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Banks forcing borrowers to buy insurance to face sanctions

The Saigon Times

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HCMC – The Ministry of Finance has joined hands with the State Bank of Vietnam to take swift action against violations by banks and insurance companies in forcing their clients to buy life insurance.

Minister of Finance Ho Duc Phoc admitted to flaws in bancassurance at a discussion on the country’s socio-economic situation while addressing the National Assembly yesterday.

At the discussion, Nguyen Thi Thuy, deputy head of the Judicial Committee of the National Assembly, pointed out shortcomings in the insurance market, emphasizing that some customers were forced to buy life insurance when they sought loans, while some depositors were deceived into signing life insurance contracts.

The Ministry of Finance has drawn up regulations on principles for insurance products, insurance contracts and maximum commission rates for insurance agents, and has sought approval from the Government for issuance.

Additionally, Thuy suggested that the Ministry conduct a comprehensive inspection of the life insurance sector, focusing on banks’ tricks to force borrowers to buy life insurance. Meanwhile, the Ministry of Public Security should identify any sign of fraud or deception and conduct investigations.

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