South Korean financial authorities have cracked down on corporate insurance general agencies (GAs) engaged in illegal practices of paying insurance premiums on behalf of policyholders.
The Financial Supervisory Service (FSS) recently handed down business suspensions of 30 to 60 days to 10 insurance planners affiliated with Samsung Life Insurance GA, according to financial sector sources on 16 February, reported Polinews Korea.
The sanctioned agents provided KRW104.6m ($78,000) in unauthorized benefits to 112 policyholders by paying premiums on their behalf across 242 life and non-life insurance contracts.
The initial premiums for these policies totalled KRW54.8m.
The FSS also issued an institutional warning and fined GA Global Financial Sales KRW99.9m. Additionally, 62 of the firm's insurance planners received business suspensions, while nine others were fined between KRW1.8m and KRW50m.
The FSS said it will tighten oversight of GAs and insurance planners following the enforcement action. "Illegal rebate practices such as advance premium payments are serious violations that undermine the sound order of the insurance market," the regulator stated.