South Korea: Short-term mini insurance plans are becoming a new trend in the insurance industry

| 07 Oct 2020

South Korean life insurance companies are launching mini-plans, with affordable premiums and simple insurance policies to target at young customers, that are becoming a new trend in the insurance industry, according to The Korea Life Insurance Association.

Mini-plans, also known as simple insurance or low-cost and short-term insurance plans, offer simple coverage, with a short payment period between six months and one year. Monthly premiums are less costly, ranging from 100 to 10,000 won (US$8.60).

Normally, a life insurance plan requires customers to pay costly insurance premiums over an extensive period of time, which is why customers engage in extensive meetings with insurance planners before they decide upon purchasing a plan.

Customers can purchase plans online by simply completing an identification process, without having to go through documentation reviews or other time-consuming procedures.

More consumers are gaining interest in simple insurance plans as contact-free services are increasing in demand amid the coronavirus pandemic, the Korea Life Insurance Association explained.

In a survey conducted by the Korea Insurance Research Institute, 50% of younger Koreans in their 20s and 30s were highly dependent on online channels to look up insurance plans.

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