Indemnity Health Insurance Payouts Near 17 Trillion Won, Setting All-Time High... Non-Reimbursed Benefits Reach 9.7 Trillion Won

Insurance Payouts Up 11.4% Year-On-Year
Manual Therapy and Non-Reimbursed Injection Claims Reach 3.7 Trillion Won
Loss Ratio Hits 101%, Widening Deficit and Increasing Pressure for Premium Hikes

Last year, payouts for indemnity health insurance approached 17 trillion won, marking an all-time high. Notably, non-reimbursed (non-NHI) insurance benefits accounted for 9.7 trillion won, making up 57% of the total and driving up the loss ratio for indemnity health insurance.

According to the "2025 Preliminary Business Results for Indemnity Health Insurance" released by the Financial Supervisory Service on June 3, payouts for indemnity health insurance in 2025 reached 17 trillion won, an 11.4% increase from the previous year’s 15.2 trillion won. Of this, reimbursed (NHI-covered) insurance benefits amounted to 7.3 trillion won, while non-reimbursed benefits totaled 9.7 trillion won.

Among non-reimbursed treatments, insurance payouts related to musculoskeletal disorders—including manual therapy—were the largest at 2.7 trillion won. This surpassed the combined insurance payouts for cancer, cerebrovascular, and cardiovascular diseases, which totaled 2.6 trillion won. Outpatient non-reimbursed injection therapy, including vitamin supplements, also reached nearly 1 trillion won.

Payouts for non-reimbursed treatments involving new medical technologies rose sharply as well. Insurance payouts for robotic surgery surged by 72.4% compared to the previous year, while payouts for prostate artery embolization and high-intensity focused ultrasound (HIFU) procedures increased by 64.6% and 46.0%, respectively.

The loss ratio for indemnity health insurance worsened again. Last year, the cumulative loss ratio stood at 101.0%, up 1.7 percentage points from 99.3% the previous year. This significantly exceeds the breakeven point for the insurance industry, which is considered to be 85%. As a result, the indemnity health insurance underwriting deficit also widened to 1.87 trillion won, a 15.6% increase from the previous year’s deficit of 1.62 trillion won. Underwriting profit or loss is calculated by subtracting incurred losses and actual business expenses from premium income.

By generation of policyholders, older indemnity insurance products with lower out-of-pocket expenses saw the highest claim amounts. The annual insurance payout per contract was highest for first-generation products at 740,000 won, followed by second-generation at 490,000 won, third-generation at 360,000 won, and fourth-generation at 290,000 won. Actual usage of non-reimbursed treatments was also double for first-generation policyholders (440,000 won) compared to fourth-generation (210,000 won).

By type of medical institution, clinics accounted for the highest proportion of insurance payouts at 32.0%, followed by hospitals (21.8%), general hospitals (17.6%), and tertiary general hospitals (15.0%). In particular, clinics (37.1%) and hospitals (26.9%) accounted for 64.0% of all non-reimbursed benefit payouts.

The Financial Supervisory Service believes that the increase in some high-cost non-reimbursed treatments is a major factor in the worsening loss ratio. In response, the agency plans to steadily implement measures such as introducing optional discount riders, facilitating contract conversion discounts, and enabling fourth-generation policyholders to switch products. They will also strengthen oversight and management to reduce non-reimbursed overtreatment and insurance claim leakage.

A representative from the Financial Supervisory Service stated, "The worsening loss ratio not only creates pressure for further premium increases in the future, but also raises concerns about increased disputes and potential harm to consumers. We will continue efforts to prevent excessive use of non-reimbursed treatments through cooperation with health authorities and related organizations."

This content was produced with the assistance of AI translation services.