[Square] Delivery Rider Safety... Both Insurance Enrollment and Accident Prevention Are Necessary

Gyudong Kim, Research Fellow at the Korea Insurance Research Institute

Until earlier this year, the biggest issue for delivery riders was expensive insurance premiums and low insurance enrollment rates. Delivery riders demanded government-level measures, claiming they were being pushed into a safety blind spot due to high insurance costs. The average insurance premium for commercial delivery motorcycles is sometimes up to 10 times higher than that for private motorcycles.

Because of the high premiums, many riders hesitate to enroll in insurance or only subscribe to the mandatory insurance, making adequate compensation difficult in case of accidents. It is said that even novice riders are often uninsured due to the expensive premiums. While riders want premium reductions, insurance companies face deep concerns as the loss ratio for commercial delivery motorcycles is already around 150%. In fact, many argue that rather than lowering premiums, traffic enforcement on motorcycles should be strengthened.

However, with the recent surge in demand for delivery services, the safety of delivery riders has become a bigger issue than insurance enrollment. Especially after a series of fatal accidents involving delivery riders in August, concerns about riders' working conditions have been raised. It is difficult for riders to comply with traffic laws while delivering within the time frames set by platforms. Thus, the safety of riders and insurance enrollment cannot be resolved with simple solutions.

What are the improvement measures to ensure riders' safety and expand insurance enrollment? First, delivery riders themselves must take the lead in safe driving. Motorcycles frequently violating traffic signals and crossing the center line are often seen disregarding safety. Motorcycles have frequent accidents proportional to their high insurance premiums, often resulting in serious injuries or fatalities. As of 2020, motorcycles numbered about 2.3 million, accounting for 8.6% of all registered vehicles, but they accounted for 10.1% of traffic accidents and 17% of traffic accident fatalities. Moreover, the fatality rate of motorcycle accidents (2.47%) is 1.7 times higher than the overall traffic accident fatality rate (1.47%). Insurance enrollment and safety issues cannot be solved without riders' efforts.

Second, improvements in traffic enforcement systems that can encourage safe driving of motorcycles are necessary. Motorcycles only have license plates mounted on the rear, which traffic surveillance cameras cannot capture. Considering that traffic police cannot enforce regulations one by one, the government is effectively neglecting motorcycle traffic violations. While enforcement is not a cure-all, it cannot be denied that appropriate enforcement encourages safe driving. Recently, the National Police Agency is reportedly developing unmanned enforcement equipment capable of capturing motorcycle license plates. If equipped with artificial intelligence (AI) technology that can also identify whether drivers are wearing safety gear, it would greatly aid riders' safety.

Third, delivery platforms must improve working conditions for riders' safety. Tight delivery schedules can lead to riders violating traffic laws and causing accidents. It is incomprehensible that platforms calculate delivery times based only on straight-line distances without considering traffic conditions or actual travel distances. It would be shameful if the platform’s AI system, which knows delivery data inside out, is unaware of riders’ speeding and signal violations. Platforms should not only demand fast deliveries from riders but also monitor speeding and signal violations to promote riders’ safety.

Fourth, the rating system needs improvement. Motorcycle insurance currently offers only premium discounts but no surcharges, so high-risk drivers cannot be charged higher premiums, causing the base premium to rise. Especially, first-time subscribers tend to avoid insurance due to high premiums, which can lead to prolonged uninsured status. However, a premium surcharge system can motivate drivers to drive safely and lead to increased insurance enrollment. The recent news that the Korea Insurance Development Institute has started improving the motorcycle rating system is welcome.

Insurance compensates for losses from unforeseen accidents, but when it comes to accidents directly related to our lives, the importance of accident prevention cannot be overlooked. Efforts to prevent accidents and improvements in the rating system will lead to premium reductions and increased insurance enrollment. Both insurance enrollment and accident prevention are necessary for riders’ safety.

Kim Gyudong, Research Fellow, Korea Insurance Research Institute

This content was produced with the assistance of AI translation services.