How Are Workplace Health Insurance Premiums Calculated?

Hello everyone! Today, we're diving into the calculation methods and rates for workplace health insurance premiums, a crucial topic for all employees in South Korea. Many of you might be curious about how your monthly health insurance deductions are determined, and we'll also take a look at what changes to expect in 2026.

2026 Workplace Health Insurance Premium Rate

The workplace health insurance premium rate for 2026 has been frozen at 7.09%. This rate is based on the employee's monthly salary amount, and it's structured so that the employee and employer each bear 50% of the cost. This means employees will pay 3.545% of their monthly salary towards health insurance.

Linkage with Long-Term Care Insurance Premiums

In addition to the workplace health insurance premium, the Long-Term Care Insurance premium is also deducted. This premium is equivalent to 12.95% of the health insurance premium and is also split equally between the employee and employer. Many people find this part confusing, but the Long-Term Care Insurance premium is calculated by directly multiplying the amount determined from the health insurance premium.

Calculating Your Own Premium

Now, let's walk through an example to see how this is calculated in practice. For instance, let's consider Mr. A, an employee with a monthly salary amount of 4 million KRW.

• Step 1: Determine the Monthly Salary Amount - We assume Mr. A's taxable monthly salary amount is 4 million KRW.
• Step 2: Calculate the Total Health Insurance Premium - 4,000,000 KRW × 0.0709 = 283,600 KRW
• Step 3: Calculate the Employee's Share of Health Insurance Premium - 283,600 KRW × 0.5 = 141,800 KRW
• Step 4: Calculate the Long-Term Care Insurance Premium - 141,800 KRW × 0.1295 = 18,360 KRW
• Step 5: Total Deduction Amount - 141,800 KRW + 18,360 KRW = 160,160 KRW

As a result, Mr. A will have a total of 160,160 KRW deducted from his salary each month for health insurance-related costs.

Income-Based Monthly Premiums: Points to Note

Additionally, employees with side jobs or investment income beyond their regular salary should be aware of income-based monthly premiums. If your annual income exceeds 20 million KRW, additional premiums will be levied on the excess amount. In this case, the employee must bear the full cost, so it's important to manage your personal finances carefully.

Upper and Lower Limit Systems

Finally, let's touch upon the upper and lower limit systems. The lower limit sets a minimum premium standard, ensuring that even employees with lower incomes contribute a baseline amount. Conversely, the upper limit applies to high-income earners, exempting them from premiums beyond a certain threshold.

In conclusion, the 2026 workplace health insurance premiums are designed to be fair, aligning with the contribution capacity of employees. Make sure your health insurance premiums are being calculated correctly, and check them through the official app if needed!