KIM&CHANG
Newsletter | November 2015, Issue 3
INSURANCE
Financial Regulators Establish a Joint Initiative to Improve Insurance Sales Channels
On August 27, 2015, the Financial Services Commission (“FSC”) published a press release, announcing a joint initiative (the “Initiative”) with the Financial Supervisory Service (“FSS”), entitled “Step-by-Step Measures to Improve Sales Channels for Insurance Products” (the “Press Release”).
According to the Press Release, the supervisory authorities will coordinate to improve insurance sales channels through the Initiative in the following three phases:
(1) Promote self-improvement efforts by the industry;
(2) Strengthen regulations concerning improper conduct that disrupts the insurance market system, and
(3) Implement a complete overhaul of the insurance sales channel system.
Specifically, the Initiative seeks to:
(1) Realize the insurance industry’s self-improvement efforts through a voluntary agreement made in September 2015 to eradicate improper conduct in the insurance market, including excessive competition, and unfair sales practices by introducing a standardized consignment agreement for insurance agents;
(2) Amend the relevant supervisory regulations to support the insurance industry’s efforts to eradicate improper conduct in the market, and based on research projects, identify mid-to-long-term action items to be accomplished by the end of 2015; and
(3) Pursue fundamental and systematic improvements through 2016 (e.g., amendments to the Insurance Business Act, its subordinate regulations, and other relevant laws and regulations).
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If you have any questions regarding this article, please contact below:
Woong Park
wpark@kimchang.com
Young Hwa Paik
yhpaik@kimchang.com
Gene Lee
gene.lee@kimchang.com
For more information, please visit our website:
www.kimchang.com Insurance Practice Group