Despite this year's insurance premium hikes, last month's cumulative auto insurance loss ratio is on the rise.
According to the non-life insurance industry on the 21st, the cumulative auto insurance loss ratio (simple average) for the four major companies — Samsung Fire & Marine Insurance, Hyundai Marine & Fire Insurance, DB Insurance, and KB Insurance — was 85.8% for January–April this year, up 2.5 percentage points from the same period a year earlier. The April loss ratio was 85.4%, down 0.3 percentage point from a year earlier.
KB Insurance posted the highest cumulative loss ratio among the four through April at 86.2%. Samsung Fire & Marine Insurance followed at 85.7%, Hyundai Marine & Fire Insurance and DB Insurance at 85.6%, and Meritz Fire & Marine Insurance at 82.4%. The impact of being unable to raise auto insurance premiums for the past four years appears to be continuing.
The auto insurance loss ratio refers to the ratio of claims paid to policyholders to the premiums received by an insurer. The industry views a loss ratio of 80% as the break-even point.
The loss ratio is also likely to rise this month. That is because excessive treatment of patients with minor injuries at Korean medicine hospitals and other facilities, along with rising parts and repair costs, is pushing up property damage losses. If the number of accidents increases as traffic volume rises during the May holidays, the loss ratio could climb as well.