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Indemnity insurance premium rises again… how much will my insurance premium go up

[자료=금융감독원]

The financial authorities and the insurance industry reached an agreement on an average 14.2% increase in indemnity premiums after last-minute labor. However, the actual premium increase rate for indemnity insurance policyholders is expected to vary greatly depending on the insurance product and age. Considering that the renewal period for indemnity insurance is 3 to 5 years, it is expected that the premium for first and second generation indemnity subscribers who are about to expire this year will, on average, increase their premiums by more than 40% compared to last year. However, if you replace an existing product with a 4th-generation loss, your premium will be reduced by 50% compared to last year.

According to the insurance industry on the 1st, insurers plan to apply this year’s actual loss premium increase rate and inform subscribers soon.

This year’s actual loss premiums agreed by the financial authorities and insurance companies is an average of 14.2%. However, the actual insurance premium increase rate is expected to vary significantly for each insured.

First, premium increases are expected to be the highest for first-generation (sales until September 2009) and second-generation (for sale from October 2009 to March, 2017) subscribers.

This year, the rate of increase in insurance premiums for the first and second generation is an average of 16%. Considering that the renewal cycle of indemnity insurance is 3 to 5 years, the premium burden for subscribers renewing this year will increase by 30-50% compared to last year.

Third-generation indemnity subscribers, who have not received an increase in insurance premiums since its launch in April 2017, will also experience an average 8.9% increase in premiums compared to last year. The ‘stabilization discount special contract’ that was applied until last year for the third-generation loss has ended. The stabilization discount aims to reduce the third-generation actual loss insurance premium by 9.9% as much as the premium increase for the first and second-generation actual loss in order to induce the transition to the third-generation actual loss.

In addition to the average rate of increase, the natural increase in insurance premiums due to age should also be considered. Insurance companies take into account age-related disease outbreaks when calculating premiums. As the likelihood of developing diseases increases with age, it is additionally applied to insurance premium increases.

However, experts are advising that the 4th generation loss conversion benefit, which is temporarily operated for six months, is worth reviewing. Insurers have decided to give 50% discount on premiums compared to the previous one if the first to third-generation insured losers switch to the fourth-generation by the first half of this year. The discounted premium is maintained for one year.

An official from an insurance company said, “Indemnity insurance policy subscribers are expected to see significant differences in premium increase rates by age, gender, and subscription product. It’s better to change,” he advised. However, he added, “If the elderly subscribers frequent hospital visits, the burden of non-insurance increases, so switching to the 4th generation loss may increase insurance premiums in the future.


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