Yeouido, Seoul, Financial Supervisory Service /Courtesy of Financial Supervisory Service

The Financial Supervisory Service and the non-life insurance industry reported on the 14th that 400 individuals were referred for investigation on charges of facilitating insurance fraud just five months after the special law on insurance fraud took effect in August of last year.

The FSS explained that it conducted two planned investigations related to advertisements for intentional car accidents posted on high-paying part-time job websites in online cafes, referring 19 suspects for facilitating insurance fraud and confirming 24 cases of intentional car accidents. With the implementation of the special law, acts of facilitating, enticing, suggesting, and advertising insurance fraud are prohibited and can lead to punishment for mere facilitation.

Non-life insurance companies also referred a total of around 380 suspects to the relevant police station after confirming them through their own investigations into acts of facilitating insurance fraud. They actively promoted the fact that mere facilitation of insurance fraud can lead to punishment during the concentrated publicity period from August to September of last year, and they monitored related advertisements on over 10 major internet sites.

The FSS stated that with the legal obligation to notify the victims of car insurance fraud, they standardized notification deadlines and methods, and refund procedures for each insurance company to strengthen consumer protection against damage. They also refunded 230 million won to 877 contract holders who did not receive the surcharged premiums due to car insurance fraud.

The special law prohibits acts of facilitating and enticing insurance fraud, grants financial authorities the right to request information for investigations into insurance fraud, establishes criteria for reviewing the appropriateness of hospital admissions by the Health Insurance Review and Assessment Service, and aims to provide relief to victims of car insurance fraud.

The FSS noted, "We plan to strengthen monitoring of acts of facilitating insurance fraud and respond swiftly and strictly to new methods of insurance fraud that are gradually becoming more sophisticated and organized."