Agricultural Workers and Farm Machinery Insurance: Lower Premiums and Enhanced Coverage Starting Next Month

Average Premium for Comprehensive Machinery Insurance Reduced by 12.6%
Expansion of Government Support for Insurance Enrollment Age and Premiums

From next month, insurance premiums for the Agricultural Safety Insurance and Comprehensive Agricultural Machinery Insurance will be reduced, and coverage will be strengthened.

The Ministry of Agriculture, Food and Rural Affairs announced on the 26th that it will implement these system improvements starting in March.

Agricultural Safety Insurance compensates for medical expenses when farmers suffer injuries, illnesses, or disability diagnoses due to farm work. It is divided into General Types 1, 2, and 3, and an Industrial Accident type, depending on the coverage level. Comprehensive Agricultural Machinery Insurance covers 12 types of machinery, including cultivators, tractors, and rice transplanters, providing compensation for bodily injury, property damage, personal injury, and machinery damage occurring during operation or use. The government supports 50% of the premiums for both Agricultural Safety Insurance and Comprehensive Agricultural Machinery Insurance paid by farmers.

Starting in March this year, reflecting the reduced loss ratio of insurance companies due to fewer insurance claims last year, premiums for Agricultural Safety Insurance and Comprehensive Agricultural Machinery Insurance will be lowered. Agricultural Safety Insurance premiums will be reduced by 0.3% to 3.4% depending on the product, and the average premium for the 12 types of machinery under Comprehensive Agricultural Machinery Insurance will be reduced by 12.6%. Previously, in April last year, Comprehensive Agricultural Machinery Insurance premiums were also reduced by an average of 12.1% compared to the previous year.

Various system improvements for farmers will also be promoted. First, the upper age limit for enrollment in Agricultural Safety Insurance will be expanded to broaden the eligible population. For General Types 2 and 3 products, the upper age limit was 84 years, but considering the aging trend of the rural population, it will be extended to 87 years.

The government subsidy cap for premiums under Comprehensive Agricultural Machinery Insurance will be increased. For coverage items such as machinery damage, the current government subsidy cap is up to KRW 50 million based on the insured amount (machinery value), but this will be expanded to KRW 100 million. For example, a farmer owning a tractor valued at KRW 80 million who enrolls in insurance to cover machinery damage previously paid a total premium of KRW 632,000, with a government subsidy of KRW 197,500 and a personal burden of KRW 434,500. From March, the premium will be reduced to KRW 504,000, the government subsidy will increase to KRW 252,000, and the personal burden will decrease to KRW 252,000.

[Image source=Yonhap News]

Premium discounts for accident-free subscribers under the machinery damage coverage will also be expanded. To provide greater discounts to accident-free subscribers, the maximum discount rate will be increased from the current 30% to 40%.

Additionally, the coverage level of Comprehensive Agricultural Machinery Insurance will be strengthened, and subscriber options will be broadened. The treatment expense compensation limit for injuries requiring hospital treatment due to machinery accidents is currently KRW 15 million but will be raised to KRW 30 million. The property damage liability limit, currently KRW 100 million, will allow subscribers to choose between KRW 100 million and KRW 500 million.

Park Su-jin, Director of Agricultural Policy at the Ministry of Agriculture, Food and Rural Affairs, said, "By reducing the insurance premium burden and strengthening coverage for accidents occurring during farm work and machinery operation, while expanding farmers' choices, we aim to reinforce the safety net for farm management. We hope that more farmers will enroll in Agricultural Safety Insurance and Comprehensive Agricultural Machinery Insurance to effectively recover from damages caused by safety accidents and achieve stable livelihoods."

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