"Kakao and Naver Offering Insurance? Why Agents Are Taking to the Streets"

About 300 insurance planners affiliated with the Korea Insurance Agency Association and members of the insurance planners' union held a rally on the 22nd near the Presidential Office in Yongsan, Seoul, to resolve to block the entry of online platform insurance agencies. (Photo by Korea Insurance Agency Association)

[Asia Economy Reporter Changhwan Lee] As the government shows signs of expanding the path for online platforms such as Kakao, Naver, and Toss to enter the insurance business, hundreds of insurance agents affiliated with insurance agencies (GA) took to the streets to voice their opposition.

They criticized that online platforms are not providing differentiated insurance services but are instead taking away the business of existing operators, ultimately leading to higher product prices and causing harm to consumers.

According to the insurance industry on the 23rd, about 300 insurance agents and union members affiliated with the Korea Insurance Agency Association held a rally near the Presidential Office in Yongsan, Seoul, the previous afternoon, titled "Resolution Rally to Block Online Platform Entry into Insurance Agencies."

The GA-affiliated agents took to the streets as the Financial Services Commission was reportedly set to discuss allowing online platforms to enter the insurance agency business at the 2nd Financial Regulatory Innovation Meeting held that afternoon.

The Financial Services Commission is discussing a plan to allow online platform companies such as Naver, Kakao, and Toss to handle all insurance products as part of regulatory innovation. This would enable them to operate similarly to GAs, which handle all insurance products including life and non-life insurance, prompting opposition from GA-affiliated agents.

One agent attending the rally said, "For Naver and Kakao to engage in the GA business is tantamount to large corporations infringing on the small merchants' local markets," adding, "If online platforms fully enter the insurance business, already struggling small insurance operators will be pushed into survival competition."

There are also criticisms that the Financial Services Commission is hastily deregulating without sufficient discussions with stakeholders. The Financial Services Commission began discussions on allowing online platforms to operate GA businesses in August but only held one round of opinion gathering from the GA industry during the process.

Jang Nam-hoon, head of the Korea Insurance Agency Association, said, "The Financial Services Commission has only received one opinion letter from the GA industry so far and has not discussed feedback or participation in further discussions."

Jang emphasized, "Online platforms will easily gain a dominant position backed by massive capital and databases (DB) of tens of millions of users," adding, "This will cause rapid market encroachment and unfair competition, leading to decreased income and job insecurity for insurance agencies and agents."

There are also concerns about the lack of in-depth consideration as to whether the entry of online platforms into the insurance industry will truly benefit consumers.

An insurance industry official said, "As seen with Baedal Minjok or Kakao Taxi, platform operators gather many users under the name of customer convenience, then increase commissions to seek profits, ultimately causing harm to self-employed people or consumers," adding, "Online insurance platforms could follow a similar path."

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