According to Moody’s, South Korea’s aging population will be a challenge for insurers in the upcoming years. The people exceeding the age of 65 are expected to represent 32% of the population by 2040 against 16% in 2020.
The old-age dependency ratio will move from 22.1% in 2020 to 57.2% by 2040. The underwriting of traditional insurance products, mainly aimed at the working age population, such as mortality protection and motor third party liability, is expected to decrease.
In order to adapt to these demographic changes, insurers are required to develop insurance coverage against longevity and morbidity risks.
From now on, insurance contracts must cover the elderly's illnesses.
Health risk is a challenge for insurance companies due to inflation in medical costs and regulatory intervention.
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