Fingerprint Instead of Signature... Expansion of Insurance Companies' Fingerprint Authentication Electronic Signatures (Comprehensive)

Spread of Paperless Insurance Culture
Helping Non-Face-to-Face Sales Activities

[Asia Economy Reporter Oh Hyung-gil] Since the COVID-19 pandemic, as insurance sales have increasingly been conducted non-face-to-face, more insurance companies are adopting bio-electronic signatures using fingerprints instead of signatures for identity verification. It is expected that the 'paperless' insurance culture, which replaces paper documents such as policy terms with electronic documents, will spread further.

According to the insurance industry on the 19th, Hyundai Marine & Fire Insurance plans to introduce a fingerprint authentication electronic signature system using smartphones in the fourth quarter of this year. The results of its own pilot implementation showed improved convenience and efficiency during the insurance subscription stage. Hyundai Marine & Fire Insurance obtained a patent related to mobile phone electronic signatures in 2017 and has been using the mobile phone electronic signature method since then.

Meritz Fire & Marine Insurance has also recently started work to introduce bio-electronic signature and authentication solutions. It plans to operate bio-authentication electronic signature services linked with the Korea Financial Telecommunications & Clearings Institute’s financial server system as early as this year.

Samsung Life Insurance was the first in the insurance industry to introduce fingerprint authentication electronic signatures with the Korea Financial Telecommunications & Clearings Institute in November last year. Samsung Fire & Marine Insurance has also been using fingerprint authentication signatures since May. The method involves taking a fingerprint photo on the insured’s smartphone after the electronic signature.

Fingerprint authentication information is encrypted and stored in a distributed manner with the Korea Financial Telecommunications & Clearings Institute, enhancing customer information protection. Also, since the fingerprint is photographed on the customer’s smartphone, fingerprint information such as the captured image is not stored by the insurance company, eliminating the risk of information leakage.

The ability to use fingerprint authentication to simplify non-face-to-face subscription procedures in the insurance industry became possible due to the amendment of the Commercial Act in November 2018. Until then, for contracts including death coverage where the policyholder and the insured were different persons, consent was only allowed through the insured’s handwritten signature. However, with the amendment, if fingerprint information is entered to prevent forgery, electronic signatures are allowed even for death coverage contracts of others.

Using fingerprint authentication is expected not only to increase convenience for insurance consumers but also to reduce hassle in sales activities. Agents no longer need to go through the process of obtaining written consent forms from each policyholder or insured. Especially as written consent forms are replaced by electronic documents, the burden of storage or loss is also reduced. Previously, the process involved signing subscription documents and then scanning and storing the images.

An insurance industry official explained, "Above all, since fingerprint information can be obtained through the customer’s smartphone without any additional device, convenience is greatly improved," adding, "It can be a great help for non-face-to-face sales activities."