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제목 Sales of Health Insurance that Rewards Healthy Behaviors

The Korean insurance industry has been selling health insurance products that reward the insured for improving their health since April 2018. For two months, around 60,000 policies have been sold by four insurers (two life insurers and two non-life insurers), with initial monthly premiums amounting to KRW 3,750 million. This translates into approximately 8,600 policies being sold per month by each insurer on average. More insurance companies are said to prepare for the launch of such products by the end of this year.

Insurers are developing insurance policies according to the guidelines by the insurance supervisory authorities for the development and distribution of insurance products that offer rewards for healthy behaviors. The guidelines are designed to support the local insurance industry with its efforts to develop and sell innovative insurance products in line with health care innovations. Examples of rewards include lower rates of insurance premiums and points that can be used to buy health care products or services.

To be rewarded, the insured need to prove that they are making the required effort to improve their health or stay healthy, such as walking, running or other types of physical exercise, and the results of which are assessed by the insurers. For example, an insurance policy would require the insured to walk 10,000 steps a day, and the insurance carrier would verify whether or not the requirement has been met through wearable devices like smart watches or bands.

A rewards-based health insurance plan can be beneficial on various levels. It gives individuals financial incentives for staying healthy, helping them offset the growing cost of health care. For insurers, their loss ratios would improve when their clients are less likely to become ill or die early. On a national level, it not only helps reduce the nation's rising health care costs but also facilitates the development of the health care industry as one of the important growth engines of the economy.


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