Complaints about improper sales filed with the Financial Supervisory Service are increasing as cases grow of selling whole life policies that pay benefits upon death as if they were investment products.
The Financial Supervisory Service on the 16th issued guidance on cautions for whole life insurance, saying that recommendations and sign-ups for whole life policies unsuitable for savings or building a lump sum are taking place at events such as one-day classes for making cake and Dubai jjondeuk cookie. After receiving a winning text message for a Dubai jjondeuk cookie class and visiting, customers are encouraged to enroll in whole life insurance by comparing it with time deposits and savings accounts.
Whole life insurance was also being sold as if it were a savings-type policy at baby fairs and wedding expos, in-house corporate training sessions, and Nonghyup and Suhyup cooperative branches. Parents visiting baby fairs are told to use whole life insurance to prepare for their children's education costs, and in in-house corporate training, they are advised to use whole life insurance for tax saving and inheritance purposes.
The Financial Supervisory Service (FSS) noted, "Whole life insurance is designed to promote the financial stability of families by paying benefits to survivors when the subscriber (insured) dies, and it is not suitable for the subscriber's own purposes such as saving, using funds, or preparing for retirement." It also said, "If improper sales are suspected, such as when enrollment occurs without a correct understanding of the product details, it is necessary to retain materials such as the explanatory documents received, call recordings, text messages, and KakaoTalk messages to prepare to prove improper sales."