Minister of Finance: Fairness and transparency for the insurance market

The Minister of Finance said that the Ministry was strengthened to resolve the complaints of insurance participants. Photo: Quochoi.vn

Strictly handle businesses that do not fulfill their responsibilities

On the morning of March 18, at the question and answer session under the program of the 31st Session of the National Assembly Standing Committee, related to the insurance sector, delegate Nguyen Thi Ha (Bac Ninh delegation) said, recently, the life insurance market, especially foreign life insurance companies selling products through credit institutions and banks, recorded many violations. The delegate requested the Minister to inform about the results of handling violations.

Similarly, delegate Pham Van Thinh (Bac Giang delegation) expressed that through inspection results in July 2023, there was an insurance company that had up to 70% of insurance customers cancel after the first premium payment. Therefore, the delegate requested the Ministry of Finance to provide solutions to ensure that insurance businesses did not make similar violations in the future, especially in the context of the Law on Credit Institutions (amended) prohibiting the sale of insurance products that were not required to be associated with the provision of banking products and services in any form.

Regarding this issue, Minister Ho Duc Phoc stated that currently, Vietnam has 19 life insurance companies, but up to 17 companies were joint ventures and foreign companies, so domestic employees and agents mainly carried out the insurance consulting and selling activities of those companies. Therefore, during the implementation process, the role of inspection and examination lacked direction and management, leading to a situation where staff gave incorrect advice, affecting the interests of insurance participants.

Therefore, leaders of the Ministry of Finance believed that it was necessary to develop a coordinated inspection and examination process to ensure fairness and compliance with regulations in insurance business activities.

The Minister also said that recently, the Ministry of Finance has inspected life insurance businesses following the plan and strictly handled them. The processing results were always publicized in the press and enhanced the resolution of insurance participants' complaints when businesses did not fulfill their responsibilities.

Regarding the inspection plan, the Minister of Finance said that 10 insurance companies had been inspected and the plan was to continue inspecting 7 insurance companies next year. Besides that, the Ministry would conduct unscheduled inspections based on complaints and denunciations from insurance participants... to rectify and resolve benefits for insurance participants; and promptly handle violations to ensure that insurance companies comply with the law, demonstrating fairness and transparency in the insurance market.

Minister Ho Duc Phoc said that regulations on compensation have been clearly stated in the Law on Insurance Business 2023. Photo: Quochoi.vn

There are clear regulations on insurance compensation

Responding further to the violations in consulting and "enticing" customers to buy insurance, the Minister of Finance affirmed that the Ministry has conducted inspections when there were complaints; and strictly punished them. In particular, consulting required full recording to serve the inspection and examination work.

The Minister said that in the past, there were contracts that lasted dozens of pages, causing damage to insurance participants, especially in obtaining information. However, when amending the Law on Insurance Business 2023 and related regulations, the drafting agency devoted a chapter to insurance contracts to ensure that insurance contracts are more concise, clearer, and stricter. At the same time, there was also a regulation that, within 21 days, if it was discovered that the insurance contract made errors, the insured had the right to claim the money back, and the insurance company must return it to the insured.

Regarding compensation for damage or loss or injury to people and property to third parties, Minister Ho Duc Phoc said that regulations on compensation have been clearly stated in the Law on Insurance Business 2023. When the implementation of compensation is delayed or shows signs of being intentionally prolonged, causing disputes, there are currently two channels for resolution. The first is to call the Department of Insurance Management and Supervision (Ministry of Finance) - the agency responsible for solving the problem within the scope appropriate to its functions and tasks. Second, if there are signs of criminal fraud, it will be handled through the criminal investigation agency.

The Minister specifically stated that only cases that cause loss of life need records from the police agency to pay insurance benefits, but for cases that do not cause loss of life, the records are acceptable and compensated via electronic records, photo records...

With the state management function, the Ministry of Finance has directed insurance companies to take this issue seriously; if any insurance company intentionally delays and does not pay insurance, the Department of Insurance Management and Supervision will organize an inspection, examination, and resolve complaints following the regulations.

Regarding the issue of digitalization and technology application in the insurance sector, leaders of the Ministry of Finance said they have focused on directing insurance businesses to build and complete databases, digitization, and cashless payments, set up records, and confirm information electronically to follow future trends.