The Japan Insurance Report considers the prospects for both life and non-life (property & casualty and health) insurers. Both segments differ quite markedly from their counterparts in other countries that are surveyed by BMI. In part because of mega-mergers (particularly in the non-life segment), companies have enormous scale by any standards. Insurers are an integral part of the peculiar financial sector of Japan, in which accumulated savings are enormous and are often channelled to the government and its agencies through Japanese government bonds (JGBs) or other securities.
Perhaps most importantly, the markets are orderly. Notwithstanding that some major lines (such as the auto-related business written by many of the major non-life companies) there is an absence of cutthroat competition. Barriers to entry to foreign groups are high. However, they are not insurmountable.
Particular foreign groups with the absolute size, capital strength, brands, expertise in developing annuity products (especially) and long-established distribution relationships continue to flourish in Japan.
As of July 2012, much of the latest newsflow has been uninspiring. The stagnation of the Japanese economy, the strength of the yen, and peculiar demographics have had adverse effects on insurance companies' finances. For the non-life companies, the losses arising from the floods in Thailand in late 2011 appear to have produced even larger claims than the earthquake and tsunami of March last year (in relation to which, much of the costs were borne by the government, Japan Earthquake Reinsurance and the global reinsurance industry).
The report identifies the major trends and themes in both the life and the non-life segments. It incorporates BMI's latest economic forecasts and projections for relevant aspects of the Japanese economy, such as spending on healthcare and registrations of automobiles. Crucially, the report places the Japanese insurance sector in the context of all the other national markets that are surveyed by BMI. The report highlights areas of growth and opportunity. For instance, many companies – in both major segments – are developing distribution networks to reach new groups of clients or to promote new products. Non-life companies are diversifying into life insurance. Life insurance companies are working to make their products easier to understand. Meanwhile, some of the Japanese insurers are expanding into foreign markets, and often by way of acquisitions.
Over the last quarter, BMI has made the following changes:
- Recent announcements from major insurers and ratings agencies are included. - Projections include the latest wave of data which points to continued stagnation in Japan's economyThe price of this market report covers 4 quarterly reports on this sector. This quarterly report will be downloadable instantly as a PDF document, with the 3 remaining reports delivered at regular intervals throughout the year.
Click for Report details:Japan Insurance Report Q4 2012