[Data] The view of the Fair Trade Commission at the Government Sejong Complex in Sejong City. /Courtesy of News1
[Data] The view of the Fair Trade Commission at the Government Sejong Complex in Sejong City. /Courtesy of News1

The Fair Trade Commission and the Korea Consumer Agency recently said on the 27th that cases of funeral service companies combining funeral services with electronic products and selling them while failing to provide sufficient contract information are on the rise, issuing a 'damage prevention advisory' regarding combined funeral products.

According to the Fair Trade Commission, the total number of consultations related to funeral services received by the 1372 Consumer Counseling Center over the past three years was 8,987. The number of damage relief cases reported to the Consumer Agency is 477, indicating that consumer damage related to funeral services continues to occur steadily.

The Fair Trade Commission explained that when consumers sign up for funeral services, many rely solely on the seller's verbal explanation claiming that expensive electronic products are provided as gifts or that the full amount will be refunded upon maturity, only to face excessive penalties when canceling the contract.

According to the Fair Trade Commission, Mr. A signed a contract with a business after seeing an advertisement on social media claiming it was a savings-type product that included electronic products (Apple Watch + AirPods Pro) as gifts. However, upon checking the contract, he realized too late that the provided electronic products were not gifts but part of a combined funeral product that required payments over 200 months to receive the principal. When Mr. A demanded the contract be canceled, the business demanded an expense of 3 million won for the electronic products.

Ms. B signed a contract with a funeral company in September 2021, agreeing to pay 59,000 won monthly for 167 payments, with the condition that she would receive her principal amount back upon maturity, and received a dryer as a gift. However, after the company recently went out of business and she requested a refund of her payments, the business refused, stating that the dryer provided at the time of signing was included in the contract.

In response, the Fair Trade Commission and the Consumer Agency advised that consumers should not be misled by terms like 'gift' or 'savings' when joining funeral services, should verify whether there are separate contracts besides the funeral contract, should carefully check the main contract details such as payment amounts and terms, and should confirm the ratio and timing of refund payments when canceling a contract to prevent similar damages.

A Fair Trade Commission official noted, 'The Fair Trade Commission and the Consumer Agency will work together to closely monitor the status of combined funeral products and actively strive to protect consumers in the prepaid installment transaction sector.'