A small-business-dedicated policy-type insurance under the Storm and Flood Insurance Act. It provides indemnity compensation for loss to shop facilities, fixtures and stock from typhoon, heavy rain, flood and earthquake. A government subsidy eases the premium burden.
N2N Insurance Brokerage does not represent any single insurer — it independently represents the client as an FSS-registered broker (Reg. No. 2026-012201). We compare the wordings, rates and service of AIG · Chubb · DB · Hyundai · KB · Meritz to propose the cover and price best suited to your risk. Each insurer's full wording is provided at application and binding.
A small-business-dedicated policy-type insurance under the Storm and Flood Insurance Act. It provides indemnity compensation for loss to shop facilities, fixtures and stock from typhoon, heavy rain, flood and earthquake. A government subsidy eases the premium burden.
| Typhoon | Tropical cyclone with strong wind and heavy rain |
|---|---|
| Flood | River overflow and inland inundation |
| Heavy rain | Inundation from concentrated downpour |
| Strong wind | By maximum instantaneous wind speed |
| High seas | Sea waves |
| Tidal wave | Storm surge and seismic sea wave |
| Heavy snow | Facility loss from snow load |
| Earthquake | Loss from seismic shaking |
| Seismic sea wave | Tidal wave from an earthquake |
| Facilities | Signs, awnings, display stands, interior, electrical equipment and other establishment fixtures |
|---|---|
| Fixtures | Desks, chairs, display cases, refrigerators, POS and other office/business fixtures |
| Machinery | Manufacturing/work machinery and equipment |
| Stock | Goods for sale, raw materials, semi-finished and finished products |
Market shops, stalls, arcades.
Restaurants, hair salons, laundries, convenience stores.
Under 5 regular employees (Small Enterprises Act basis).
Owners in regional storm-flood-risk areas.
| Oct 2016 | Typhoon Chaba — maximum instantaneous wind speed 56.5 m/s |
|---|---|
| Nov 2017 | Pohang earthquake (magnitude 5.4) — damage to many buildings and facilities |
| 5 Sep 2020 | Typhoon Maysak — maximum instantaneous wind speed 40 m/s |
| Flood | Loss from river overflow and inland inundation |
|---|---|
| Heavy rain | Inundation and water damage from a downpour |
| Strong wind | Loss from strong wind of 14 m/s+ maximum instantaneous speed |
| High seas | Establishment loss from sea waves |
| Tidal wave | Loss from storm surge and seismic sea wave |
| Heavy snow | Facility loss from snow load |
| Earthquake | Direct and indirect loss from seismic shaking |
| Seismic sea wave | Tidal-wave damage from an earthquake |
| Insurer | KB (a policy insurance administered by the Ministry of the Interior and Safety) |
|---|---|
| Eligibility | Small-business owners under the Small Enterprises Act (under 5 regular employees, etc.) |
| Limit | Government-notified limit + additional limit by local government |
| Turnaround | Same day – 1 business week from application |
| Premium burden | Government/local-government subsidy → own contribution greatly reduced |
| Channel | Individual consultation with our broker (010-5755-6465) |
If the insured event has already occurred at the time the contract is made, the contract is void. However, where the contract is void due to the company's intent or negligence, or where the company knew or could have known of the nullity before acceptance yet did not refund the premium, the company refunds the premium with interest at the policy-loan rate published by the Korea Insurance Development Institute, compounded annually, for the period from the day after payment to the day of refund.
The specific losses not covered (exclusions) are set out in each insurer's policy wording and product description; on this page, see the “Cover” tab(or the “Losses not covered” section) for the main exclusions. For other cover-specific grounds on which claims are not paid, please refer to the policy wording.
The company provides cover, in accordance with the policy, from the time it accepts the application and receives the first premium. Where the company accepts the application after receiving the first premium with it, cover also begins from the time the first premium was received.
The application must be completed by the policyholder, and the policyholder and the insured must sign it by hand. Failure to sign by hand may result in disadvantages regarding the validity of the contract. On an internet cyber-mall, an electronic signature may be used instead.
The policyholder has the right to be given and have explained the information needed about the product they wish to buy.
The insurer and N2N Insurance Brokerage must explain the important matters of the product to ordinary financial consumers.
When applying, the policyholder, the insured or their agent must disclose truthfully the facts they know regarding the questions in the application (including the questionnaire). Otherwise the claim may be declined or the contract cancelled. Where insurance is taken out by telephone or other means of communication, the duty is performed by answering the seller's questions, which are recorded, without a separate written questionnaire, so answers must be given with particular care.
If, after the contract is made, any of the following arises in respect of the subject-matter insured, the policyholder or the insured must notify the company in writing without delay and obtain endorsement on the policy.
The surrender value is the amount paid if the contract is cancelled early. Unlike bank savings, insurance combines risk protection and savings: part of the premium is paid out as claims to other policyholders who suffer accidents, and part covers the insurer's operating expenses, so the surrender value on early cancellation may be less than the premiums paid, or nil.
Under Article 59-4(1) of the Income Tax Act (special tax credit), for protection-type insurance taken out by an employee only, a tax credit of 12% of the premium paid (capped at KRW 1 million per year) is available. Tax matters may change with amendment or repeal of the relevant tax law.
Except as provided by law, the insurer and N2N Insurance Brokerage do not collect, use, inspect or provide personal data related to this contract — for its conclusion, maintenance and claim payment — without the consent of the policyholder, the insured or the beneficiary. However, for those purposes the insurer may, with the consent of the policyholder and the insured and in accordance with law, provide personal data to other insurers and insurance-related bodies.
The above is a summary and excerpt of the policy wording; for grounds on which claims are not paid and other details, please refer to the policy wording and product description.
Policy-type natural-disaster cover — five areas
Small food and café premises. A facility/fixture natural-disaster loss area.
Convenience stores and general goods. A stock + facility combination area.
Repair shops and small workshops. A machinery + stock combination area.
Service businesses such as hair and laundry. An equipment/facility natural-disaster area.
Areas of high natural-disaster risk — coast, riverside, mountain, low-lying.
A small coastal restaurant suffered inundation damage from heavy rain in the typhoon season. Ordinary fire insurance could not cover it as storm-flood is excluded, but under this policy-type storm-flood insurance the facility, fixture and stock loss was reviewed on an indemnity basis, and with the government/local-government subsidised premium (about 80%) applied, the owner's own contribution was a very low premium. Although the location's high natural-disaster risk grade was an area where ordinary storm-flood insurance might have been declined, the policy-type insurance is an area where subscription is guaranteed under the Storm and Flood Insurance Act, so the cover gap was prevented — a case showing that policy-type storm-flood insurance is a core safety net for disaster-exposed small-business owners.
Source: (General industry example)
The wording and structure points decision-makers most often overlook
Applying the government/local-government subsidised premium requires certification through the procedure of the local government with jurisdiction. Small-business proof (under 5 regular employees, etc.) plus the local-government application must be completed in advance for the subsidy rate to apply; without it, the ordinary storm-flood premium applies.
Unlike fixed-sum compensation, an indemnity wording needs an actual-loss valuation process. Evidence of the pre-accident value of facilities, fixtures and stock (receipts, stock records) and the post-accident loss-assessment process are central to the cover, so systematising records in advance is recommended.
The standard small-business limit may not exceed the establishment's actual asset/stock value. As assets grow with the business, a limit adjustment or a combination with ordinary storm-flood / property-comprehensive insurance should be reviewed, and re-assessing limit adequacy at each renewal is recommended.
The questions decision-makers ask most when considering small-business storm-flood and earthquake insurance
Businesses run by a small-business owner (under the Small Enterprises Protection and Support Act — fewer than 5 regular employees, etc.) are eligible. Establishments exposed to natural-disaster risk — restaurants, cafés, wholesale/retail, repair, hair, laundry — are the core area; as a policy-type insurance under the Storm and Flood Insurance Act, a government premium subsidy applies.
It indemnifies loss to the establishment's facilities, fixtures and stock from natural disasters such as typhoon, flood, heavy rain, strong wind, high seas, tidal wave, heavy snow, lightning and hail. Some wordings also combine earthquake cover — a core wording supplementing the natural-disaster area that base fire insurance excludes.
Under Article 5 of the Storm and Flood Insurance Act, the state and local governments subsidise a substantial part of the premium. The rate varies by establishment location and local government, making this a policy-type insurance where the small-business owner's own contribution is greatly reduced. The exact rate follows the guidance of the local government with jurisdiction over the establishment.
Unlike fixed-sum compensation (a lump sum of an agreed amount), it covers within the policy limit up to the actual loss incurred. As this wording is indemnity-based, cover is assessed by valuing the actual facility/fixture/stock loss and applying the policy limit, so a post-accident loss-assessment process is needed.
Restaurants and cafés, small wholesale/retail shops, repair and workshop businesses, hair and laundry shops, and establishments in natural-disaster-exposed areas (coast, riverside, mountain) are the core area. A combined-wording review is recommended according to the storm-flood risk grade of the location.
As this is a small-business wording, the limit is standardised, so where the establishment's actual asset/stock value exceeds the standard limit, a cover gap arises. A combination with, or conversion to, ordinary storm-flood or property-comprehensive insurance should be reviewed as assets grow.
The insurer assesses it on the natural-disaster risk grade of the location, the establishment scale, the sector, the facility-asset value, and the government/local-government subsidy rate applied. The exact premium and whether cover can be accepted are confirmed by the policy criteria at the time of application and the insurer's guidance.
