The insurance industry is establishing a solidarity fund of 30 billion won to support small businesses in obtaining essential insurance for free.
Kwon Dae-young, vice chairman of the Financial Services Commission, attended a signing ceremony for activating solidarity products in the insurance sector on the 26th, saying, "Solidarity products in the insurance sector are a policy initiated following the liquidity of death benefits, and it is expected to effectively support small business recovery and overcoming low birth rates."
Solidarity products are composed of six types: credit insurance, accident insurance, climate insurance, natural disaster insurance, fire insurance, and multi-child assurance insurance. They will be operated for the next three years. The life and non-life insurance sectors will each invest 15 billion won to support small businesses in enrolling free of charge in the solidarity products. The support ratio will be differentiated by region considering areas with population decline, and a maximum of 10% of the business funds will be supported by local governments.
Credit insurance is a product that allows small businesses to repay loans with insurance payouts in the event of death or disability. Accident insurance provides affordable injury coverage for small businesses or small- to medium-sized enterprises with fewer than five employees, while climate insurance compensates for income loss and damages to small businesses and daily workers caused by extreme heat, heavy rain, and similar issues.
Natural disaster insurance supports small businesses and vulnerable groups affected by typhoons and floods, while fire insurance compensates for damages caused by fires in traditional markets and alleyway shops. Multi-child assurance insurance covers injuries, severe illnesses, and emergency room costs for multiple births and children from low-income families for two years from their birth date.
The municipalities targeted for support will be selected through a public solicitation expected in early 2026. The insurance industry plans to select the first support municipality in the third quarter of this year and establish a working agreement and practical task force for the support and operation of solidarity products.
The Financial Services Commission noted, "We plan to brand the solidarity project in the insurance sector to continuously discover follow-up solidarity projects," adding, "We will prepare a variety of financial policies that people can feel and benefit from in their daily lives, not only in the insurance sector."