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Insurance Market in Japan
Japanese Insurance Market Overview
Japanese insurance markets are in transition to competitive markets, albeit gradually. Its market size is second only to United States, both non-life (including health) and life. After 2001, major M&As took place for scale amid liberalization. As for distribution channels, agent remains the dominant channel.
Market size: Second only to US
Premiums by Country
Premiums by Sector
Progress of Liberalization
1996
  • Insurance Business Law amended.
    • Mutual entry between life insurance sector via subsidiaries.
    • Brokerage system introduced.
1998
  • The obligation to use the premium rates calculated by rating organizations abolished.

  • Exemption from Anti-trust Law abolished.
    • Development of innovative products enhanced.
2001
  • General Agency System liberalized.
    • Diversification of the level of agency commission allowed.
  • Bank allowed to sell insurance products.
    • Initially limited range of products only.
Players and Channels
Non-life
  • Several new entry including start-up direct response was tried and a few survived. Major insurers merged for scale.

  • Agency is the dominant distribution channel with 93% share by premium. Direct (including "direct salesperson") follows with 7%.

  • Direct response auto premium is growing with moderate speed.

Life
  • Foreign entrants acquired financially troubled insurers, gaining 10+ % market share.

  • Exclusive agent channel (so called "sales lady") occupies 71.7% of the market by number. Banks have 1.7% share in 2003, forecasted to grow in the future.

Related Link

Research Institute for Interdisciplinary Studies (RIIDS)
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