On the 4th, the Financial Services Agency (FSA) issued an order to the four major non-life insurance companies to improve their operations based on the Insurance Business Act. In addition, this time, advance price adjustments were confirmed in contracts with 26 companies and municipalities.
Four companies have received business improvement orders: Tokio Marine & Nichido Fire Insurance, Sompo Japan Insurance, Mitsui Sumitomo Insurance and Aioi Nissay Dowa Insurance.
The four companies were suspected of pre-adjusting insurance premiums for companies through "co-insurance," in which risks are shared and underwritten.
On the 4th, the Financial Services Agency issued a business improvement order and released a summary of reports from four companies, and said that prior price adjustments have been confirmed in contracts with 4 companies and municipalities at this time.
In some cases, employees were handed over in writing or verbally from their predecessors, or their superiors gave instructions, and in some cases, they were approached by other companies in the same industry to adjust prices.
Despite the high risk of violating the Antimonopoly Act, the FSA has pointed out that there was a lack of risk recognition, such as the failure of management to sufficiently consider how to respond and the failure to adequately educate and supervise sales representatives.
This is the first time in 26 years that four major non-life insurance companies have been ordered to improve their operations at the same time, since 4, when they were disposed of for non-payment of insurance claims.
The FSA will continue to request reports on the implementation status of improvement plans by each company in order to correct the practices that have continued in the non-life insurance industry and strengthen the business management system to prevent recurrence.