Jeong Eun-bo, Financial Supervisory Service Chief, "Will Create a Level Playing Field for Big Tech and Insurance Companies"

Jeong Eun-bo, Governor of the Financial Supervisory Service

[Asia Economy Reporter Changhwan Lee] Jung Eun-bo, Governor of the Financial Supervisory Service, stated that he plans to focus on creating a broad and level playing field where big tech companies and insurance companies can compete fairly in the domestic insurance market.

On the morning of the 24th, at a CEO meeting of the insurance industry hosted by the Insurance Training Institute held at the Lotte Hotel in Sogong-dong, Seoul, Governor Jung said, "Under the grand principle of same functions, same regulations, we will establish a supervisory system that allows insurance companies to compete fairly with large IT companies."

This statement is interpreted as a response to recent concerns raised by existing insurance companies about potential reverse discrimination as big tech companies such as Naver, Kakao, and Toss are pushing to enter the insurance market.

He emphasized, "We will continue discussions with related authorities such as the Financial Services Commission to establish a general regulatory framework related to financial intermediation," and added, "We will actively support sustainable innovation in the insurance industry and the establishment of a sound market order."

Governor Jung explained, "We will establish an institutional foundation so that insurance companies can achieve innovative growth and protect insurance consumers simultaneously by utilizing digital technology." He cited the improvement of consumer protection procedures related to non-face-to-face sales by insurance companies using digital technology as an example.

He added, "We will encourage the supply and success of creative and innovative business ideas in the industry to the market by utilizing regulatory sandboxes in the insurance sector."

He also urged the management of potential risks, noting that global financial uncertainties surrounding the domestic financial market are increasing and that insurance companies will adopt the International Financial Reporting Standards (IFRS17) next year.

Governor Jung stated, "Recently, as the U.S. accelerates its tightening pace, combined with geopolitical risks related to Russia, volatility in capital and foreign exchange markets is increasing," and added, "In particular, due to the sharp rise in market interest rates, the increase in bond valuation losses held by insurance companies is affecting financial soundness, so it is necessary to actively respond to short-term financial shocks."

He urged, "With the introduction of IFRS17 next year, CEOs need to pay close attention to potential risk management, including proactive capital expansion, sufficient provisioning for bad debts, and strengthened monitoring of alternative investments."

Regarding the reorganization of insurance company inspections and supervisory plans, he stated that based on laws and principles, the system will shift to periodic regular inspections to increase the predictability of inspections. He also explained plans to provide insurance companies with preemptive corrective functions for vulnerable areas through the designation of communication cooperation officers and the requirement of internal audits.

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