Japan Insurance Market Intelligence: 2011 Edition
The Japanese insurance industry is one of largest markets in Asia in terms of premium. Life insurance is the leading sector of the Japanese insurance market, accounting for more than 80% of the total insurance industry. Though the Japanese insurance density and penetration rates are quite comparable, the market is experiencing a slow growth mainly because of economic challenges which the country is facing due to global economic slowdown.
Japan's non-life insurance sector has experienced stagnant growth due to sluggish domestic consumption and lowering exports affected by the global financial crisis. In this scenario, the non-life insurance sector has witnessed major restructuring in the year 2010 with the creation of two new entities - MS&AD (formed through the integration of Mitsui Sumitomo, Aioi, Nissay Dowa and their group companies) and NKSJ (formed through the integration of Sompo Japan, Nipponkoa and their group companies).
With slowed economic growth, huge public debt, political instability, ongoing deregulation and demographic changes, attaining and sustaining high performance in the Japanese insurance marketplace will be a challenging task for insurance companies. However, rising aging population, increasing voluntary automobile insurance premium, increasing new car sales and increasing savings rate are some of the factors that would drive growth of the insurance industry of Japan for the next few years.
Japan's non-life insurance sector has experienced stagnant growth due to sluggish domestic consumption and lowering exports affected by the global financial crisis. In this scenario, the non-life insurance sector has witnessed major restructuring in the year 2010 with the creation of two new entities - MS&AD (formed through the integration of Mitsui Sumitomo, Aioi, Nissay Dowa and their group companies) and NKSJ (formed through the integration of Sompo Japan, Nipponkoa and their group companies).
With slowed economic growth, huge public debt, political instability, ongoing deregulation and demographic changes, attaining and sustaining high performance in the Japanese insurance marketplace will be a challenging task for insurance companies. However, rising aging population, increasing voluntary automobile insurance premium, increasing new car sales and increasing savings rate are some of the factors that would drive growth of the insurance industry of Japan for the next few years.
1. INDUSTRY SNAPSHOT
1.1 Industry Structure
1.1.1 Regulated by FSA (Financial Services Agency)
1.1.2 Healthcare insurance becoming most popular product
1.1.3 Sompo Japan Insurance Inc. and NIPPONKOA Insurance Co., Ltd established a joint holding company
1.1.4 Formation of new insurance group by integration of Aioi Insurance, Nissay Dowa General and Mitsui Sumitomo Insurance
1.2 Market Overview
1.2.1 Market Size & Growth
1.2.1.1 Slight increase in total premium revenues in 2009
1.2.2 Market Segments
1.2.2.1 Decline in life insurance premiums in terms of local currency due to economic downturn
1.2.2.2 Sluggish car sales affected both mandatory third party and voluntary premiums
1.2.2.3 Occurrence of frequent natural disasters eroded non-life insurer’s profits
1.2.3 Insurance Density & Penetration
1.2.3.1 Insurance penetration increased due to rising population
1.2.3.2 Penetration Rate above the Average of Industrialized Markets
1.2.4 Market Share
1.2.4.1 Rise in life insurers’ total assets whereas non-life insurer’s assets declined in 2009
1.2.4.2 Entry of new foreign firms including Sony Life Insurance and Orix Life Insurance
1.2.4.3 Merger of Mitsui Sumitomo Insurance Group Holdings, Aioi Insurance and Nissay Dowa General
1.2.4.4 Formation of NKSJ Holdings by merger of Sompo Japan Insurance and Nipponkoa Insurance
2. INDUSTRY ANALYSIS
2.1 Industry Developments
Revision of the Insurance Law
Privatization of the Postal System and Insurance Sales
New York, Japan Insurance Regulators Sign Cooperation Arrangement
2.2 Market Drivers
Rising Aging Population
New Vehicle Sales/Registration
Economic Growth
Growth in National Savings
3. COUNTRY ANALYSIS: RISK ASSESSMENT
3.1 Political Environment
3.2 Macro-economic Indicators: Current and Projections
4. INDUSTRY OUTLOOK: FORECAST AND PROJECTIONS
4.1 Product innovation and improvement of distribution channels led to rise in premiums
4.2 Medical insurance business holds immense opportunity
1.1 Industry Structure
1.1.1 Regulated by FSA (Financial Services Agency)
1.1.2 Healthcare insurance becoming most popular product
1.1.3 Sompo Japan Insurance Inc. and NIPPONKOA Insurance Co., Ltd established a joint holding company
1.1.4 Formation of new insurance group by integration of Aioi Insurance, Nissay Dowa General and Mitsui Sumitomo Insurance
1.2 Market Overview
1.2.1 Market Size & Growth
1.2.1.1 Slight increase in total premium revenues in 2009
1.2.2 Market Segments
1.2.2.1 Decline in life insurance premiums in terms of local currency due to economic downturn
1.2.2.2 Sluggish car sales affected both mandatory third party and voluntary premiums
1.2.2.3 Occurrence of frequent natural disasters eroded non-life insurer’s profits
1.2.3 Insurance Density & Penetration
1.2.3.1 Insurance penetration increased due to rising population
1.2.3.2 Penetration Rate above the Average of Industrialized Markets
1.2.4 Market Share
1.2.4.1 Rise in life insurers’ total assets whereas non-life insurer’s assets declined in 2009
1.2.4.2 Entry of new foreign firms including Sony Life Insurance and Orix Life Insurance
1.2.4.3 Merger of Mitsui Sumitomo Insurance Group Holdings, Aioi Insurance and Nissay Dowa General
1.2.4.4 Formation of NKSJ Holdings by merger of Sompo Japan Insurance and Nipponkoa Insurance
2. INDUSTRY ANALYSIS
2.1 Industry Developments
Revision of the Insurance Law
Privatization of the Postal System and Insurance Sales
New York, Japan Insurance Regulators Sign Cooperation Arrangement
2.2 Market Drivers
Rising Aging Population
New Vehicle Sales/Registration
Economic Growth
Growth in National Savings
3. COUNTRY ANALYSIS: RISK ASSESSMENT
3.1 Political Environment
3.2 Macro-economic Indicators: Current and Projections
4. INDUSTRY OUTLOOK: FORECAST AND PROJECTIONS
4.1 Product innovation and improvement of distribution channels led to rise in premiums
4.2 Medical insurance business holds immense opportunity
LIST OF CHARTS:
Annual Premium: Japanese Insurance Industry: 2002-2009
Japanese Insurance Premium by Segment (%): 2009
Japanese Life Insurance Premium: 2002-2009
Japanese Life Insurance Premium Breakup (%): 2009
Japanese Non-Life Insurance Premium: 2002-2009
Japanese Insurance Density (US$): 2002-2009
Japanese Insurance Penetration (%): 2002-2009
Japanese Life Insurers’ Market Share (%): 2009
Japanese Non-Life Insurers’ Market Share (%): 2009
Japanese Ageing Population: 2001-2015E
Japanese Total Car Production: 2000-2009
Japanese New Car Sales: 2000-2009
Japanese Voluntary Automobile Insurance Premium: 2002-2008
GDP Growth: 2001-2009
National Savings (US$ Billion): 2002-2009
Forecast: Japanese Insurance Industry: 2009A - 2013F
Forecast: Japanese Life & Non-Life Insurance Industry: 2009A - 2013F
Annual Premium: Japanese Insurance Industry: 2002-2009
Japanese Insurance Premium by Segment (%): 2009
Japanese Life Insurance Premium: 2002-2009
Japanese Life Insurance Premium Breakup (%): 2009
Japanese Non-Life Insurance Premium: 2002-2009
Japanese Insurance Density (US$): 2002-2009
Japanese Insurance Penetration (%): 2002-2009
Japanese Life Insurers’ Market Share (%): 2009
Japanese Non-Life Insurers’ Market Share (%): 2009
Japanese Ageing Population: 2001-2015E
Japanese Total Car Production: 2000-2009
Japanese New Car Sales: 2000-2009
Japanese Voluntary Automobile Insurance Premium: 2002-2008
GDP Growth: 2001-2009
National Savings (US$ Billion): 2002-2009
Forecast: Japanese Insurance Industry: 2009A - 2013F
Forecast: Japanese Life & Non-Life Insurance Industry: 2009A - 2013F
LIST OF TABLES:
Combined Ratio Excluding Compulsory Automobile Liability Insurance
Key Macroeconomic Indicators: 2009 – 2013F
Combined Ratio Excluding Compulsory Automobile Liability Insurance
Key Macroeconomic Indicators: 2009 – 2013F
