Financial Services Agency (FSA), a Japanese government organization responsible for the regulation of the financial services industry, is planning to issue a ban on insurance agencies from allowing subcontractors to sell insurance products.
The move comes as a result of FSA’s opinion that subcontractors often fail to sufficiently explain products to customers and instead try to sell them to earn more commissions.
According to FSA, several insurance firms are not offering proper training to subcontractors, which has led to seek complete ban on sales by subcontractors.
Meanwhile, FSA plans to order all life and nonlife insurance companies to report on their insurance agencies, as well as measures to enhance sales manners, reports prolink-consulting.com.
FSA oversees banking, securities and exchange, and insurance in order to ensure the stability of the financial system of Japan.