JAPAN Law and Practice Contributed by: Hironori Nishikino and Koji Kanazawa, Chuo Sogo LPC
ance supervision for fiscal year 2025 can be summa- rised as follows. • In view of the drastic changes companies are facing in the business environment, the FSA will encourage them to focus on risk management through the use of non-life insurance. At present,, for companies operating both domestically and abroad, the rising frequency and severity of natural disasters, emerging geopolitical risks, and other factors have increased the risk of business inter- ruptions as well as the potential for greater losses due to litigation and inflation-driven surges in damage costs. From the perspective of enabling companies to manage such risks appropriately and promote growth-oriented investments at the same time, it is important to develop a market for trading non-life insurance products that incorporate the individual risks for each company and project. To this end, in collaboration with relevant ministries and agencies, the FSA will seek to encourage dia- logue between businesses and non-life insurance companies, enabling them to share their specific needs and risk management insights, thereby fos- tering a common understanding among the parties concerned. In addition, in light of growing sever- ity of natural disasters, the FSA will take a leading role in international discussions, such as the G20 Meetings, on the issue of insurance protection gaps where existing insurance does not provide sufficient coverage for the risks.
• Efforts will also be made to prevent the recurrence of fraudulent insurance claims and premium adjust- ment cases that could undermine trust in the non- life insurance industry, thereby ensuring customer- oriented business operations and promoting a healthy competitive environment. • To ensure that insurance companies maintain appropriate information management systems and take precautions against the information leakages occurring in the industry, the FSA will conduct relevant supervision and inspections. • In preparation for the enforcement of the revised Insurance Business Act (enacted in May 2025), the FSA will develop ordinances and revise supervisory guidelines to ensure appropriate comparative rater- based insurance sales by multi-agency brokers (ie, non-life insurance agents and life insurance agents) handling products from multiple insurance companies, strengthen the obligation of large-scale multi-agency brokers to establish robust systems, and promote the use of insurance intermediaries.
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