Why the system exists
As car ownership boomed, Korea passed the Traffic Accident Special Act in 1981 so ordinary negligent drivers would not all end up with criminal records. If the driver carries comprehensive insurance or the victim does not want punishment, simple negligence is not prosecuted. Twelve grave faults—running a red light, crossing the center line, drunk or unlicensed driving and others—plus hit-and-run and serious injury stay prosecutable. That is why Koreans talk about a separate "criminal settlement." Most disputes settle anyway because both sides price the likely verdict (Priest & Klein, 1984).
Criminal vs insurance settlement
A criminal settlement is negotiated by the driver, often funded by a driver-insurance rider, and yields a no-punishment statement that affects charging and sentencing. The civil settlement, usually with the insurer, fixes medical costs, lost income, consolation money and permanent-disability losses. If talks fail, the driver can lodge a criminal deposit with the court; since 9 December 2022 this works even without the victim's personal details (Deposit Act Art. 5-2), and victims may comment to the court.
How payouts are calculated
Insurance payouts add treatment, lost earnings, consolation money and disability-related income loss, then reduce by your fault ratio, which starts from the insurers' association standards. Claims for damages generally lapse three years after you learn of the harm and the wrongdoer. Restorative-justice research links sincere apology and dialogue to higher victim satisfaction (Strang et al., 2013). See also auto insurance and drunk driving.
Checklist
- Secure dashcam footage, photos and witness contacts, and report to police.
- Settle after treatment ends and any disability is assessed.
- Check whether your driver insurance covers criminal settlement money.
- Put the amount, date, deduction terms and no-punishment wording in writing.
FAQ
- I used insurance. Do I still need a criminal settlement?
- Yes, if the crash involves a grave fault, serious injury, death or fleeing.
- When should I settle?
- After treatment ends and permanent-disability status is clear.
Sources reviewed: 2026-11-09
References
- 교통사고처리 특례법 제3조·제4조. Korea's Traffic Accident Special Act: no prosecution with insurance or settlement, except listed grave faults.
- 자동차손해배상 보장법. Compulsory motor liability insurance and operator liability rules in Korea.
- 공탁법 제5조의2 (형사공탁의 특례). Deposit Act special rule letting defendants deposit compensation without victim identity details.
- 대법원. (2022. 12. 6.). 형사공탁 특례 제도 시행에 따라 관련 규정 및 시스템 정비 [보도자료]. Supreme Court notice on the December 2022 criminal-deposit system and victim notification.
- 손해보험협회. (n.d.). 과실비율정보포털. Insurance association portal on fault-ratio standards by accident type.
- Priest, G. L., & Klein, B. (1984). The selection of disputes for litigation. The Journal of Legal Studies, 13(1), 1–55. Classic model of why most disputes settle before trial.
- Strang, H., Sherman, L. W., Mayo-Wilson, E., Woods, D., & Ariel, B. (2013). Restorative justice conferencing (RJC) using face-to-face meetings of offenders and victims: Effects on offender recidivism and victim satisfaction. A systematic review. Campbell Systematic Reviews, 9(1). Systematic review of restorative conferencing on victim satisfaction and reoffending.