Insurance Company Illegally Uses Personal Information of Daepo Vehicle Owners... Liability for Compensation

Consent for Collection and Use of Vehicle Owner's Personal Information Required When Contracting Liability Insurance

Obtaining Personal Information through 'Free Adult Content Viewing' Results in 12.1 Billion Won in Charges

[Asia Economy Reporter Jo In-kyung] An interpretation has emerged that the 'vehicle waiver letter' from the registered owner (nominee) cannot be considered as consent for the use of personal information when entering into an automobile insurance contract for so-called 'ghost cars,' where the registered owner and the actual driver are different.

On the 17th, the Personal Information Dispute Mediation Committee judged that an insurance company’s conclusion of a compulsory automobile liability insurance contract naming both the operator of a ghost vehicle and the vehicle owner as insured parties, without explicit consent from the vehicle owner for the collection and use of personal information, constitutes illegal processing of personal information. Accordingly, the insurance company was ordered to pay 400,000 KRW in damages to the vehicle owner for mental distress.

In this case, the applicant, vehicle owner Mr. B, borrowed money from a lending company using his car as collateral and signed a vehicle transfer (collateral) and vehicle waiver letter.

When the applicant failed to fulfill his debt obligations, the lending company sold the vehicle to Mr. C after eight months without registering the ownership transfer. Subsequently, Mr. C and Insurance Company A continuously maintained a compulsory automobile liability insurance contract with Mr. B as the insured for eight years, without informing Mr. B of the insurance contract.

Regarding this, Insurance Company A acknowledged responsibility for negligence in the verification process during the insurance contract and disciplined the insurance agent involved, but explained that since compulsory automobile liability insurance is mandatory, they inevitably relied on Mr. B’s waiver letter.

However, the Dispute Mediation Committee determined that the waiver letter submitted by Mr. B to the lending company could not be interpreted as consent to use his personal information for Mr. C’s insurance contract. Considering that Insurance Company A did not require significant time or effort to confirm Mr. B’s consent as the insured and that the Insurance Business Act requires the insured’s handwritten signature at the time of contract, the committee recognized the insurance company’s illegal act and held it liable for damages for the mental distress caused to Mr. B.

Kim Jin-hae, Investigation and Mediation Officer of the Personal Information Protection Commission, stated, "Insurance companies failing to obtain the essential consent of the owner as the insured when contracting compulsory automobile liability insurance for ghost vehicles ultimately contributes to the proliferation of ghost vehicles," adding, "Insurance contracts concluded through illegal collection and use of personal information raise concerns about the validity of future insurance contracts and insurance claim payments."

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