Insurance consultants are required to record when consulting on investment-linked insurance.

Recently, the Government issued Decree 46 detailing the implementation of a number of articles of the Law on Insurance Business. Immediately after that, the Ministry of Finance continued to issue Circular 67, guiding the implementation of a number of new points in Decree 46.

In the new regulations related to life insurance business, the Government and the Ministry of Finance have put forward a number of new requirements when selling insurance through banks or consulting on investment-linked insurance products. This is to overcome some recent shortcomings related to the "scandals" in consulting and selling life insurance.

Mr. Ngo Viet Trung - Director of the Department of Insurance Management and Supervision, Ministry of Finance said that Circular No. 67 and Decree No. 46 have just been issued, contributing to the continued completion of the system of legal documents on insurance business activities. In particular, Circular No. 67 has many regulations to improve the quality of insurance consulting in general and insurance consulting through credit institutions and foreign bank branches in particular.

Insurance consultants are required to record when giving insurance advice. Link to image 1 — Mr. Ngo Viet Trung - Director of the Department of Insurance Management and Supervision.

Avoid consultants "forcing" customers to participate in insurance products that do not meet their needs.

+ Circular 67 has introduced a number of new regulations to improve the quality of insurance agents' operations during the process of consulting and concluding insurance contracts. So, what are those new regulations, sir?

- Circular No. 67 has added a number of new regulations compared to the current ones. In particular, it provides many groups of regulations that create a foundation for new market activities, in line with the world 's development trends.

Specifically, this Circular stipulates the application of information technology in insurance business activities; detailed regulations on insurance types and operations; regulations on information disclosure; regulations on strengthening management and supervision of insurance business activities...

In particular, Circular No. 67 contains many important contents to implement the direction of the National Assembly, the Prime Minister, and the Minister of Finance in improving the quality of insurance agency activities, focusing on depth rather than breadth, such as: regulations on enhancing transparency in agency activities, especially agency activities through credit institutions and foreign bank branches.

For example, regulations require that each branch and transaction office of a credit institution must set up a separate transaction counter to conduct insurance agency activities, separate from other business areas of the credit institution.

Or the regulation requires insurance agents to record the insurance consultation process for insurance products such as investment-linked insurance products. Because this is a rather complicated product, with high requirements for awareness and finance of participants.

We want to improve the quality of consulting, avoiding consultants "forcing" customers to participate in insurance products that do not suit their needs and financial capabilities.

At the same time, during the insurance product consultation process, insurance agents, or employees in the agency organization directly performing insurance agency activities must provide complete and accurate information about insurance products to the insurance buyer through documents developed and provided by the insurance company.

Circular 67 also stipulates that banks operating as agents must clearly advise customers that insurance products distributed through credit institutions are not products of the credit institution and that participation in insurance products is not a mandatory condition for using other services and products of the credit institution.

Credit institutions are not allowed to advise, introduce, offer, or arrange the conclusion of investment-linked insurance contracts for customers within 60 days before and after 60 days from the date of disbursement of the entire loan.

To strengthen the responsibility of monitoring and ensuring the quality of insurance sales activities through banks, Circular No. 67 stipulates that credit institutions operating as insurance agents must establish a specialized department to perform insurance agency activities, and must have a process to monitor and control the quality of insurance agency activities performed by employees in the agency organization.

This process must ensure that employees in the agency organization directly performing agency activities comply with the principles of agency activities, the authorized contents in the agency contract and relevant legal regulations.

Insurance consultants are required to record when providing insurance advice. Image 2

Customers have more information before entering into a contract

+ What does the Circular stipulate about tools to protect customer rights, sir?

- Circular 67 requires documents in insurance contracts: For long-term life insurance products with a cash value, the insurance company must be responsible for providing a paper summary document to the insurance buyer and must have confirmation from the insurance buyer to help the insurance buyer more easily access information, better understand the product, rights and obligations when participating in a life insurance contract before deciding to enter into a contract...

In addition, to ensure customers' right to proactively choose to participate, Circular No. 67 stipulates that insurance companies must set up a calculation tool on the company's website and provide instructions so that customers can proactively build their own insurance plans suitable for themselves before choosing to enter into an insurance contract.

On the business side, Circular No. 67 allows insurance companies to participate in the process of checking, monitoring, and handling violations regarding the quality of agency activities of employees in the agency organization.

Insurance enterprises must conduct periodic supervision and inspection to ensure the quality of insurance product introduction and consultation activities of agency staff, promptly coordinate with agency staff to inspect, review, and handle complaints from insurance buyers related to consultation by agency staff and handle violations (if any).

Circular No. 67 also amends the limits on commissions in the direction of requiring a longer distribution of commission payments, in order to encourage agents to focus on the quality of exploitation and maintenance of insurance contracts. At the same time, it also adds limits on bonus costs and agent support to ensure the business efficiency of insurance enterprises, aiming to develop quality rather than focusing on quantity.

+ Are there any differences in the forms of administrative sanctions for violations in the insurance field, sir?

- Currently, we are in the final stages of completing the Draft Decree on administrative sanctions for violations in the insurance sector. We are drafting this Decree in the direction of specifying violations and strengthening measures to sanction administrative violations, including monetary fines, additional penalties and remedial measures to create a greater deterrent to violations.

We hope that, with such comprehensive regulations along with strengthening management, supervision, inspection and examination of insurance companies and credit institutions, in the coming time, the insurance market will be made transparent and the quality of insurance consulting in general and of credit institutions in particular will be improved, in order to better protect the interests of insurance participants.

+ Thank you very much!

Le Minh (Implementation)

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