The inspection results of the Ministry of Finance showed that Prudential, MB Ageas Life, Sun Life and BIDV Metlife violated regulations when cross-selling insurance through banks.
According to the inspection conclusion announced by the Ministry of Finance today, these businesses all committed violations when cross-selling insurance through the banking channel (bancassurance), especially in the consulting stage of transaction officers and brokers.
Some typical violations include employees not consulting directly with customers or not providing full instructions on procedures and required documents as prescribed. Insurance companies also do not ensure the quality of advice, leading to customers not understanding the product.
The Ministry of Finance also pointed out the situation where insurance company employees let agents or bank employees use agent codes to guide customers to enter information. Enterprises do not comply with the insurance premium schedule approved by the Ministry of Finance.
"These violations will be considered for administrative sanctions, ensuring strictness and deterrence to the market," said the Ministry of Finance. In addition, the agency said it would make the decision to impose sanctions public to ensure objectivity and transparency.
Insurance contract of a customer who filed a complaint when purchasing through a bank channel. Photo: Quynh Trang
The insurance market, especially the bank channel, has grown rapidly in recent years, but there have been many negative aspects such as banks forcing borrowers to buy insurance or confusing the concept of insurance with savings.
Investment-linked insurance products are advertised by insurers as having the meaning of risk protection and additional investment benefits. But in reality, customers' insurance premiums will be deducted a lot of costs, before being allocated to the investment-linked fund.
Based on the inspection results, the Ministry of Finance requested the four enterprises to strengthen management and comprehensively rectify the bancassurance channel, in which, importantly, it is necessary to rectify the training, management and supervision of the quality of insurance agents. This is to promptly detect violations by agents and individuals belonging to insurance agencies.
Insurance companies are also required to review insurance agency operating expenses, ensuring that these expenses serve insurance business activities and have full documents and evidence.
In the joint resolution of the 5th session passed by the National Assembly on June 24, the Government was requested to conduct a comprehensive inspection of the life insurance market, especially investment-linked products; and handle shortcomings in brokerage and cross-selling of life insurance.
The Ministry of Finance said that in addition to the four companies above, this year the Ministry will continue to inspect the sale of insurance through banking channels at 10 enterprises. If violations are detected, the agency will strictly handle them according to regulations.
Quynh Trang
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