EPS - Employment Permit System

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Four major insurances of the employment permit system

What are the “four major insurances of the employment permit system”?

The “four major insurances of the employment permit system” refers to the four insurance policies (Departure guarantee insurance, guarantee insurance, return cost insurance, and casualty insurance) that foreign workers and their employers must purchase based on “The Act on the Employment of Foreign Workers, Etc”

※ The insurance of the employment permit system is operated separately from the four major social insurances (Employment, industrial accidents, health, and national pension insurance).

Insurance purchasers

Foreign workers

- A foreign worker working or intending to work at a company located in Korea with the purpose of earning wages; and,

- A foreign worker who has the qualification to stay through non-specialized employment (E-9 visa) or visitor employment (H-2 visa).

Employers

- An “employer” means an employer at a company that has employed a foreign worker or foreign workers according to “The Act on the Employment of Foreign Workers, Etc

Insurance Details

Types of insurance	Purchasers of insurance	Main details	Insured Amounts
Departure guarantee insurance	Employers	Insurance purchased at a company with 5 or more regular workers to prepare severance payment	Deposited Amount (100.5% of the principal amount deposited in case the worker has worked for one year or longer without leaving the workplace without permission and 350 days or more have passed since the first payment date of the insurance premium)
Guarantee insurance	Employers	Insurance to guarantee foreign workers against overdue wages	Up to two million won
Return cost insurance	Foreign workers	Insurance to cover the cost of returning to a foreign worker’s home country when he or she leaves Korea	Paid amount (101% of the principal amount deposited in case 30 months or more have passed since the date of the deposit of the insurance premium)
Casualty insurance	Foreign workers	Insurance to cover casualty, disease, or accident other than an occupational accident.	30 million won for injuries/ 15 million won for diseases

Insurances to be purchased by foreign workers

Return cost insurance

1) What is “return cost insurance”?

A foreign worker working or intending to work at a company located in Korea with the purpose of earning wages; and,

※ Date of the effectuation of the employment contract: Date of entry (For E-9 visa holders) or the date of the beginning of the employment contract (For visitor employees with the H-2 visa)

2) Mandatory purchasers

It is mandatory for foreign workers who either have been providing work or intend to provide work at a company in Korea with the purpose of earning wages to purchase the insurance.

Foreign workers having the qualification to stay in Korea for non-specialized employment (E-9 visa)

Foreign workers who have come to Korea with the qualification to stay for visitor employment (H-2 visa), have completed the employment education for getting employed, have become employed after registering for job seeking, and then have reported the beginning of work.

3) Insurance premium

Foreign workers must pay the following announced monetary amount by nationality in a lump sum.

< Amounts Announced by Nationality >

Classification	Country	Announced amount
Category 1	China, the Philippines, Indonesia, Thailand, and Vietnam	400,000 won
Category 2	Mongolia and other countries	500,000 won
Category 3	Sri Lanka	600,000 won

※ Those who fail to purchase the return cost insurance can be punished with a fine for negligence of 800,000 won.

4) Insurance purchasing procedure

After arriving in Korea, foreign workers sign an insurance agreement at an employment education organization and then open up a bank account.

- Documents to be submitted when signing the agreement: 1 copy of the insurance agreement, 1 copy of the agreement for the provision and utilization of personal credit information.

By depositing the return cost insurance premium in the bank account opened up during the employment education before the due date of the payment, the insurance premium gets automatically transferred, and, therefore, the foreign worker gets to purchase the insurance.

< Premium Payment Methods by Qualification of Stay >

Qualification of stay	Due date for payment	Payment method
Qualification to stay for non-specialized employment (E-9 visa)	Within 80 days from entry into Korea	By depositing the return cost insurance premium in the bank account opened up during the employment education, the insurance premium gets automatically transferred.
Qualification to stay for visitor employment (H-2 visa)	Within 80 days from the date of the beginning of the employment contract

Casualty Insurance

1) What is "casualty insurance"?

It is insurance that must be purchased by foreign workers within 15 days from the date of the effectuation of the employment contract in preparation for injuries, diseases, accidents, etc other than occupational accidents

※ Employment contract effectuation date: Date of entry (For E-9 visa holders) or the date of the beginning of the employment contract (For visitor employees with H-2 visa)

※ “Occupational accidents” refers to injuries, diseases, bodily disabilities, or deaths of workers by any job-related causes and shall be applicable to the criteria of the “occupational accidents” in Number 1, Article 4 of the Industrial Accidents Compensation Insurance Law.

2) Mandatory Purchasers

It is mandatory for foreign workers who either have been providing work or intend to provide work at a company in Korea with the purpose of earning wages to purchase the insurance.

Foreign workers with the qualification to stay for non-specialized employment (E-9 visa)

Foreign workers who have come to Korea with the qualification to stay for visitor employment (H-2 visa), have completed the employment education, have become employed after registering for job seeking, and then have reported the beginning of work.

3) Insurance Premium

Foreign workers must purchase the insurance that guarantees the monetary amount of the insurance purchase below:

- Insurance premium varies depending on the individual’s age and sex and the time period of the insurance.

※ The insurance premium by individual is indicated on the Insurance Agreement

< Announced amounts by coverage >

Coverage	Announced Amount
Death from injury/Permanent disability	A maximum of 30 million won
Death from disease/Severe permanent disability	15 million won

4) Insurance Purchasing Procedure

Foreign workers sign the insurance agreement at the employment education organization and open up a bank account.

- Documents to be submitted when signing the agreement: 1 copy of the insurance agreement, 1 copy of the agreement for the provision and utilization of personal credit information.

By depositing the casualty insurance premium in the bank account opened up during the employment education before the due date of the payment, the insurance premium gets automatically transferred, and, therefore, the foreign worker’s purchase of the insurance gets completed.

※ The casualty insurance premium must be paid in a lump-sum with the time period of the insurance being until the date of the expiration of the qualification to stay. It must be paid in the Korean won currency.

※ The remaining casualty insurance premium is refunded when the foreign worker departs Korea before the expiry of the casualty insurance (3 years).

Others

Departure guarantee insurance must be subscribed by employers. The worker can check whether or not the employer has purchased the insurance by being issued a duplicate copy of the departure guarantee insurance agreement possessed by the employer after the employer purchases the insurance.

Workers can check whether the employer has purchased the insurance at the Samsung Fire and Marine Insurance Co., Ltd. website (foreign.samsungfire.com) or through the ARS (02-2119-2400).

Insurance benefits to be claimed by foreign workers

Departure guarantee insurance

- Departure guarantee insurance is mandatory insurance to be purchased by employers at a company with five or more regular workers who have employed a foreign worker with the remaining employment time period of 1 year or longer.

- The employer pays severance allowance to foreign workers when they resign by accumulating, every month, 8.3% of their average monthly wages as indicated in the Employment Permit Certificate

1) Reasons for payment of claim

When a foreign worker who has worked for one year or more at a company with five or more regular employees has completed his/her employment contract without leaving the workplace without permission.

※ Foreign workers with the qualification to stay for visitor employment (H-2 visa) employed by construction companies are not eligible to claim the departure guarantee insurance.

2) Claim procedure

When foreign workers depart Korea

- When a foreign worker who has worked for 1 year or longer without leaving the workplace without permission leaves Korea, he or she must report the planned date of the departure to the Job Center.

- And then the foreign worker can file the claim with the Human Resources Development Service of Korea (Head office) or Samsung Fire and Marine Insurance Co., Ltd.

※ Document to be submitted: 1 copy of the Certificate of Departure Schedule

※ Foreign workers must submit the Application for Departure Schedule to the Job Center at least one month prior to the scheduled departure date and then they will be issued the Certificate of Departure Schedule

When foreign workers change their employers

- When a foreign worker who has worked 1 year or longer without leaving the workplace without permission changes the employer, he or she may submit the Change of Employer Notification Form to the Job Center.

- And the foreign worker can file the claim with the Human Resources Development Service of Korea (Head office) or Samsung Fire and Marine Insurance Co., Ltd.

※ The foreign worker should submit his or her Application for Change of Workplace to the Job Center within one month after the termination of the employment contract with his or her previous employer.

Documents required in claim

- 1 copy of the Application Form for Insurance Claim (Available at the Job Center or on the website), 1 copy of the bankbook in the foreign worker’s name, 1 copy of identification certification (Passport or Certificate of Alien Registration Card)

3) Payment of Claim

The insurer (Samsung Fire & Marine Insurance Co., Ltd.) pays the monetary amount accumulated by the employer to the foreign worker in a lump sum after checking the reason for the payment of the claim.

- When the insurance benefit falls short of the minimum severance allowance under the Labor Standard Act, the foreign worker may claim the difference directly to the employer.

< Insurance Benefit by Reasons of Claim >

Reasons of Claim	Insurance Benefit
When a foreign worker has worked for less than one year or left the workplace without permission	Principal sum of monthly paid amount (When less than 350 days have passed since the first payment date of the insurance premium)
When a foreign worker has worked at the same workplace for one year or longer without leaving the workplace without permission	100.5% of the principal sum of the monthly paid amount (When 350 days or more have passed since the first payment date of the insurance premium)

※ If the foreign worker is not eligible to make the claim (When having left the workplace without permission, when having worked for less than 1 year, etc), the benefit is paid to his/her employer.

※ When the foreign worker is returning to his/her home country, the insurance benefit of the return cost insurance is paid at the same time.

※ In case of the foreign worker’s death, the insurance benefit (Departure guarantee, return cost, or casualty insurance) is paid to his/her bereaved family.

※ “Bereaved family” refers to the inheritor recognized by the concerned government organization of the country of the insurance beneficiary or the insured person.

Guarantee Insurance

- It is mandatory insurance to be purchased by employers hiring less than 300 regular employees in preparation against overdue wages to foreign workers.

- This insurance guarantees the payment of overdue wages of up to 2 million won to the foreign workers when the employer fails to pay wages.

1) Reasons for Payment of Claim

When an employer hiring less than 300 regular employees (Including housekeeping service) fails to pay a wage.

2) Claim procedure

The foreign worker notifies the Ministry of Labor (Labor Affairs Supervision Division or nearby Job Center) of the fact that his/her wage is unpaid.

In case it has been confirmed that wage has been unpaid because of the cancellation of the employment permit or a change of the employer, the foreign worker can file a claim with the Human Resources Development Service of Korea (Head office) or Seoul Guarantee Insurance Co., Ltd.

3) Payment of claim

The insurance company (Seoul Guarantee Insurance Co., Ltd.) pays the unpaid wages to the foreign worker within the guarantee limit after confirming the fact of the unpaid wages and the unpaid amount.

Return cost insurance

- Return cost insurance is insurance purchased by a foreign worker in preparation for the costs of returning to his or her home country. It is paid to the foreign worker when a reason for leaving Korea occurs.

1) Reasons for payment of claim

When the foreign worker departs Korea because of the following reasons:

- When he/she intends to depart Korea because his/her sojourn period has expired;

- When he/she intends to depart Korea for personal reasons before the expiry of his/her sojourn period (Excluding temporary departures); or

- When he/she has left his/her workplace without permission and intends to voluntarily leave Korea or is deported by the government of Korea.

2) Claim procedure

The foreign worker files claim with the Human Resources Development Service of Korea (Head office) or Samsung Fire and Marine Insurance Co., Ltd. after notifying his/her scheduled departure date to the Job Center.

3) Payment of Claim

The insurer (Samsung Fire & Marine Insurance Co., Ltd.) sends the insurance benefit to the foreign worker’s bank account before the planned date of his/her departure.

< Insurance Benefit by Insurance Period >

Insurance Period	Insurance Benefit
30 or more months from the date of deposit	101% of the paid premium
Less than 30 months from the date of deposit	Principal sum of the paid premium

※ In the case of the foreign worker’s death, the insurance benefit is paid to the bereaved family.

Casualty insurance

- It is insurance to compensate for foreign workers’ injuries, diseases, deaths, or permanent disabilities, excluding occupational accidents.

1) Reasons for Payment of Claim

The insurer (Samsung Fire & Marine Insurance Co., Ltd.) sends the insurance benefit to the foreign worker’s bank account before the planned date of his/her departure.

※ The insurance does not cover injuries caused by the foreign worker’s intentional acts, suicide, mental illness, pregnancy, baby delivery, and criminal punishment or losses caused by natural disasters, war, and dangerous club activities. (For detailed information, please refer to the websites of the Human Resources Development Service of Korea and Samsung Fire & Marine Insurance Co., Ltd.)

2) Claim Procedure

In case the foreign worker has died or has been disabled due to a reason other than occupational accident, the foreign worker or his/her bereaved family can file a claim with the Human Resources Development Service of Korea (Head office) or Samsung Fire & Marine Insurance Co., Ltd.

- Documents required when filing a claim: 1 copy of the Application Form for Insurance Claim (Available at the Job Center or on the website), 1 copy of the bankbook in the foreign worker’s name, 1 copy of identification certification (Passport or Certificate of Alien Registration Card), a document verifying the accident (Doctor’s death certificate or disability diagnosis certificate), a bereaved family certificate, a copy of the bankbook in the name of a member of the bereaved family (In case the foreign worker has died).

※ If it is difficult for the bereaved family to claim the insurance benefit directly, the Human Resources Development Service of Korea makes the claim on behalf of the bereaved family and pays the benefit to the bereaved family.

3) Payment of Claim

The insurance company (Samsung Fire and Marine Insurance Co., Ltd.) pays the insurance benefit to the foreign worker (Or his/her bereaved family) after investigating the accident and the result of the investigation pertains to a reason for payment.

※ The insurance benefit is paid within the limit of 30 million won for death from an injury (Or permanent disability) and 15 million won for death from a disease (Or severe permanent disability) other than occupational accidents.