"Beware of Complaint Agency Firms Misleading Consumers with 'Full Refund of Paid Insurance Premiums'"

Encouraging Complaints While Demanding Retainers and Fees

Life Insurance Association Logo

Logo of the General Insurance Association

[Asia Economy Reporter Oh Hyung-gil] As illegal complaint agency companies have emerged, enticing consumers with phrases such as "Insurance canceled over 20 years ago can also have damages recovered" and "Average damage recovery amount over 3 million KRW," and demanding fees while encouraging insurance complaint filings, consumer caution is required.

On the 23rd, the Life and Non-life Insurance Associations announced, "We will continuously monitor illegal complaint agencies and take active measures such as additional criminal charges and operating a reporting center until illegal business practices are eradicated."

These complaint agencies recruit insurance complainants through broadcasts or social media (SNS) promotions and engage in business by embezzling upfront fees or success fees while acting as agents for filing complaints to insurance companies or the Financial Supervisory Service.

They reportedly use complaint forms such as those for incomplete sales to assist complainants in filing complaints and pressure insurance companies by threatening to file complaints with the Financial Supervisory Service if the insurance companies refuse to accept the complaints.

They also exploit the characteristics of insurance products where the surrender value is less than the premiums paid, promoting the idea that the full amount of premiums can be refunded.

In response, the Life and Non-life Insurance Associations have criminally charged some complaint agencies, and recently courts have imposed fines on them for violating the Attorney-at-law Act.

An association official stated, "It is advisable for consumers to file complaints through legitimate procedures to resolve dissatisfaction or disputes related to insurance," adding, "Insurance consultations are also available at the Life and Non-life Insurance Associations' consultation centers."

This content was produced with the assistance of AI translation services.