Samsung Fire & Marine Insurance(000810) filed lawsuits against more than 50 Korean medicine hospitals nationwide over the past two years. That is about 90% of all Korean medicine hospitals that non-life insurers sued during the same period. As auto insurance loss ratios have risen recently, Samsung Fire & Marine Insurance, the market share leader, appears to be taking aggressive legal action to prevent fraudulent insurance payouts. The Korean medicine hospital industry is pushing back, saying Samsung Fire & Marine Insurance is filing an excessive number of lawsuits to defend profitability.
According to a survey by the Association of Korean Medicine Hospitals on the 29th of 615 Korean medicine hospitals nationwide, the number of Korean medicine hospitals that non-life insurers filed civil or criminal suits against from Oct. 2024 to this month was 56. Of these, Samsung Fire & Marine Insurance sued 52, accounting for 93% of the total. Most of the lawsuits are said to be related to auto insurance.
The reasons for filing suits were found to include pre-prepared decoctions, loss-of-income compensation during work stoppage, and unjust enrichment. Pre-prepared decoctions refers to making herbal medicine in advance rather than compounding it to match a patient's symptoms and constitution. Under an administrative rule of the Ministry of Land, Infrastructure and Transport, non-life insurers pay insurance benefits only for cases in which decoctions are prescribed to match the patient's symptoms.
Loss-of-income compensation during work stoppage refers to the amount an insurer pays as part of the reduced income of an insured person who is injured in a traffic accident and has to stop working. Some insurers are said to argue that, to the extent benefits were overpaid due to excessive treatment by Korean medicine hospitals, medical institutions are liable for damages. Unjust enrichment refers to excess insurance money a patient received due to unnecessary treatment.
A Samsung Fire & Marine Insurance representative said, "Because our market share in auto insurance is high, the number of legal actions may also be relatively large. We are responding based on principles to matters where we suspect false claims."
Based on total written premiums last year, Samsung Fire & Marine Insurance's auto insurance market share was 29%, the highest among non-life insurers. In the first half of this year, the cumulative auto insurance loss ratio (simple average) of the four major non-life insurers (Samsung Fire & Marine Insurance·Hyundai Marine & Fire Insurance(001450)·DB Insurance(005830)·KB Insurance) was 84.5%, up 1.9 percentage points from a year earlier.
According to the Health Insurance Review & Assessment Service's "2025 auto insurance medical expense statistics," last year's auto insurance medical expenses for Western medicine were 1.1065 trillion won, up only 14 billion won (0.12%) from 2024. By contrast, Korean medicine expenses were 1.6972 trillion won, up 821 billion won (5.08%) over the same period.
The Korean medicine hospital industry is pushing back. The Association of Korean Medicine Hospitals has been holding rallies since last year at locations including Samsung Fire & Marine Insurance's Gangnam office building, calling for an end to indiscriminate lawsuits. The association said, "Samsung Fire & Marine Insurance is trying to block policyholders' Korean medicine treatment to maximize profits. Many Korean medicine hospitals are providing lawful care to traffic accident patients, and most of the lawsuits Samsung Fire & Marine Insurance filed were dismissed as not guilty."