Background: Precautionary allergen labeling (PAL) is mandatory and legally regulated in Korea. This study aims to investigate the frequency of PAL use in food products, evaluate its competence, and seek direction for improvement. Methods: Cow’s milk (CM) and hen’s egg white (EW) protein concentrations were measured using an enzyme-linked immunosorbent assay (ELISA). The results validated PAL using the Voluntary Incidental Trace Allergen Labeling® 3.0 program. A survey was conducted on guardians to compare preferences and understanding of the current and the arbitrarily revised PAL. Results: PAL was used in 91.8% (280/305) of baby food products. ELISA results using randomly selected baby food products showed that only 16.7% (5/30; No PAL with no contamination, n = 4; PAL with real-contamination risk, n = 1) were validated to PAL. A detectable CM was found in two products (2/26, 7.7%), with one product exceeding the reference dose (10.3 ± 0.17 ppm). EW was not detected at all (0/16). A total of 207 surveys from guardians were collected and categorized into three groups: food allergy (FA, n = 103), diseases other than food allergies (Others, n = 52), and no disease (Control, n = 52). The FA group exhibited the highest frequency of checking food allergen labeling (“always”: 78.6%, “often”: 9.7%), with a similar PAL adherence (“always”: 58.3%, “often”: 10.4%). None of the groups were satisfied with the current PAL. The ‘allergen-free’ statement was mostly preferred across all groups. The FA group notably preferred PAL with concentration statements. Conclusion: PAL is excessively prevalent and insufficient in ensuring the safety of children with FAs, necessitating a revision towards a more patient-friendly, evidence-based system for affected individuals and their families.