Lee Chan-jin, the head of the Financial Supervisory Service, said on the 1st, "I will fundamentally improve the rampant issues in the insurance market, such as excessive insurance sales commissions and large settlement support funds exchanged for recruiting agents, as well as poor internal controls and unhealthy sales practices. I will hold not only the actors accountable but also the management."
On the same day, Lee met with the chief executives (CEOs) of 16 major insurance companies at the Seoul Gwanghwamun Life Insurance Education and Cultural Center, pointing out the excessive competition for short-term performance in the insurance industry. Lee noted, "I will actively support the establishment of market order by swiftly promoting system improvements such as the restructuring of the sales commission system and the introduction of 'third-party risk management guidelines.'"
Lee emphasized consumer protection once again, stating, "The perception that it is easy to purchase insurance but difficult to receive insurance payouts has not changed significantly." He cited examples of misdesigned insurance products, such as short-term whole life insurance that returns 120-130% of the premiums paid if the contract is canceled early, and disease and injury insurance that offers more coverage than actual medical costs.
Lee stated, "Insurance products that cause consumer harm due to incomplete sales and cover treatment costs that are not medically essential can distort the medical system, leading to the deterioration of health insurance finances and increasing the burden of medical costs for the public, as well as inducing overmedicalization." He urged for the strengthening of a proactive consumer protection system.
Lee mentioned that while maintaining the basic direction to extend the final observation maturity to 30 years, he will adjust the timing of the expansion and will consider a soft landing plan, given that the basic capital solvency ratio (KIS) has been difficult to expand in the short term. However, he emphasized that he would establish a 'duration gap' standard to maintain a stable interest rate risk management policy.