TongYang Life Insurance has introduced a long-term disability insurance product to help people prepare for the loss of their financial incomes due to disability. Photo courtesy of TongYang Life Insurance

Seoul-based life insurer launches LTD insurance

A rising number of people purchase auto, health, and life insurance in South Korea, one of the biggest insurance markets in the world. Still, few people seem to have insurance to protect themselves and their family from disability.

To deal with the risk, TongYang Life Insurance said this week that it had come up with a product to enable people to meet their financial obligations even if they became disabled for some reason.

The Seoul-based life insurer said that the product, dubbed “Guardian Angel Covering Living Expenses Even If I am Sick,” as its long-term disability (LTD) insurance.

In case its policyholder is incapacitated between 50 percent and 80 percent due to an accident or disease, he or she will be paid 500,000 won every month for the following 15 years.

If the disability is higher than 80 percent, the monthly benefit payment would be doubled to 1 million won, according to TongYang Life.

Of note is that the monthly payment would be halved to 250,000 won and 500,000 won, respectively when a policyholder suffers disability in less than a year after he or she bought the LTD insurance.

The accidental death benefit would amount to 50 million won, and 200,000 won will be offered to a policyholder every other year for a decade so that he or she can check health.

The new product comes with a total of nine riders.

Those between 20 and 60 are eligible for the LTD insurance, and its maturity is either 20 years or 30 years. When disability is higher than 50 percent, the policyholder would not have to pay monthly premiums any longer.

We developed a product, which is designed to help people prepare for their loss of financial incomes due to disability,” a TongYang official said. “Riders would offer further insurance coverage in tune with their specific needs.”

Observers point out that TongYang is trying hard to expand the LTD markets, which are not established here, yet.

“The LTD insurance market is a promising market. TongYang appears to adopt the Blue Ocean strategy rather than sticking to the Red Ocean strategy,” an industry source said.  

TongYang came to town in 1989 with a starting capital of 6 billion won. Over the past three decades, the company has grown into one of the representative life insurers in South Korea with an asset size of more than 30 trillion won.

CEO Jian Rong Luo is currently leading the financial outfit.