Informal social networks in Korea: Covering the cost of major life events

• In Korea, Sang-Ho-Bu-Jo served as an informal social insurance for discrete events (such as births, wedding, and deaths).
• Sang-Ho-Bu-Jo is in informal support provided by members’ of one's social network during designated times of need.
• In Korea, 80% of households are participating in this voluntary informal social insurance arrangement.
• Participating households dedicate between 2 and 4% of their household expenditures to Sang-Ho-Bu-Jo.
• Sang-Ho-Bu-Jo it not applicable for long-term needs (such as disability or loss of job).

This article investigates an informal voluntary social arrangement for financial assistance with discrete major life events known in Korea as Sang-Ho-Bu-Jo. This informal voluntary arrangement is neither public nor private, but is based on social networks that produce a unique form of civic society. Sang-Ho-Bu-Jo covers people's transitional one-time needs. This study explores the practice of Sang-Ho-Bu-Jo and its origins and provides the first systematic empirical study of this social phenomenon. Three large databases are used to analyze the scope and level of participation, as well as what variables correlate with such involvement. The study finds a high rate of participation, over 80% of households, and an average investment of 2–4% of household expenditure. Sang-Ho-Bu-Jo can help scholars and policy makers worldwide in understanding the role of socialization, social networks, and social capital in explaining innovative informal methods of social care.