By Park Jin-hai
Vehicle insurance policies for a total of 117 models will either increase or decrease by 5 to 10 percent from next year, according to the Korea Insurance Development Institute (KIDI), Friday.
Amid increasing complaints that owners of expensive imported cars, cause excessive liability for domestic car owners in auto accidents, the institute announced new grades for vehicle models that become the basis of insurance policies.
On a scale of 1 to 26, the organization considers the degree of car damage in case of accidents, repair convenience and part prices in order to grade each model. Insurance companies take these grades into consideration when calculating vehicle insurance policies. When a grade is raised a notch, the insurance policy goes down five percent.
Out of 238 cars, 57 models including the Kia K3, Jaguar and BMW 5-series have seen downgrades, causing their policies to go up by 5 to 10 percent, while 60 including the Kia Sorento R, Volkswagen Golf, BMW X-series and Mercedes C-class have seen their grades improved, lowering their insurance policies by the same amount.
The remaining 22 models’ grades have not been changed.
Under grading system, the Kia new Sportage, model years 2006 - 2008, and Hyundai Equus, model years 2008 – 2012, received grade 25, the highest among all vehicles appraised, meaning their insurance policies will be relatively lower than vehicles with similar price tags.
The Hyundai Tuson and Ssangyong new Korando came next.
“With the grade system changes, insurance companies will adjust base insurance payments,” said a KIDI official. “However, it should not be taken as a test of each model’s safety.”
Insurance payments have increased over the last few years partly due to expensive imported cars. According to a report from the Korea Insurance Research institute, the amount of insurance payments increased an average of 2.9 percent every year for the last four years.