Life insurance company "Unfair Seung-hwan" caught...a hefty fine

Financial authorities have caught a number of life insurance companies doing "unfair Seung-hwan" that requires consumers who have already subscribed to insurance to transfer to similar other insurance policies before the expiration of existing insurance.

The Financial Supervisory Service imposed a fine of 4.46 billion won on nine life insurers, including Samsung Life Insurance, Mirae Asset Life Insurance, Hanwha Life Insurance and Dongyang Life Insurance.

Samsung Life Insurance was fined 2 billion won for unfairly extinguishing existing insurance contracts while recruiting 114 life insurance contracts for two years from March 2019.

Mirae Asset Life Insurance will pay 920 million won, Hanwha Life Insurance will pay 760 million won, and Dongyang Life Insurance will pay 360 million won.

In addition, Samsung Life Insurance was sanctioned for violating its duty of explanation, such as distorting important matters when selling financial investment products, including institutionalism and salary cuts for five executives and employees.