[Becoming an Insurance Insider] Why Do You Have to Sign by Hand Dozens of Times to Get Insurance?

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[Asia Economy Reporter Oh Hyungil] 'How many times do you have to sign by hand to subscribe to insurance?'

The importance of handwritten signatures on insurance documents cannot be emphasized enough. This is not only because insurance contracts where the policyholder and the insured are different become invalid without the insured's handwritten signature.

According to insurance business supervision regulations, insurance planners must explain face-to-face to the policyholder during insurance sales, and about 10 handwritten signatures are required during the insurance application. There are also additional writing sections where the applicant must personally write not only their name but also key content.

However, with the advancement of information and communication technology (ICT) and the COVID-19 pandemic, a non-face-to-face era has opened, increasing demands to simplify the handwritten signature and additional writing procedures in the application process.

According to the insurance industry on the 27th, insurance companies are promoting plans to expand the use of non-face-to-face channels as face-to-face sales became impossible due to COVID-19 or consumers became reluctant to meet in person.

The Financial Services Commission proposed a non-action opinion last April allowing non-face-to-face recording methods instead of face-to-face explanation obligations and handwritten signatures when the COVID-19 crisis alert is at a serious or caution level. However, it required checking the recorded content and extending the withdrawal period for applications.

However, as the role of non-face-to-face channels expands, there are also claims that sales activity regulations should change to fit the new environment so that consumers can enjoy convenience in using insurance services.

In particular, mobile applications are a method to alert consumers to important insurance details while simplifying the signatures and additional writings required for the application.

According to a report on insurance sales regulations in the untact era released by the Korea Insurance Research Institute, the methods of implementing mobile applications vary slightly by insurance company, but additional writings are mainly done by keyboard input and check methods, and most use a unified signature.

A unified signature means signing once on the mobile screen, and if the contents to be signed are confirmed by checking, that signature is automatically applied to all signature sections.

However, if existing regulations are strictly applied, keyboard input or checking differs from additional writing, and since the laws regulating each signature differ, applying one signature to multiple signature sections may be problematic.

Also, variable insurance, interest-linked savings insurance, insurance contracts concluded with senior citizens, and renewal-type actual medical expense insurance contracts through telemarketing (TM) can only have happy calls via voice calls.

Byun Hyewon, a research fellow at the Korea Insurance Research Institute, said, "Happy calls that consumers directly access and confirm can be done at the time consumers want, and compared to happy calls, there is the advantage of feeling relatively less time pressure," but added, "Insurance companies should consider ways to effectively confirm important matters of insurance contracts and whether sellers comply with responsibilities to prevent incomplete sales."

She added, "The purpose of signatures, additional writings, and the happy call system is to help consumers fully understand the main points of insurance products and make decisions," and "It is important to find ways to effectively realize this purpose, and advanced technology can be utilized for this."