Korean National Police Agency Launches Special Crackdown on Insurance Fraud, Vows Tough Enforcement

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[Financial News] The police will conduct a special crackdown on insurance fraud this year.
The Korean National Police Agency (KNPA) National Office of Investigation announced on the 1st that from the 2nd until October 31, it will carry out a nine-month nationwide special crackdown on various types of public and private insurance fraud, as well as on the establishment and operation of illegal medical institutions such as so-called "illegally operated hospitals by a non‐physician."
Insurance serves as a social safety net that spreads the financial risks of illness and accidents among the public. However, crimes exploiting the complex benefit structures of insurance products continue to occur every year. According to the KNPA, the number of detected insurance fraud cases rose from 1,597 in 2022 to 1,600 in 2023, 1,899 in 2024, and 2,084 in 2025, showing a steady upward trend.
In particular, the KNPA explained that corporate-style illegally operated hospitals by a non‐physician that siphon off reimbursement for medical services, and schemes abusing various indemnity health insurance products, have evolved into "organized crime." Industry insiders and brokers use their specialized knowledge of insurance to design the fraud structure themselves and then collude with medical providers.
In response, the police plan to broaden the scope of previous special crackdowns, which mainly targeted public and private insurance benefit fraud. The new campaign will also cover the illegal establishment and operation of medical institutions and a wide range of medical practices carried out to obtain insurance payouts, with strict enforcement on all fronts.
Provincial Police Agency Anti-Corruption and Economic Crime Investigation Units and Criminal Investigation Mobile Units, along with intelligence teams at local police stations, will be designated and operated as a "dedicated insurance fraud investigation team" to concentrate investigative resources. For organized and habitual offenses, the police intend to actively apply the offense of organizing a criminal group, seek pre-indictment preservation of criminal proceeds for confiscation, and simultaneously pursue recovery of reimbursement for medical services, thereby enforcing the law rigorously.
In addition, the police will actively pay rewards for information leading to arrests to key informants and whistleblowers, and will run a separate special reporting and reward period alongside the crackdown.
A KNPA official stated, "Insurance fraud is a crime that directly affects people’s livelihoods, as it undermines trust in the insurance system, which functions as a social safety net, and causes leakage of insurance payouts, ultimately harming honest policyholders. We will crack down on it with strong enforcement."
welcome@fnnews.com Jang Yu-ha Reporter