Foreigners' Indemnity Insurance Enrollment: Chinese Share at 70.7%

Loss ratio nearing 120%... Significantly higher than other nationalities

Last year, the proportion of Chinese nationals among foreign subscribers to indemnity health insurance at major non-life insurers such as Samsung Fire & Marine Insurance, Hyundai Marine & Fire Insurance, and Meritz Fire & Marine Insurance exceeded 70%. The loss ratio (the ratio of paid insurance claims to premiums received) for Chinese subscribers approached 120%.

According to the industry on the 30th, as of the end of last year, the total number of foreign indemnity insurance subscriptions at the three non-life insurers?Samsung Fire & Marine Insurance, Hyundai Marine & Fire Insurance, and Meritz Fire & Marine Insurance?was 207,066. Among them, the number of Chinese subscribers was 146,328, accounting for 70.7% of all foreign subscriptions. These three companies hold about 41.3% of the indemnity insurance market.

The average loss ratio for Chinese subscribers across the three companies is 119.3%. This means that when insurers received 1 million KRW in premiums from Chinese subscribers, they paid out an average of 1.19 million KRW in claims. This level far exceeds the average loss ratio of 112.1% for all foreign subscribers.

Recently, there have been concerns that some Chinese nationals have maliciously engaged in insurance claim shopping. On Chinese social media, a “trick” titled “How to cheat Korean health insurance and private insurance” has even been shared.

They maliciously concealed diagnostic records from China and then subscribed to domestic insurance to receive claims. According to the industry, the top 30 foreign nationals who received the most indemnity insurance claims from insurer A received between 12 million and 54 million KRW last year. Among them, 22 were Chinese. Mr. B was diagnosed with bladder cancer while living in China in 2018. After entering Korea in December 2019 and subscribing to insurance, he was diagnosed with bladder cancer at a domestic medical institution and claimed 10 million KRW for diagnostic fees.

While the National Health Insurance was running a deficit only among Chinese nationals out of the top 20 foreign subscriber countries, this phenomenon has spread to private indemnity insurance as well. Nevertheless, insurers have not been able to establish effective countermeasures. Even if Chinese subscribers violate their duty of disclosure when subscribing, insurers have no practical way to verify medical records from Chinese hospitals. Moreover, insurers cannot simply reject all Chinese nationals as this could stigmatize them as “discriminating only against Chinese.”

An industry official said, "Insurers practically have no way to screen out Chinese subscribers," adding, "Measures of a different dimension are needed."

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