2026.10.30. The Fair Economy — The Financial Services Commission has finalized sanctions against 29 insurance industry workers implicated in insurance fraud, including revocation of registration for 19, a 180-day business suspension for 7, and a 90-day business suspension for 3.
The Financial Services Commission announced on the 29th that it finalized the sanctions on October 16, 2026, following a hearing on August 26 regarding the Financial Supervisory Service's inspection results, under Articles 102-2 and 102-3 of the Insurance Business Act. The sanctioned individuals include 28 insurance planners and one loss adjuster.
By type, traffic accident manipulation was the most common, with 16 cases. In a representative case, a planner colluded with multiple individuals to deliberately cause an accident and then filed a false claim, defrauding eight insurers of a total of 489.48 million won (about $3.76 million), resulting in cancellation of registration.
Five people were involved in false hospitalization cases, where they submitted false admission and discharge certificates despite not receiving normal inpatient treatment, defrauding six insurance companies of a total of 9.89 million won (about $7,100). A representative case resulted in the cancellation of registration. Four people manipulated medical records by obtaining or directly altering false diagnostic reports, defrauding five insurance companies of a total of 20.9 million won (about $15,000), and received a 180-day suspension of business.
Two people were involved in false or excessive diagnosis cases, where they obtained diagnoses despite not having the condition or exaggerated the damage, defrauding eight insurance companies of a total of 47.28 million won (about $34,000) and had their registration cancelled. One person violated the duty of disclosure by taking out an insurance policy in their younger brother's name and attempting to claim 200 million won (about $145,000) in death benefits, but failed, resulting in a 180-day suspension of business.
One other person forged another person's signature to join a whole life insurance policy with their ex-spouse as the insured and attempted to claim a total of 467.46 million won (about $335,000) in death benefits and surrender values, but failed, resulting in a 180-day suspension of business.
The Financial Services Commission determined that deliberately causing traffic accidents or submitting false or excessive hospitalization claims to obtain insurance payouts constituted grounds for registration revocation or business suspension under the Insurance Business Act. Details of the sanctions can be found on the Financial Supervisory Service's website, and those who dispute the measures may file an objection.
The scale of detected insurance fraud has been rising every year. In the first half of 2025, the amount of insurance fraud uncovered totaled 620 billion won (about $443 million), up 9.1% from the same period the previous year. The upward trend has continued into 2026: police conducted an intensive crackdown on traffic accident insurance fraud from June 15 to September 30, 2026, uncovering 2,045 cases and arresting 911 people. The confirmed damage amounted to about 7.52 billion won (about $5.37 million).
Staged traffic accidents emerged as the most common type of insurance fraud. In the police's 2026 crackdown as well, deliberate accidents accounted for 76.2% of all cases uncovered. The most common were deliberate accidents targeting vehicles changing lanes, with 600 cases (29.3%), followed by falsified accident details with 336 cases, staged accidents involving collusion between the at-fault and injured parties with 319 cases, and so-called "wrist-flicking" scams with 209 cases.
Sanctions against insurance industry workers implicated in insurance fraud have been imposed continuously since the law was amended in 2014. This latest round of sanctions follows an ad hoc examination by the Financial Supervisory Service.
0 Comments
No comments yet.