The Financial Supervisory Service imposed sanctions on Heungkuk Life Insurance. The reason was violations of obligations to ensure the safety of electronic financial transactions and the improper inquiry of personal credit information.
On Feb. 6, the Financial Supervisory Service (FSS) said it issued an institutional warning and fines of 124 million won to Heungkuk Life Insurance on Feb. 4. It also gave a reprimand-equivalent sanction to the executive in charge.
Heungkuk Life Insurance was found to have caused eight system errors by conducting inadequate testing in the process of developing computer programs. This led to excessive premium withdrawals (130 million won), delays in insurance claims, and login access failures. It also caused a total of three system errors by omitting the approval process by a responsible manager during premium calculation and automatic transfer, which in turn resulted in excessive premium withdrawals and delayed payments.
While testing for the purpose of developing computer programs, Heungkuk Life Insurance was found to have used users' resident registration numbers stored in databases (DB) without transforming them into an unidentifiable form. It also improperly used personal credit information. Eight Heungkuk Life Insurance employees, without obtaining customer consent, improperly inquired into and used 17 items—including names, resident registration numbers, and contact information—for purposes other than financial transactions.
Heungkuk Life Insurance also granted all employees the authority to query screens that display customers' personal credit information. Despite making 461,550 inquiries into personal credit information, it did not record the purpose of those inquiries, and it stored 106,474 customer resident registration numbers without encryption.
The Financial Supervisory Service (FSS) imposed sanctions after determining that Heungkuk Life Insurance violated the Electronic Financial Transactions Act and the Credit Information Act.