Life insurers fined for colluding to fix interest rates

SEOUL, Oct. 14 (Yonhap) -- South Korea's antitrust watchdog said Friday that it has fined 12 life insurers a combined 365.3 billion won (US$316 million) for colluding to rig interest rates for years.
Subject to the penalties include Samsung Life Insurance, Kyobo Life Insurance, Korea Life Insurance, Mirae Asset Life Insurance and other major companies, according to the Fair Trade Commission (FTC).
The FTC accused them of conspiring to fix interest rates applied to deposits set aside to pay for clients. The illegal activities took place between 2001 and 2006 through "diverse negotiation channels," it added.
Interest rates are a key factor that determine insurance premiums and the amount of money clients can receive in the future. The FTC said that those insurers colluded in a way that allowed them to better retain customers and maintain overall profitability.
Samsung Life was ordered to pay the largest amount in penalties at 157.8 billion won, followed by Kyobo Life and Korea Life, which have to pay 134.2 billion won and 48.6 billion won, respectively.
Four others, including Dongbu Life Insurance and Prudential Life Insurance, were found to have engaged in such practices but avoided being fined. Instead, they were ordered to take corrective action immediately, the watchdog said.