Top Japanese fire insurers plan rate hike

Insurers’ profitability suffers amid record-high pay-outs

Top Japanese fire insurers plan rate hike

Insurance News

By Gabriel Olano

Four of the largest general insurers in Japan are looking to raise their fire insurance premium rates by between 5% and 9%, beginning October.

The premium hike, which will be the first in four years, comes after a rise in insurance claims due to a string of natural disasters, Jiji Press reported. These disasters include Typhoon Jebi and torrential rains leading to flooding in western Japan in 2018. Pay-outs are expected to exceed the ¥1 trillion mark for the first time in history.                                                

The higher premiums are expected to improve the insurers’ balance sheets, the report added.

Tokio Marine & Nichido Fire Insurance Co. will increase its premiums by average of 6% to 7% nationwide. Meanwhile, Sompo Japan Nipponkoa Insurance Inc. will charge 5% to 7% more in premiums. Mitsui Sumitomo Insurance Co. and Aioi Nissay Dowa Insurance Co. both plan to impose a premium hike of 6% to 9%. The exact rates will differ depending on the type of structure and its location.

General insurers in Japan have felt a crunch in recent years, with profitability from the motor insurance segment declining due to falling premium rates.

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