Car Owners Must Subscribe for Property Damage Insurance

Starting from February 22, car owners are required to subscribe to property compensation insurance as well as liability insurance. Also, the compensation limit of liability insurance will go higher, from the current 80 million won to 100 million won for death, and from 1.5 million won to 20 million won for injury per person.

Consequently, drivers who were subscribing for liability insurance only should additionally subscribe for property damage compensation insurance. Also, as the limit of liability insurance compensation has jumped up, there will be a hike in annual insurance premiums of about 70,000 to 100,000 won.

According to the damage insurance industry on Sunday, as the revised version of law dealing with car damage insurance will take effect on February 22, car owners must subscribe for property damage insurance worth at least 10 million won.

If a driver of 26 years of age who has more than three years of driving experience chooses to register for property damage insurance worth 10 billion won, the insurance premium for a light car will be 56,000 won, 74,000 won for a small car, 77,000 won for a midsize car, and 107,000 won for a recreational vehicle (RV).

However, for those who subscribe for comprehensive insurance, the insurance premium will not go up.

If one chooses not to subscribe for compulsory liability insurance and property damage insurance while maintaining his car, he or she will be subjected to one year in prison or a maximum five million won fine.

Seung-Jin Kim sarafina@donga.com