Insurance Companies Must Verify Whether Flooded Vehicles Are Scrapped... Flooded Vehicles Reach 12,000 Units

[Asia Economy Reporter Changhwan Lee] The Financial Supervisory Service (FSS) announced on the 24th that it has requested the insurance industry to thoroughly verify the scrapping process after insurance payouts to ensure that vehicles completely damaged by flooding are not illegally circulated in the used car market.

The FSS held a meeting with executives in charge of claims from 12 non-life insurance companies on the same day, urging prompt compensation for flood-damaged vehicles and asking that such matters be reflected in the claims handling process.

According to data compiled by the FSS and the non-life insurance industry, as of the 23rd, 11,988 flood-damaged vehicles had been reported to insurance companies, with estimated damages amounting to 154.9 billion KRW.

Among these, 7,026 vehicles were classified as total losses subject to scrapping, accounting for 58.6% of the total. About half of the total loss vehicles had completed insurance payouts as of the previous day. The average time taken until insurance payout was 5.6 days.

The FSS stated, "In cases where compensation is inevitably delayed due to disagreements over vehicle valuation, please minimize consumer inconvenience by informing affected vehicle owners about the advance payment system (50% of the estimated damage amount)."

It added, "For vehicles scrapped due to this recent heavy rain, insurance payouts should be made promptly after verifying the scrapping certificate. Furthermore, a thorough post-verification of the scrapping authenticity should be conducted, and the status of scrapping for all total loss vehicles should be reported to the FSS."

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