Dai-ichi Life under fire over disputes

Dai-ichi Life under fire over disputes, illustration photo: webbaohiem.net

Pham Thi Tham in the southern province of Kien Giang last month told the media that Dai-ichi Life refused to pay full insurance for her husband, who passed way last August. According to Tham, her husband’s death by electrocution was an accident and his family deserved the full payout of VND1 billion (nearly $43,500).

“A lot of witnesses were there when my husband died and they can easily confirm my statement that it was an accident,” said Tham. “I can’t believe Dai-ichi Life required me to submit documents that were similar to a homicide case.” Tham referred to files such as autopsy results and crime scene reports, which cannot be obtained by any means from the local authorities because her husband was not killed.

Without the additional documents, Dai-ichi Life only agreed to pay out half of the expected amount. In response to Tham’s accusations, the company said that there is not enough evidence to prove that her husband’s death was purely an accident. This also means Dai-ichi Life does not recognise the death certificates issued by the local authorities which stated that electrocution was the sole reason for the death. Both Tham and insurance experts believed that this violates the industry’s code of conduct.

Just a few months previously, Dai-ichi was embroiled in another conflict over the case of Le Tan Tin, a farmer in the central province of Quang Ngai who died from a disease. The insurer refused to pay out money because they believed Tin passed away during a fishing trip, which was not covered in the contract. Tin’s family and the local authorities maintained that Tin mostly stayed home for farming and husbandry, while the trip in question, which took place months before the death, was only to help out a relative.

In other words, Tin’s main occupation was a farmer and not a fisherman as Dai-ichi Life claimed, said the family. Subsequently, Tin’s family said they did not receive the agreed amount of VND350 million ($15,200) from the insurer, receiving instead VND30 million ($1,300) as a goodwill gesture.

Truong Minh Cat Nguyen, CEO of insurance consulting firm Tila commented, “Customers usually lack the legal knowledge necessary to understand the highly complex terms in insurance contracts.” He said that it is also “highly troublesome for them to get all the necessary documents for the insurance claim, because they can be met with red tape.”

According to Nguyen, insurance agents at Dai-ichi Life or others may focus more on getting the contracts signed than explaining to customers the convoluted terms and conditions of the contracts. Moreover, agents are not the same people as those who approve or decline the claim, making it even harder for customers.

Dai-ichi Life’s difficulties do not end there. In another incident last month, some of its agents took part in protests over cuts in bonuses, a move that the agents believed was unfair. Specifically, all employees of Dai-ichi Life’s distribution channels suffered cuts of up to 80 per cent in bonuses, and high-performing staff members saw their bonus rates falling from 15 and 11 per cent to only 2.5 and 2 per cent, respectively. The adjustment was applied for the fourth quarter of last year, later being readjusted, but yet to be paid to the agents in full.

In reponse to VIR queries on the issues last week, a representative from Dai-ichi Life said that its leaders were still considering before offering an official comment.

Previously, Dai-ichi Life was accused of aggressive telemarketing, with customers complaining of violation of privacy. Some reported they were called up to three times a day by Dai-ichi telemarketers, which disrupted their daily lives. The problem has seemingly diminished due to the backlash at the time but today a vast number of customers still complain about cold calls from the insurer. “As the market grows, insurance firms should improve their marketing tactics and business strategies in general, cultivating trust and faith in customers,” said Nguyen.