Mental health in South Korea: an evolving insurance market
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South Korea suffers high rates of mental illness and is in need of a stronger societal protection net for mental health. The COVID-19 pandemic has been a catalyst for more open discussion of mental health, and we see a larger role for private insurance over the long term.
More than a quarter of South Koreans say they have experienced at least one mental illness during their lifetime, and the country has had the highest suicide rate in the OECD for a number of years. This comes at a high social cost: the economy loses USD 4 billion every year due to depression alone.
Limited access to treatments and high out of pocket payments hamper the effectiveness of South Korea's public health insurance coverage of mental illness. South Korea's private mental health insurance market is in a very early stage of development, but insurers could contribute to alleviating the risks and costs of mental illness.
Mental health insurance propositions could address areas where public health insurance falls short of demand. Insurers can also focus on accumulating customer experience data, support the government in promoting mental health awareness, and identify the "right" client to target.
We explain the challenges in South Korea's mental healthcare landscape and where opportunities lie for insurers.