The Financial Services Commission (FSC) has been working on amendments to the Enforcement Decree of the Insurance Business Act and the Regulation on Supervision of Insurance Business to make the insurance market more accessible to the public. The amendments, which are expected to take effect as soon as they are officially promulgated probably in June 2018, aim to improve access to insurance services and reduce insurance protection gaps in Korea. For example, online shopping malls will be allowed to sell some types of personal lines insurance that provide simple forms of coverage in return for a small amount of premium over a short period of time (less than two years), such as travelers insurance and sport and leisure insurance. The process of subscribing to such an insurance policy will be streamlined with simplified documents. These measures, as part of the government’s effort to support the development of the InsurTech sector, will help promote insurance sales through the online distribution channel, facilitating the growth of online insurers. In the same vein, the FSC is also working on a measure to ease capital requirements for the formation of online insurers.
Meanwhile, the FSC also aims to strengthen the protection of insurance consumers under the new regulations. Currently, an insurer must physically deliver an insurance policy in writing to the policyholder, which causes inconvenience to the policyholder and cost burden to the insurer. The new regulations, however, allow the insurer to provide the document in an electronic format via email or text message if it is agreed by the policyholder. Another measure to protect consumers is to require an insurer to notify its potential clients whether they have presently coverage that is overlapping with the one they intend to buy from the insurer. This requirement applies only to the sale of non-life insurance products that indemnify the insured for the actual losses incurred.