'Fixing the Stable After Losing the Cow' Fire Insurance Support to Become Nationwide Within the Year

Fire Insurance Support Available in 17 Cities and Provinces

Even if you lose the cow, you must fix the barn. It has been about a month since the fire at Incheon Hyundai Market, which burned down more than 70 stores and caused property damage worth billions of won. Amid various follow-up measures, Incheon City plans to support 80% of the traditional market fire mutual aid insurance premiums starting in the second half of this year. It has been confirmed that local governments, which previously had no subsidies, have also set plans to support insurance premiums with the goal of implementation within the year.

The traditional market fire mutual aid is a project managed by the Small Enterprise and Market Service. It was established in 2017 following the large fire at Daegu Seomun Market. It is a pure protection-type product without maturity refunds, and it guarantees full compensation for losses within the insured amount. Depending on the subscription type, it covers up to 60 million KRW (30 million for buildings, 30 million for movable property). Since it is a government-supported project, the insurance premium is about 40% cheaper than private insurance.

Traditional markets suffer from poor conditions, so even a small fire can lead to huge property damage. Over five years from 2017, there were 254 traditional market fires, with damages amounting to 83.7 billion KRW. However, the subscription rate for fire mutual aid, which could serve as a strong protective shield, is extremely low. According to data released by the Anti-Corruption and Civil Rights Commission at the end of last year, the rate was 24.6% (44,777 out of 181,895 stores nationwide as of September last year). There were two main reasons: lack of perceived necessity (45.8%) and insurance premium burden (46.9%).

Among the 17 metropolitan cities and provinces nationwide, 12 provide up to 90% support for insurance premiums, but the remaining five do not offer subsidies. One of these is Incheon. Supporting insurance premiums requires establishing related ordinances. Although Incheon City has such an ordinance, it did not promote the project. After the fire, the only support merchants received was an emergency disaster fund of 2 million KRW. Small merchants who could not subscribe to fire mutual aid due to premium burdens are now in a position where they must worry about their livelihoods immediately. To prevent this situation from recurring, urgent measures have been devised.

Other local governments without insurance premium support systems also plan to start the project within this year. Gwangju, Daejeon, Jeju, and Sejong cities are preparing. They were directly or indirectly affected by the Hyundai Market fire. Gwangju, which has already allocated related budgets, will begin support as early as next month, while Daejeon and Jeju will organize supplementary budgets in the first half of the year to support premiums from the second half. Sejong City, which does not yet have related ordinances, said, “It will be possible before next year.”

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