Disputes over insurance payouts remain the predominant concern among non-life insurance policyholders in South Korea, according to recent data from the Korea Consumer Agency.
According to the Asia Business Daily’s report, between 2022 and the first half of 2025 (H1 2025), the Korea Consumer Agency received 2,459 requests for damage relief related to non-life insurance products, averaging approximately 700 cases annually. Of these, nearly 90% were tied to disagreements over insurance payouts, with the proportion gradually increasing from 87.2% in 2022 to 90% in the first half of 2025.
Individuals in their 40s to 60s represented the majority of applicants, accounting for more than 74% of all cases. Those in their 50s made up the largest single group, with 716 applications. Indemnity insurance was the most frequently disputed product, representing 42% of all cases. When combined with health insurance, disputes related to medical and diagnostic expenses comprised over three-quarters of the total.
The most common reason for seeking damage relief was non-payment of insurance benefits, cited in 64.2% of cases. Other reasons included dissatisfaction with the calculation of payouts, issues related to disclosure obligations, and disagreements over disability or injury grading.
Among insurers, Meritz Fire & Marine Insurance received the most damage relief requests, totalling 465 cases. Hyundai Marine & Fire Insurance followed closely with 452 cases, while DB Insurance recorded 359 cases. Adjusted for the number of contracts, Heungkuk Fire & Marine Insurance reported the highest rate, with 44.3 applications per one million contracts.
Settlement rates across the eight largest non-life insurers averaged 28.3%. Hyundai Marine & Fire Insurance reported the lowest rate at 23.2%, while Samsung Fire & Marine Insurance had the highest at 31.1%.
The increase in non-life insurance disputes is emerging against a backdrop of significant regulatory and market shifts in South Korea’s insurance industry. The sector is currently adjusting to the simultaneous implementation of IFRS 17 and the Korea Insurance Capital Standard (K-ICS), which have introduced more stringent compliance and financial reporting obligations.
According to HyoBae Kim, head of business APAC at RNA Analytics, “South Korea was one of the few countries to implement both IFRS 17 and K-ICS at the same time, which has pushed insurers to adapt to a highly complex regulatory environment.” These new frameworks require insurers to overhaul their financial systems and reassess capital management strategies.
Such changes can impact how insurers calculate liabilities and process claims, potentially leading to differences in payout determinations or delays in claims handling. As insurers work to comply with these evolving standards, policyholders may experience increased uncertainty or dissatisfaction with claim outcomes, contributing to the volume of disputes.
Additionally, ongoing macroeconomic volatility – including possible interest rate cuts by the Bank of Korea – affects liability valuations and investment returns. This environment may prompt insurers to adjust product pricing, claims practices, or reserve levels, which could further influence the frequency and nature of disputes between insurers and policyholders.
