On the 28th, the 'Baedal Service Mutual Aid Association' Launches... Paid Transportation Insurance Premiums Reduced by About 20%

Membership Rate Target: 40% to 80% Within 5 Years

The Ministry of Land, Infrastructure and Transport announced on the 27th that it will hold the launch ceremony of the 'Delivery Service Mutual Aid Association,' which the government and major industries have been jointly promoting, on the 28th to reduce insurance premiums for delivery workers.

The mutual aid association includes nine certified small parcel delivery service providers such as Woowa Brothers, Coupang Eats Service, Fly and Company, Logiol, Manna Corporation, Vroong, Barogo, Superhero, and Spidercraft.

During the COVID-19 period, the delivery industry grew significantly, leading to a large increase in the number of delivery workers and, consequently, a rise in traffic accidents. However, the subscription rate for paid transportation insurance required for delivery work is very low due to high premiums. The average insurance premium for paid transportation of two-wheeled vehicles is about 1.78 million KRW, which is 11 times higher than the household insurance premium (160,000 KRW). The subscription rate for paid transportation insurance for two-wheeled vehicles (as of September 2022) is 38.7%.

In response, the government and industry have been jointly promoting the establishment of the mutual aid association since February last year to increase subscription rates through premium reductions. After discussions on industry capital contributions and the founding general meeting, the Ministry of Land, Infrastructure and Transport approved the establishment of the association on the 9th of last month.

Going forward, the mutual aid association plans to offer monthly and hourly insurance products specialized for delivery workers at about 20% lower prices compared to the market, aiming to increase the subscription rate of delivery workers to 80% within five years.

Oh Myung-so, the 2nd Vice Minister of the Ministry of Land, Infrastructure and Transport, stated, "Insurance plays a role similar to a safety helmet essential for the safety of delivery workers and serves as a social safety net for the general public. Despite the recent difficult business environment, I appreciate the industry's active participation in establishing the association by contributing funds to protect delivery workers. The government will also actively support the mutual aid association to settle in the market."

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