Average 570 daily requests filed under new 8-week auto insurance treatment rule

Requests for medical necessity reviews filed by minor traffic accident victims seeking treatment beyond eight weeks are averaging about 570 a day, industry data show. With the so-called "8-week rule" now past its own eight-week mark since taking effect in September, attention is turning to whether the measure will translate into a meaningful improvement in auto insurance loss ratios.

According to the insurance industry and the Korea Auto Insurance Guarantee Corporation, more than 5,700 requests for extended-treatment reviews had been filed with the agency as of Friday, for a daily average of roughly 570 cases.

The 8-week rule requires minor injury patients classified under grades 12 through 14 of the injury scale set out in the Motor Vehicle Accident Compensation Act's enforcement decree to obtain a professional medical review confirming the necessity of treatment before they can continue receiving care beyond eight weeks. The system was introduced to curb excessive insurance payouts flowing to so-called "fake patients."

Under the procedure, a patient submits documents including a medical certificate, after which the insurer or automobile mutual aid association requests a review from the agency, which then issues its findings. The agency first determines whether treatment beyond eight weeks is medically necessary and, if so, whether the treatment period stated in the certificate is appropriate. The government has appointed more than 200 specialist physicians — split evenly between Western and traditional Korean medicine, each with at least 10 years of experience at a general hospital — to serve as reviewers.

The rule took effect Sept. 10. Patients seeking treatment beyond eight weeks must submit the required documents and file a review request around the seventh week after the accident. As a result, requests began coming in earnest during the last week of October, and the agency started issuing results on some completed reviews last week.

The government expects the rule to reduce unnecessary insurance payouts stemming from overtreatment, eventually leading to lower auto insurance premiums and easing the financial burden on policyholders.

The insurance industry is also cautiously optimistic about loss-ratio improvement. "It is still difficult to predict whether the policy effect of the 8-week rule will actually translate into a drop in loss ratios, so we will need to watch the trend through the end of the fourth quarter," an official at a non-life insurer said. "That said, given the intent of the system, we do expect loss ratios to fall."

Some have raised concerns that approval rates among traditional Korean medicine reviewers could be disproportionately high. An agency official pushed back on that suggestion. "We have no current plans to disclose approval rates separately by reviewer type," the official said, "but since the rates have not yet been made public, the claim that traditional medicine reviewers have higher approval rates is simply a preconception."