Current state of Japanese life insurance sector (2)
Risk-based approach to life insurance business in Japan
April 11, 2014
Summary
◆Japan’s life insurance sector is adapting to risks exposed by structural changes in the domestic market.
◆Japan’s shrinking population and changing population mix are changing life insurance needs. A rise in new entrants, diversification of sales channels, and global regulatory changes are altering the competitive environment.
◆The emerging risks insurers need to respond to include fewer opportunities to assume insurance underwriting risk, diversification of insurance underwriting risk, changes in the value chain and supply chain, and changes in methods for controlling investment risk.
◆These conditions call for insurers to put increased focus on liability risks, clearly communicate such risks to stakeholders, and seek opportunities that help build corporate value.
◆In short, life insurers need to identify which risks offer the opportunity to build corporate value or are necessary to carry out operations.
◆In Part 2, we look at individual life insurance, examining trends over the past decade in the number and the face value of new and in-force policies and annualized insurance premiums, by insurance product and policyholder age.
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