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Car insurance premiums to be adjusted differently depending on fault

All Headlines 16:34 July 10, 2017

SEOUL, July 10 (Yonhap) -- Drivers who are less at fault for a car accident, will pay lower auto insurance premiums in a change from the current system, the financial regulator said Monday.

The change, which will go into effect from September, is aimed at adjusting the degree of balance between at-fault drivers and those who are much less responsible for an accident after reporting the case to an insurance firm to get compensation.

Currently, if a driver is 80 percent responsible for an accident with the other driver being blamed for 20 percent of the mishap, their insurance rates will go up by the same rate.

From Sept. 1, a policyholder who is deemed as being less than 50 percent responsible for a car accident will pay lower premiums, the Financial Supervisory Service (FSS) said in a statement.

For instance, if a driver who is 20 percent responsible for a car accident, the driver's car insurance rate will jump 34 percent to 550,000 won (US$475.80) under the current system.

The change will allow the driver's car insurance rate to rise just 10 percent to 450,000 won under the same conditions, the financial regulator said.

Kwon Soon-chan, deputy governor of insurance at the FSS, said overall auto insurance premiums for victims will decline under the new system.

Car insurance premiums for about 150,000 victims will fall by an average 12.2 percent, or 15.1 billion won, Kwon said.
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