Bank federation chief calls for bancassurance deregulation

[THE INVESTOR] Korea Federation of Banks chairman Ha Yung-ku called on the government to relax regulations on selling insurance product through banks for the development of financial industry and consumer convenience.
“Various problems occur due to the lack of progress in improving bancassurance-related regulations,” Ha said at a seminar held in Seoul to evaluate bancassurance policies on June 23.

Bancassurance is an arrangement under which banks and insurers form a partnership to allow the insurance company to sel products to the bank‘s client base.
 

“Whole life and car insurance products are still banned from going through bancassurance channels,” Ha noted.

The chairman also called for the elimination of the current 25 percent ceiling that bans banks from filling more than one-fourth of their portfolios with products from a single insurer. This, Ha said, hampers free competition and is ultimately keeping bancassurance from fully developing in Korea.

By Park Han-na (hnpark@heraldcorp.com)