South Korea’s insurers say they have to charge higher premiums on products sold over insurance comparison platforms than on those sold through the insurers’ own cyber marketing channels, such as their websites.
This is because of the commissions to be paid to the platform operators, such as Naver Corp. and Kakao Corp, when sales through the platforms start in January 2024.
Critics argue that the purpose of an innovative financial service could be eroded if the same insurance product is priced higher under this structure, as it may lead to customers using the comparison platform to compare insurance premiums and then visit each insurer’s homepage to get insured, reported Pulse.
According to multiple industry sources, insurance companies will set new rates that reflect platform brokerage fees in the price of products sold via the comparison and recommendation service channel. The rates will then be verified by the Korea Insurance Development Institute in December and reflected in the services of online platforms.
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