with 2,240 cases, and Meritz Fire & Marine Insurance with 1,775 cases. Large insurers with many policyholders also ranked high in the number of applications.

On the other hand, dispute mediation applications against life insurance companies have been decreasing. Last year, the number of applications against life insurers was 8,260, down 16% from 9,849 cases the previous year. This is attributed to the absence of prominently controversial insurance issues last year, unlike in the past with immediate annuities or unpaid cancer insurance claims.

Dispute mediation applications are procedures where the Financial Supervisory Service (FSS) facilitates an agreement between parties regarding disputes raised by consumers against financial companies. Consumers submit a dispute mediation application form containing the cause of the dispute and evidence to the FSS.

The Financial Dispute Mediation Committee only mediates cases requiring new mediation decisions, such as those without existing precedents or regulations, ambiguous contract terms needing interpretation, or legal judgment.

The high number of dispute mediation applications against non-life insurers stems from the characteristics of non-life insurance. Since the policyholder and the beneficiary are usually the same person or family in life insurance, disputes are rare. In contrast, in non-life insurance like automobile insurance, the policyholder and the beneficiary differ, leading to conflicts over the adequacy of insurance payouts.

Recently, there has been an increase in dispute mediation applications contesting fault ratios in traffic accidents. The widespread installation of black boxes in vehicles and the abundance of related information online about traffic accident fault ratios have led many to challenge the fault ratio assigned to them and seek resolution.

However, cases escalating to litigation are decreasing. Last year, the number of lawsuits filed by or against non-life insurers was 140, down from 192 the previous year.

An industry official explained, "The fact that many consumers express dissatisfaction with insurers' decisions while more consumers are opting for dispute mediation instead of litigation indicates that the related system is functioning well."

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