Mandatory Liability Insurance for Dangerous Dogs and Outdoor Advertisements... Insurance System Changes Next Year

Introduction of Illegal Contract Termination Right for Insurance Products
Fines for Violations of Duplicate Verification in Indemnity Insurance

[Asia Economy Reporter Oh Hyung-gil] Starting next year, owners of dangerous dogs will be required to subscribe to liability insurance. Fire service operators must also subscribe to liability insurance to compensate for damages caused by malfunctioning fire facilities.

According to the '2021 Insurance System Changes' announced on the 28th by the Life Insurance Association and the General Insurance Association, liability insurance for dangerous dog owners and fire service operators will be newly introduced in February next year.

The mandatory liability insurance for dangerous dog owners is intended to smoothly compensate for damages to others' life, body, or property caused by dangerous dogs. The targets include dogs classified as dangerous under the Animal Protection Act, such as Tosa Inu, American Pit Bull Terrier, American Staffordshire Terrier, Staffordshire Bull Terrier, Rottweiler, and their mixed breeds.

Also, starting in June, mandatory liability insurance for outdoor advertising operators will be implemented to compensate for damages to others' life, body, or property caused by falling or damage of outdoor advertisements.

From January next year, the refund rate for no-surrender or low-surrender refund insurance products must be designed within the refund rate of general insurance products.

Pre-checks for duplicate subscription to group indemnity insurance will be strengthened. Accordingly, the insurance industry plans to establish work processing standards to strengthen necessary procedures for pre-checking duplicate subscriptions of group indemnity insurance subscribers and to provide guidance on duplicate subscriptions.

A basis for imposing fines for violations of the obligation to confirm duplicate contracts for indemnity medical insurance, etc., will also be newly established.

Additionally, from the perspective of consumer protection enhancement, the core product explanation documents currently provided when subscribing to savings insurance and variable insurance will be unified under the same core explanation document across all financial sectors, and from March next year, they will be provided for all insurance products including protection insurance. Furthermore, the scope of prior advertisement review applied to insurance product advertisements will be expanded to include advertisements related to the work of insurance companies and insurance agencies.

The right to cancel illegal insurance contracts will also be introduced and implemented. With the enforcement of the Financial Consumer Protection Act in March next year, if an insurance contract violates sales regulations under the Act, financial consumers will be able to request cancellation of the illegal contract within one year from the date they become aware of the illegality or within five years from the contract date.

In July next year, a new 4th generation indemnity insurance product is scheduled to be launched. The core feature is to separate the product structure into covered and non-covered benefits, thereby optimizing deductibles and coverage limits to reduce premiums. For the first time, a premium differentiation system such as discounts or surcharges based on payment performance will be applied only to non-covered special contracts. The re-subscription cycle will be adjusted from the existing 15 years to 5 years.

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