The Financial Services Commission of South Korea has announced a new free insurance initiative aimed at small business owners and vulnerable groups. This 'Coexistence Insurance Project' will provide insurance coverage through regional governments in six localities including Gyeongnam, Gyeongbuk, Gwangju, Jeonnam, Jeju, and Chungbuk. Starting from the third quarter of this year, the initiative features two types of insurance: life insurance and non-life insurance, each tailored to specific local needs.

The life insurance component is a credit life insurance product that pays out in the event of a policyholder's death or diagnosis of serious illnesses such as cancer or acute myocardial infarction. This payout can be used to repay existing loans, thereby alleviating the financial burden on small business owners and their families facing economic difficulties due to illness or accidents. The initiative also includes incentives for lower interest rates on policyholders' loans, designed to reduce the risk of default.

Additionally, non-life insurance products will cover various risks faced by small businesses. For instance, Jeju will introduce a climate insurance for construction sites that compensates for income loss due to work stoppage caused by extreme heat. Chungbuk will provide cyber care insurance against financial scams, while Gyeongnam will offer liability insurance specifically for small food establishments. The project underscores the government's commitment to enhancing financial inclusivity and support for these vulnerable populations over the next five years, including a substantial investment in comprehensive financial programs.