Liability insurance for people with developmental disabilities expands to local governments, filling a coverage gap for 280,000

[Financial News] A dedicated insurance policy covering liability that may arise in the daily lives of people with developmental disabilities has been adopted by four local governments within about three months of its launch. As a product that addresses risks difficult to cover under existing policies is combined with local government welfare programs, it is drawing attention as a new safety net that could ease the financial burden on people with developmental disabilities and their families.
According to the insurance industry on the 15th, the “Daily Life Liability Insurance for People with Developmental Disabilities,” launched by KB Insurance last July, has entered into contracts with four local governments, starting with Mapo-gu in Seoul, followed by Uiwang in Gyeonggi Province, Jecheon in North Chungcheong Province, and Jung-gu in Ulsan. It is a group policy under which local governments act as policyholders and enroll registered people with developmental disabilities in their areas as insured persons. It is seen as an example of public welfare and private insurance working together, providing coverage at the local level while reducing the enrollment burden on individual households.
There are about 280,000 registered people with developmental disabilities in South Korea. If they cause bodily injury or property damage to others in the course of daily life, liability may fall on the individuals themselves or on people with a legal duty to supervise them, depending on the circumstances of the accident and their capacity to bear responsibility. However, existing personal liability insurance for everyday life has had limited coverage, including because of exclusions for people lacking mental capacity. Mutual aid products that cover risks in related service settings also differ in the people and types of liability they cover from the daily-life liability of people with developmental disabilities themselves.
The KB Insurance policy covers legal liability for bodily injury or property damage that people with developmental disabilities cause to others in accidental incidents. It also covers cases in which a person with a legal duty to supervise them incurs legal liability because of limitations in the insured person’s capacity to bear responsibility. The coverage limit ranges from 10 million to 50 million won per accident and may vary depending on the number of people enrolled, among other factors.
As policies supporting independent living for people with disabilities in their communities expand, attention is turning to whether demand for related insurance will also grow. The Act on Supporting Independent Living in the Community and Housing Transitions for Persons with Disabilities, enacted in March 2025, is set to take effect in March 2027. As more people with disabilities live independently in their communities and take part in social activities, the need to prepare for accidents that may occur in daily life and the resulting liability could also increase.
Group accident and liability insurance is used overseas, particularly by regional mutual aid cooperatives in Japan and disability-related organizations. As the domestic market is still at an early stage, further adoption by local governments is expected to be key to market growth.
An insurance industry official said, “For people with developmental disabilities to participate more in society, a safety net is needed not only for care but also to reduce the compensation burden on the individuals themselves and their families when an accident occurs.” The official added, “We hope cooperation between local governments and private insurers will help address existing gaps in coverage and expand related coverage.”





[email protected] Hong Ye-ji Reporter