Is car rental insurance mandatory in Korea?

Basic liability insurance is mandatory and included in every rental. CDW (covering damage to the rental car) is technically optional but strongly recommended. At Lotte Rent-a-Car, zero-deductible CDW is actually mandatory for all foreign customers, so you'll have full coverage automatically.

What does CDW cover in Korean car rentals?

CDW (Collision Damage Waiver) covers damage to the rental vehicle itself in case of collision or accident. With standard CDW, you pay a deductible of ₩200,000-500,000 per incident. With Super CDW, the deductible drops to zero for domestic vehicles. CDW does not cover tires, windshield, interior damage, or NOC fees.

What are NOC fees and can I avoid them?

NOC (Non-Operation Charges) are business loss fees you pay while the car is being repaired. Calculated at 50% of the daily rental rate times repair days. No insurance covers NOC. You can only avoid them by not damaging the car. A minor scrape needing 3-5 repair days typically costs ₩120,000-200,000 in NOC.

Does my credit card cover rental car insurance in Korea?

Major credit cards (Visa, Mastercard, Amex) offer international rental coverage that applies in South Korea. However, Korean rental companies won't waive their own CDW based on your card. Credit card coverage works as backup, covering collision damage, but won't cover NOC fees, tires, or liability.

Do I need an IDP to be covered by rental car insurance in Korea?

Yes. Without a valid International Driving Permit (IDP), all insurance coverage is void. If you rent a car without an IDP and have an accident, you're personally liable for everything. Your IDP must be issued within the past year and from a Geneva or Vienna Convention signatory country.

How much does car rental insurance cost per day in Korea?

For an economy car, standard CDW adds ₩10,000-20,000/day and Super CDW adds another ₩15,000-20,000/day on top. Total insurance cost ranges from ₩25,000-40,000/day depending on vehicle class. Major companies include basic liability in the base rental rate at no extra charge.

What happens if I damage the rental car's tires or windshield?

Tire, wheel, windshield, and roof damage are typically excluded from CDW coverage. You'll pay the full repair or replacement cost out of pocket, plus NOC fees for repair time. Drive carefully in parking garages (watch for roof clearance) and stay alert for road debris on highways.

What's the drunk driving limit in Korea for rental cars?

Korea's legal BAC limit is 0.03%, roughly half of most Western countries. Even one drink can put you over. Driving under the influence completely voids all insurance coverage. You'd be liable for all damages, face criminal charges, and potentially jail time. Simply don't drink if you're driving.

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Korea Car Rental Insurance: What Foreigners Need

By Koro Team·9 min read·March 8, 2026

In This Article

Every rental car in Korea comes with basic liability insurance covering third-party injuries and property damage. But it does not cover damage to the rental car itself. For that, you need CDW (Collision Damage Waiver), and upgrading to Super CDW with zero deductible costs around ₩15,000-20,000 extra per day. At major companies like Lotte Rent-a-Car, the zero-deductible option is actually mandatory for foreign renters.

What Insurance Comes Standard with Korean Rentals

All rental cars in South Korea include mandatory liability insurance as required by the Guarantee of Automobile Accident Compensation Act. This baseline coverage is built into your rental rate at no extra cost. You don't need to add it or ask for it.

The standard coverage at major companies like Lotte Rent-a-Car includes: third-party bodily injury coverage up to ₩150 million per person (for death or serious injury), third-party property damage up to ₩20 million per accident, and passenger injury coverage up to ₩15 million per person. Some companies offer unlimited third-party liability for bodily injury, which exceeds the legal minimums.

Here's the catch that surprises most renters: this basic insurance does NOT cover damage to the rental car you're driving. If you back into a pole, scrape a guardrail, or get rear-ended at a traffic light, you're personally responsible for the full repair cost of the vehicle unless you've purchased CDW.

Insurance policy document with magnifying glass and toy car representing car rental coverage — Basic liability insurance is included, but damage to the rental car itself requires separate CDW coverage.

CDW vs Super CDW: Which One Do You Need?

Standard CDW (Collision Damage Waiver)

CDW isn't technically insurance. It's a waiver where the rental company agrees to cover damage to their vehicle above a certain deductible amount. With standard CDW, if you damage the car, you pay the deductible and the rental company covers the rest of the repair bill.

The typical deductible with standard CDW ranges from ₩200,000 to ₩500,000 per incident, with ₩300,000 being the most common. So if you get a dent that costs ₩800,000 to fix, you'd pay ₩300,000 and the rental company covers the remaining ₩500,000. CDW typically adds ₩10,000-30,000 per day to your rental cost depending on the vehicle class.

Super CDW (Zero Deductible)

Super CDW eliminates the deductible entirely for domestic vehicles. That same ₩800,000 dent? You pay nothing for the repair. It costs roughly ₩15,000-20,000 per day more than standard CDW. For a week-long rental, that's about ₩105,000-140,000 extra total.

For imported or luxury vehicles (BMW, Mercedes, etc.), a ₩300,000 deductible may still apply even with Super CDW. If you're renting a domestic brand like Hyundai, Kia, or Genesis, Super CDW should bring your deductible to zero.

Important for Foreigners

At Lotte Rent-a-Car (Korea's largest, also the Hertz partner), the zero-deductible option is mandatory for all foreign customers. You'll be enrolled automatically. This actually works in your favor since it ensures you have maximum vehicle damage coverage.

Person signing a rental car insurance contract document with a pen — Always read the insurance terms at the counter. Ask specifically about the deductible amount and what's excluded.

The Hidden Cost: NOC Fees Nobody Warns You About

This is the biggest gotcha in Korean car rental insurance, and most travel guides skip over it entirely. NOC stands for Non-Operation Charges, also called "business loss fees" or "loss of use fees." It's compensation you pay the rental company for the revenue they lose while the car is in the shop being repaired.

NOC is calculated as 50% of the standard daily rental rate multiplied by the number of repair days. Example: you rent a car at ₩80,000/day and cause damage that takes 10 days to fix. Your NOC fee is ₩80,000 × 50% × 10 days = ₩400,000. For a total-loss vehicle where repair costs exceed 50% of the car's value, the fee jumps to 50% of a 60-day rental rate.

The critical thing to understand: neither CDW nor Super CDW covers NOC fees. No level of insurance from the rental company waives this charge. Even with zero-deductible coverage, if you damage the car, you will pay NOC on top of everything else. A minor parking lot scrape might only need 3 days of repair (NOC: ₩120,000 on an ₩80,000/day car), but a serious collision requiring 2-3 weeks could mean NOC fees of ₩500,000 or more.

Budget for the Worst Case

Even with Super CDW, budget a worst-case ₩300,000-500,000 for potential NOC fees. A minor fender-bender with 5 days of repair on a standard car runs about ₩200,000 in NOC. This is the one cost no insurance can eliminate.

What's Not Covered (Even with Full Insurance)

Even the most comprehensive insurance package in Korea has exclusions. Knowing these upfront can save you from expensive surprises at the return counter.

Tires, Windshield, and Roof

Damage to tires, wheels, windshield, and roof is typically excluded from CDW coverage. A blown tire from a pothole, a cracked windshield from a rock on the expressway, or roof damage from a low-clearance parking garage all come out of your pocket. Drive carefully in parking structures and stay alert for road debris.

Underbody and Interior Damage

Chassis and underbody damage is generally not covered under standard CDW. This matters on Jeju Island where some scenic routes have uneven roads. Interior damage like cigarette burns, food stains, or broken trim pieces are also your responsibility.

Close-up of damaged yellow car front bumper and headlight showing collision damage — CDW covers body panel damage like this, but tires, windshield, and underbody damage are typically excluded.

Drunk Driving Voids Everything

Korea has one of the strictest drunk driving limits in the world: 0.03% BAC, roughly half of what most Western countries allow. Even one beer can put you over the limit. If you're caught driving under the influence, every single type of insurance coverage is voided. You'll be personally liable for all damages, face criminal prosecution, and potentially lose your ability to rent in Korea again. The rule is simple: if you're driving, don't drink at all.

Off-Road and Restricted Areas

Accidents on non-standard roads, sandy beaches, flooded areas, or certain ferry islands (like Udo Island or Marado Island off Jeju) may not be covered by any insurance. These are considered driver-fault situations where you assumed the risk by driving in an unauthorized area.

What to Do If You Have an Accident

If you're in an accident, stay calm and follow this order. First, stop immediately and turn on your hazard lights. Leaving the scene is a criminal offense in Korea, even for minor incidents. Check everyone for injuries and call 119 (fire/ambulance) if anyone is hurt.

Next, call 112 (police). When you call, a Korean-speaking officer will answer. Don't hang up if you hear a beep or wait signal; you'll be connected to an English interpreter. Take photos of both vehicles, the road, and all damage from multiple angles before anything moves. Exchange contact information and insurance details with the other party.

Then call your rental company's 24-hour hotline to report the accident. They'll guide you on next steps, whether that's waiting for a tow truck, driving to the nearest branch, or arranging a replacement vehicle. Keep all receipts and paperwork. Seek medical attention within 48 hours even if injuries seem minor, as some symptoms appear later.

Emergency Numbers to Save

Police: 112 (interpreter available). Fire/Ambulance: 119. Tourist Helpline (English): 1330. Save these in your phone before you start driving. The 1330 tourist helpline can also help translate in emergency situations.

Red Genesis GV80 SUV driving on a Korean highway with guardrails and winter trees — Korean highways are well-maintained, but keep emergency numbers saved in your phone before hitting the road.

Real Cost Breakdown: What You'll Actually Pay

Economy Car (Hyundai Avante / Kia K3)

Base rental: ₩50,000-80,000/day. Standard CDW with ₩300,000 deductible: add ₩10,000-20,000/day. Super CDW upgrade to zero deductible: add another ₩15,000-20,000/day. Total with Super CDW: roughly ₩75,000-120,000/day. For a 5-day Jeju trip, expect ₩375,000-600,000 total with full insurance.

Mid-Size SUV (Hyundai Tucson / Kia Sportage)

Base rental: ₩80,000-150,000/day. Standard CDW: add ₩15,000-30,000/day. Super CDW upgrade: add another ₩15,000-25,000/day. Total with Super CDW: roughly ₩110,000-200,000/day. For a 5-day trip, that's ₩550,000-1,000,000 total. Peak season (July-August, Chuseok) can push prices 50-100% higher.

Pro Tip

Book through English-friendly platforms like Klook, KKday, or Trazy for clearer insurance terms. Booking through international sites like Kayak or Trip.com may show lower base rates, but make sure insurance is included. Lotte Rent-a-Car's English website (lotterentacar.net) is the most transparent about foreigner insurance requirements.

Our Recommendation: What to Buy

Aerial view of a large car rental lot with rows of vehicles available for rent — Stick with major rental companies like Lotte or SK for the most transparent insurance terms and English-speaking staff.

Get Super CDW with zero deductible. Period. The ₩15,000-20,000 per day cost is worth every won for the peace of mind alone. Korea's narrow parking spots, aggressive highway driving, and unfamiliar road signage mean even careful drivers occasionally get scratches or minor dings. With Super CDW, those become non-issues instead of stressful financial disputes at the return counter.

Stick with major rental companies. Lotte Rent-a-Car and SK Rent-a-Car have the clearest insurance terms for foreigners and English-speaking staff at major airport locations. Budget Jeju operators may offer tempting rates, but travel forums are full of stories about limited coverage and surprise charges from smaller companies.

Don't rely on credit card insurance alone. While Visa, Mastercard, and Amex offer international rental coverage, Korean companies generally won't waive their own CDW based on your card. Your card's coverage can serve as useful backup for gaps, but it shouldn't replace purchasing CDW from the rental company. And no credit card covers NOC fees.

Before you drive off, walk around the car with the rental agent and photograph every existing scratch, dent, and mark. Record a short video walking around the entire vehicle. Get the agent to acknowledge any pre-existing damage on the rental agreement. This five-minute ritual protects you from being charged for someone else's mistakes and gives you clear evidence if there's ever a dispute.

One final tip: make sure your International Driving Permit is valid. Without an IDP, all insurance coverage is void, meaning you'd be personally liable for everything in an accident. Your IDP must be issued within the past year from a Geneva or Vienna Convention signatory country, and you must carry your original home country license alongside it. For the complete checklist, see our guide on first-time driving in Korea.