'Cancer Insurance Payment of 80 Million KRW on the Same Day'... '1.7 Days' from Claim to Payment

Insurance Payouts Accelerated
Streamlined Documents & Automated Review
Same-Day Payment for High-Value Claims

[Asia Economy Reporter Oh Hyung-gil] Heungkuk Life Insurance has automated the procedure for AI to review small claims under 2 million KRW among hospitalization, outpatient, and surgery insurance claims since the beginning of this year. About 40% of all insurance claims are handled by automated review. With the introduction of AI, the review has become more accurate and the speed of insurance payment has increased. From January to September, 69% of all insurance claims were paid on the day of the claim.

Life insurance companies are accelerating improvements such as simplifying claim documents or automating review procedures to quickly pay insurance benefits. This is because not only fair assessment through proper review but also eliminating delays in payment directly affects consumer satisfaction.

According to the insurance industry on the 9th, as of the first half of this year, the average insurance payment rate of life insurance companies reached 99.1%. The non-payment rate, where insurance benefits are not paid among all claims, was only 0.9%. The average time from receipt of claim documents to payment of insurance benefits is 1.77 days. This is faster than 2.28 days in the first half and 2.07 days in the second half of last year.

The cases where payment was not made within 3 business days from the date of receipt of claim documents (within 10 business days if verification of payment reason is required) accounted for 6.64% of all claims. This is a decrease of 3.38 percentage points compared to 10.02% in the same period last year.

Cases of same-day payment for high-value insurance claims are also increasing. Life insurer A paid Mr. B, who was diagnosed with cerebral hemorrhage and hospitalized for 23 days before passing away, 58.6 million KRW on the day of claim for cerebral hemorrhage diagnosis fees and death benefits. Life insurer C paid Ms. D, who was diagnosed with thyroid cancer, 80 million KRW on the day she applied for the diagnosis insurance benefit.

The acceleration of insurance payments is thanks to various improvements the industry has promoted to resolve related complaints. Strengthening guidance on claim procedures and simplifying claim documents are representative examples. In particular, the industry is actively implementing systems that only require documents essential for insurance review and abolish supplementary or redundant additional documents.

When the beneficiary’s own account can be verified, the requirement for a copy of the bankbook has been removed, and for hospitalization benefit claims, the previously required diagnosis and admission/discharge confirmation documents have been simplified to just one document.

An industry official said, "If the amendment to the Insurance Business Act related to simplifying indemnity insurance claims, which has been proposed in the National Assembly, passes, the ease of insurance claims could increase further," adding, "Improving all contract processes from product development to sales, insurance payment, and complaint handling from the consumer’s perspective is essential to enhance consumer satisfaction."

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