The national deposit insurance coverage limit applicable to financial companies (i.e., banks, savings banks, insurers, and financial investment companies) and mutual financial institutions (i.e., National Credit Union Federation of Korea, National Agricultural Cooperative Federation, National Federation of Fisheries Cooperatives, National Forestry Cooperative Federation, and Korea Federation of Community Credit Cooperatives) will be increased from the current KRW 50 million to KRW 100 million. This change is reflected in the proposed amendments to the Enforcement Decree of the Depositor Protection Act, which were approved by the State Council on July 22, 2025, and are scheduled to come into effect on September 1, 2025.
Accordingly, the Korea Deposit Insurance Corporation (the “KDIC”) will now compensate policyholders who are not able to receive payments due (e.g., surrender value, maturity benefits, insurance claim proceeds, etc.) when the underlying insurer becomes insolvent, up to KRW 100 million.
As a follow-up measure to the increase in the national deposit insurance coverage limit, the Financial Services Commission and the KDIC are planning to assess the appropriate deposit premium rates for each industry sector and to apply such revised rates from 2028.
