South KoreaHow is traffic accident settlement calculated?
Traffic accident settlements in South Korea are calculated based on actual damages (medical costs, lost wages, pain and suffering), with compensation guided by the 'Standards for Calculating Compensation for Traffic Accidents' issued by the Korean Supreme Court.
What the Law Says
South Korean law does not prescribe a fixed formula but relies on officially published compensation standards and civil liability principles to determine fair settlement amounts after traffic accidents.
Compensation for traffic accidents is governed by the Civil Act and the Automobile Management Act, but the actual calculation follows the non-statutory 'Standards for Calculating Compensation for Traffic Accidents' (commonly called the 'Traffic Accident Compensation Standards'), annually updated by the Supreme Court of Korea. These standards provide benchmark amounts for medical expenses, lost earnings, nursing care, disability compensation, and non-pecuniary damages (e.g., pain and suffering).
Under the Civil Act, anyone who causes harm through unlawful conduct must compensate the injured party for all resulting damages (Civil Act, s. 750 — Liability for Damages). Fault is determined on a percentage basis, and compensation is reduced proportionally if the victim contributed to the accident (Civil Act, s. 763 — Mitigation of Liability).
The Automobile Management Act requires mandatory automobile liability insurance (compulsory P&I insurance) covering up to KRW 15 million per person for bodily injury — this forms the baseline for minimum recoverable compensation (Automobile Management Act, s. 89 — Compulsory Insurance).
Statutory TextAny person who causes damage to another person by an unlawful act shall be liable to compensate for such damage.
— Civil Act, s. 750 — Liability for Damages
Statutory TextIf the victim has also been negligent, the court may reduce or exempt the compensation amount according to the degree of negligence.
— Civil Act, s. 763 — Mitigation of Liability
Statutory TextOwners of automobiles used for passenger or cargo transport shall enter into compulsory insurance contracts covering liability for injury or death caused to passengers or third parties.
— Automobile Management Act, s. 89 — Compulsory Insurance
What to Do
Gather all medical records, diagnosis reports, wage slips, and police accident reports.
File a claim with the at-fault driver’s compulsory auto liability insurer within 3 years of the accident.
Use the latest Supreme Court ‘Traffic Accident Compensation Standards’ to estimate fair compensation for each damage category.
Negotiate settlement using documented losses; if denied or disputed, file a civil claim at the district court.
Sources
Not legal advice. This article is general information based on publicly available sources, written for educational purposes. Laws change and individual situations vary. Consult a licensed attorney in your jurisdiction before acting on anything you read here. Last reviewed: 2026-06-08.