Despite this year's premium increases, last month's cumulative auto insurance loss ratio continued to 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—came to 85.8% for January–April, up 2.5 percentage points from a year earlier. The April loss ratio was 85.4%, down 0.3 percentage points from a year earlier.
KB Insurance posted a cumulative loss ratio of 86.2% through April, the record high among the four. Samsung Fire & Marine Insurance was at 85.7%, Hyundai Marine & Fire Insurance and DB Insurance at 85.6%, and Meritz Fire & Marine Insurance followed at 82.4%. The trend is seen as the continued impact of being unable to raise auto insurance premiums for the past four years.
The auto insurance loss ratio refers to the share of claims paid to policyholders relative to premiums received by insurers. The industry views 80% as the break-even point.
The loss ratio is also likely to rise this month. That is because minor-injury overtreatment at Korean traditional medicine hospitals and elsewhere, along with higher parts and repair costs, is pushing up physical damage losses. If traffic volume increases during the May holidays and the number of accidents climbs, the loss ratio could also rise.