To Reduce Fake Patients in Car Accidents... "Mandatory Submission of Medical Certificates Needed"

Korea Insurance Research Institute Holds Public Hearing on Establishing Rational Treatment Practices in Auto Insurance

[Asia Economy Reporter Ki Ha-young] To curb excessive medical treatment of minor injury patients, which is cited as the main cause of automobile insurance premium increases, measures such as mandatory submission of medical certificates for minor injury patients and fault apportionment of medical expenses under Bodily Injury Liability 2 have been proposed.

On the 22nd, the Korea Insurance Research Institute held a "Public Hearing on Establishing Rational Treatment Practices in Automobile Insurance" to gather diverse opinions from various sectors regarding improvements to the automobile insurance system aimed at curbing excessive medical treatment of minor injury patients.

Jeon Yong-sik, Senior Research Fellow at the Korea Insurance Research Institute, who presented on "Improvement Measures for Medical Treatment Practices of Minor Injury Patients in Automobile Insurance," proposed reviewing the effectiveness of the unified medical expense review and claim system implemented in 2013, mandating submission of medical certificates for minor injury patients seeking treatment beyond three weeks, and applying fault apportionment to medical expenses under Bodily Injury Liability 2 for minor injury patients.

Research Fellow Jeon diagnosed, "Since the implementation of the unified medical expense review and claim system in 2013, the outpatient patient growth rate decreased from 11.5% before implementation to 3.9% after, whereas the medical expense growth rate increased more than tenfold from 0.4% before to 10% after implementation. The per capita medical expense for minor injury patients more than doubled from 330,000 KRW in 2014 to 650,000 KRW in 2019, which has increased pressure for insurance premium hikes."

He further proposed mandating medical certificates for long-term treatment of minor injury patients to improve treatment practices. This measure would require minor injury patients who wish to receive treatment beyond the usual three-week period to submit a medical certificate. Research Fellow Jeon explained, "It is estimated that about 5% of minor injury patients receive treatment for more than three weeks on average. Currently, minor injury patients can receive unlimited treatment based solely on subjective pain complaints without proof of injury or confirmation of recovery, which is expected to curb incentives for excessive treatment among some minor injury patients."

Similar systems are already in place overseas. The UK is promoting mandatory medical certificates during settlement processes, Japan does not pay insurance benefits without a medical certificate, and Spain and Italy require medical proof of minor injuries to pay insurance benefits.

Additionally, Research Fellow Jeon proposed fault apportionment for medical expenses under Bodily Injury Liability 2 related to minor injury patients. He explained, "Medical expenses for minor injury patients exceeding the Bodily Injury Liability 1 insurance limit (1.2 million KRW for injury grade 12, 500,000 KRW for grade 14) would be subject to fault apportionment under Bodily Injury Liability 2, and any shortfall due to fault apportionment would be covered by the Personal Injury Protection coverage." This is expected to act like a deductible under health insurance for some minor injury patients, thereby curbing excessive treatment."

Chairman Ahn Cheol-kyung of the Korea Insurance Research Institute emphasized, "The problem of excessive medical treatment for minor injury patients is a typical case of moral hazard caused by information asymmetry. Fundamental institutional improvements are necessary to solve the problem of excessive treatment for minor injury patients."

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