Car insurance costs can vary by $361

Auto insurance is mandatory for all drivers and the composition of insurance products in Korea is relatively simple. Items can be added to a plan to fit a driver’s needs in addition to the requirements to insure a person or a property.

The basic insurance model leaves many drivers thinking that insurance products are the same regardless of the company, which isn’t true.

The JoongAng Ilbo recently compared 11 major car insurance products in Korea based on data collected by the General Insurance Association of Korea and noticed significant gaps in insurance fees. The comparison, based on four simulated drivers, showed that the gap in insurance costs was as wide as 440,000 won per year ($361). The simulation was conducted using the different aged drivers and the value of the car.

The study supposed that a 24-year-old first-time car owner bought a 2013 midsize vehicle and was looking for insurance only for himself or herself.

Samsung Fire and Marine Insurance had the cheapest plan, at 850,000 won, while eight other insurers charged over 1 million won. The biggest gap in prices was 447,690 won.

When compared with three cases of older men driving older vehicles covering two drivers, the cost of insurance was much cheaper and the gap in the price of coverage narrowed.

The case studies showed that insurers offer a wide variety of products depending on age, gender and vehicle value, because each insurer targets different groups of consumers.

A representative from the General Insurance Association of Korea advised that the consumers should carefully compare products from different insurers. The association offers an insurance fee calculator on its website.

BY PARK JIN-SEOK [jiyoon.kim@joongang.co.kr]