Insurance fraud detections hit 5-year high of W620b in H1 2026

Insurance fraud detections in the first half of this year reached 620 billion won ($459 million), rising more than 9 percent from a year earlier, with people in their 60s accounting for the largest share of those caught and posting the steepest increase of any age group.

According to the Financial Supervisory Service on Monday, the total amount of insurance fraud detected in the first half of 2026 stood at 620 billion won, with 53,865 people caught — up 51.8 billion won (9.1 percent) and 2,849 people (5.6 percent) from the same period last year. The detected amount was the highest first-half figure in the past five years. First-half detections came to 511.4 billion won in 2022, 562.3 billion won in 2023 and 602.8 billion won in 2024, before dipping to 568.2 billion won in 2025 and rebounding this year.

By insurance type, auto insurance accounted for the largest share at 288 billion won (46.5 percent), followed by long-term insurance at 264.5 billion won (42.7 percent). The two categories together made up 89 percent of total detections. Long-term insurance saw the sharpest increase, with detected amounts rising 34.3 billion won (14.9 percent) over the year. Auto insurance detections rose 8.8 billion won (3.2 percent) in amount, though the number of people caught fell by 368 (1.3 percent). Life insurance detections climbed to 37.5 billion won, up 60.2 percent from 23.4 billion won a year earlier.

By fraud type, "accident content manipulation" — inflating insurance claims — was the most common, at 379.8 billion won (61.3 percent). Fabricated accidents accounted for 108.1 billion won (17.4 percent) and deliberate accidents for 86.4 billion won (13.9 percent). Among subcategories, forged medical certificates and excessive claims for hospitalization and surgery costs surged 39.9 billion won (37.2 percent) to 147.3 billion won, the largest increase of any subcategory. Cases involving manipulation or exaggeration of drivers, damaged property or accident dates in auto accidents also rose 18.5 billion won (17.3 percent). Among deliberate accidents, detections related to suicide and self-harm reached 42 billion won, up 71.4 percent over the year.

By age group, people in their 60s were the most frequently caught, at 13,247 (24.6 percent), followed by those in their 50s at 12,259 (22.8 percent), their 40s at 9,619 (17.8 percent) and their 30s at 8,399 (15.6 percent). The number of people in their 60s caught rose 3,191 (31.7 percent) from the same period last year, while those aged 70 and older also increased 25.3 percent to 5,096. By contrast, detections fell among people in their 20s (down 16.2 percent) and 30s (down 8.7 percent).

By occupation, office workers were the most common at 14,656 (27.2 percent), followed by full-time homemakers at 5,855 (10.9 percent), the unemployed and day laborers at 4,942 (9.2 percent), and vehicle transport workers at 2,246 (4.2 percent). Compared with the same period last year, office workers increased by 2,058 and full-time homemakers by 1,233. The number of insurance industry workers caught, including insurance agents, also rose 450 to 1,679.

The FSS attributed the rise in detected amounts to expanded cooperation with related agencies to combat hospital-led insurance fraud. The agency plans to continue broadening its coordination with the Korean National Police Agency, the Ministry of Health and Welfare, the National Health Insurance Service and the Health Insurance Review and Assessment Service. It particularly aims to step up the "fast track" system — under which police collaborate with the FSS from the investigation stage — to raise the rate of cases referred for criminal investigation and shorten the time needed to do so.

Regulatory measures against insurance fraud have also been tightening. When a revised Insurance Fraud Prevention Act took effect in August 2024, soliciting, inducing, encouraging or advertising insurance fraud became punishable offenses, carrying penalties of up to 10 years in prison or fines of up to 50 million won. The revision also granted financial authorities the power to request investigation materials from relevant agencies and information and communications service providers.

Starting in March next year, an amendment to the Insurance Business Act will take effect requiring the immediate removal from the market of insurance agents convicted of fraud. The FSS plans to swiftly cancel the registrations of agents whose fraud convictions are finalized.

In connection with the Korean National Police Agency's special insurance fraud crackdown, the FSS is running a "special reporting and reward period" through Oct. 31. The program has been expanded beyond personal injury insurance to include auto insurance. Targets for reporting include hospitals and clinics — including oriental medicine hospitals and clinics — and doctors suspected of personal injury or auto insurance fraud, as well as auto repair shops, rental car operators, drivers who cause deliberate accidents and brokers. Rewards of up to 50 million won are available depending on the tipster: hospital and clinic insiders can receive up to 50 million won; brokers who tip off hospital or clinic fraud, or repair shop and rental car operators, up to 30 million won; and members of the general public such as patients, drivers and passengers, up to 10 million won.

"If a hospital offers free treatment or unusually favorable terms, there is a possibility it involves insurance fraud," an FSS official said, urging the public to "secure concrete evidence and report it actively."