Despite COVID-19, Traffic Accident 'Nailong Patients' Surge... No More Tolerance

Mandatory Submission of Medical Certificates
Revision of Automobile Insurance Underway

[Asia Economy Reporter Oh Hyung-gil] From the second half of the year, the compensation system will change so that minor traffic accident patients must present a medical certificate to receive long-term treatment.

According to the insurance industry on the 24th, Jeon Yong-sik, Senior Research Fellow at the Korea Insurance Research Institute, revealed improvement measures for the treatment practices of minor injury patients at the "Public Hearing on Establishing Rational Treatment Practices for Automobile Insurance" hosted by the Insurance Research Institute on the 22nd.

Minor injury patients are those classified as injury grades 12 to 14, including sprains (muscle or ligament injuries) and mild concussions.

The medical expenses paid to minor injury patients increased about 2.9 times from 345.5 billion KRW in 2014 to around 1 trillion KRW in 2020. Grade 12 corresponds to simple sprains, and grade 14 to simple bruises. Also, in 2007, the total medical expenses for minor injury patients were 2.9 times higher than those for moderate to severe injuries, which widened to 6.4 times in 2019.

The improvement plan includes making it mandatory for minor injury patients who wish to receive treatment for more than three weeks to submit a medical certificate. It is estimated that about 5% of minor injury patients receive treatment for more than three weeks.

The UK is promoting mandatory medical certificates during the settlement process, and Japan does not pay insurance benefits without a medical certificate. Spain and Italy also require medical proof of minor injuries to pay insurance benefits.

Additionally, an alternative was proposed to offset the medical expenses of minor injury patients exceeding the liability insurance Personal Injury Compensation I (PII) limit according to the degree of fault. The PII limit for minor injuries graded 12 to 14 ranges from 500,000 to 1.2 million KRW.

Currently, property damage compensation reflects fault, but personal injury compensation does not, so according to the research fellow, this creates an incentive for minor injury patients with a high degree of fault to receive more treatment to compensate for insufficient property damage compensation.

If the degree of fault is applied to medical expenses exceeding the PII limit for minor injury patients, drivers with high fault will only receive part of the excess medical expenses from the opposing party’s insurer, and the remainder will be covered by their own insurance’s Personal Injury Protection (PIP). If they do not have PIP coverage, they must pay the remaining medical expenses themselves.

The research fellow suggested that it would be desirable for the insurer to first compensate to prevent treatment delays due to personal burden and then recover the costs later.

The Financial Services Commission has announced plans to prepare measures to curb medical expenses for minor injury patients, and the Insurance Research Institute presented this improvement plan after discussions with the Financial Services Commission. The government plans to finalize the improvement plan for the minor injury patient compensation system after reviewing opinions gathered through public hearings and other channels.

The mandatory medical certificate for long-term treatment requires revision of the Ministry of Land, Infrastructure and Transport’s notification, and reflecting fault in medical expenses exceeding the PII limit can be done by revising the standard insurance terms, so it is expected to be implemented as early as the second half of the year.

On the same day, voices from the medical community also expressed the need to improve treatment practices for minor injury patients.

Professor Kim Oh-hyun of Yonsei University’s Department of Emergency Medicine said, "According to occupant injury analysis, 47.5% of all patients complain of cervical sprains or bruises," adding, "In the case of minor patients, symptoms are really mild, but sometimes they may exaggerate. This can be seen as a problem leading to a waste of medical resources."

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