SEOUL, May 26 (Korea Bizwire) — So-called ‘mini insurance’ plans for small amounts and short terms that provide guarantees for various kinds of risks in everyday life, covering the areas of pet animal insurance, leisure and travel insurance and weather insurance, will be introduced next month.
The Financial Services Commission (FSC) announced on Tuesday that a revision of the enforcement ordinance of the Insurance Law passed during a Cabinet meeting.
Under the revised enforcement ordinance, slated to take effect on June 9, the minimum paid-in capital for mini insurance companies has been set low at 2 billion won (US$1.78 million), aimed at encouraging the release of a variety of innovative insurance products that can satisfy various consumer needs.
The mini insurance companies will be able to offer all types of insurance products excluding those that require long-term guarantees (pension and nursing) and high capital (nuclear power and automobiles, etc.).
The FSC, in particular, expected the mini insurance companies to contribute to easing the burden of pet-raising households by providing insurance coverage for pet health care costs at affordable prices.
According to the FSC’s data, the number of pet-related insurance contracts for general insurance companies is estimated at about 22,000, a figure equivalent to only 1.1 percent of the total number of registered pets.
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