Japan’s Financial Services Agency has announced that it will lower compulsory automobile liability insurance premiums by around 16%, beginning April.
According to a report by Jiji Press, the decision was due to the improved financial performance of the insurance segment, attributed to wider adoption of vehicle safety devices, such as automatic braking systems, which resulted in fewer road accidents.
Automobile liability insurance covers damages caused by traffic accidents that result in death or injury.
The Compulsory Automobile Liability Insurance Council, which advises the Financial Services Agency, will discuss the premium reduction, which was estimated at around 16%. Meanwhile, the Japanese government will release its final decision on the matter by end-January, the report said.
This will be the first time premiums have been reduced since April 2017.
For most of Japan, excluding Okinawa Prefecture and remote islands, a two-year contract currently has a premium of ¥25,830 (US$234.50), the report said. If the 16% cut pushes through, it will reduce the premium by around ¥4,000 (US$36).