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GIAJ's new chairman highlights initiatives for the non-life sector

The new chairman of the General Insurance Association of Japan (GIAJ), Mr Hiroaki Shirota, has outlined the association's upcoming main initiatives.

Mr Shirota, who was appointed GIAJ chairman on 28 June, released a statement saying that specific initiatives include:

(1) Initiatives to restore trust

The “Project Team for Promotion of Fundamental Business Reform”, established in March, will take the lead to accelerate the industry-wide initiatives to fundamentally review old industry practices and to realise efforts to address various issues that have been studied so far, to restore customer trust.

Referring to these issues, Mr Shirota pointed out that since last year, the general insurance industry had lost the trust of customers due to incidents such as fraudulent insurance claims and price-fixing practices. In addition, in May, information leakage incidents with multi-representative agents were found in some member companies.

He said, “The report of the ”Expert Panel on Structural Issues and Competition in the Non-Life Insurance Sector” published by the Financial Services Agency (JFSA), on 25 June, provides an extremely important direction on how the system should be designed to resolve structural issues within the industry and realise fair competition.”

Based on the various opinions pointed out by the experts, the GIAJ will continue to conduct in-depth studies to develop more effective approaches.

1. Realising a sound competitive environment

To realise a sound competitive environment and to ensure that customers have the opportunity to select appropriate products, various guidelines will be established (e.g., support for customers’ core business, etc.). In addition, to ensure the effectiveness of these initiatives, GIAJ will follow up with member companies on the status of their initiatives and review the contents of the guidelines as needed.

2. Improving business quality of insurance agents and solicitors

To ensure appropriate insurance solicitation management systems at insurance agencies are implemented, the GIAJ will develop industry-wide business quality evaluation standards that incorporate a third-party perspective. At the same time, GIAJ will examine the systems and operations for effectively applying the above evaluation standards. GIAJ needs to pay due consideration to make the standards effective and sustainable, taking into full consideration the fact that there are approximately 150,000 general insurance agencies nationwide, and that they are diverse in size and channels. Improvement and enhancement of education and qualification systems will also be considered to improve the business quality of insurance solicitors.

3. Deepening understanding of insurance and risk management for corporate customers’ businesses

To develop an industry-wide framework for providing corporate customers with information on insurance and risk management, GIAJ will create industry-wide tools to support client companies' understanding and hold seminars to help companies improve their risk management capabilities.

4. Strengthening measures against fraudulent claims

GIAJ will strengthen measures against fraudulent claims in the industry by conducting training for adjusters on the types and modus operandi of fraudulent claims so that customers can file claims with peace of mind. GIAJ will also create an ”explanatory tool for automobile repair shops” to assist them in recording images of damaged vehicles in accordance with MLIT (Ministry of Land, Infrastructure, Transport and Tourism) guidelines and increase transparency in auto repair.

5. Further strengthening of compliance

GIAJ will hold ”Anti-Monopoly Act Compliance Seminars” for member companies periodically. It will ask the General Insurance Institute of Japan (GIIJ) to hold special lectures on the Antimonopoly Act in its main course.

6. Follow-up on respective initiatives and sharing examples of initiatives

In order to continuously improve the business quality of the industry as a whole, GIAJ will follow up on the penetration of initiatives by respective member companies through questionnaires and monitoring of the status of initiatives, and support further initiatives by sharing examples of initiatives.

7. Other initiatives

GIAJ will work to resolve various issues by commissioning the General Insurance Institute of Japan (GIIJ) to conduct surveys and research to reaffirm the regulations on insurance brokers and agents, as well as the actual status of corporate insurance solicitation in foreign countries, and to use this as a reference for future efforts.

(2) Initiatives related to the 10th Medium-Term Master Plan

1. Strengthening natural disaster response capabilities

a. Strengthening preparedness for major earthquakes

To ensure prompt and appropriate insurance claim payments in the event of a super large-scale earthquake, such as a Tokyo Inland Earthquake and/or a Nankai Trough Earthquake, GIAJ will work to convert the damage status report (self-report) system, which has to date been conducted by paper and mail, to an online system. GIAJ will aim to complete its development during this fiscal year. In light of the Noto Peninsula Earthquake, new issues have been identified, such as the difficulty of on-site inspections due to the disruption of roads, etc.

GIAJ will examine the issues in assessing earthquake insurance losses and consider the necessary measures. On the occasion of the 30th anniversary of the Great Hanshin-Awaji Earthquake (Kobe Earthquake), GIAJ will pass on the memories and experiences of the disaster to future generations and implement a plan to convey the importance of preparedness.

b. Trouble prevention measures related to unscrupulous companies that take advantage of natural disasters

Because there remain problems with unscrupulous companies soliciting victims of natural disasters and charging them high fees and/or cancelation fees for home repairs, etc., GIAJ will continue to raise awareness about the prevention of problems in cooperation with relevant organisations such as the police and consumer affairs bureaus, and the Independent Insurance Agents of Japan, etc. GIAJ will continue to support appropriate insurance claim payments through the use of fraudulent claim prevention systems (operated by the GIAJ) and other means.

2. Improving convenience through promotion of digitalisation

a. Digitalisation of CALI (Compulsory Automobile Liability Insurance)

The development of ”One-JIBAI (CALI)”, an industry-wide joint system, is underway, to be launched by the end of this fiscal year (next March). The system will improve convenience for customers by making the transfer and cancelation of insurance policies paperless and the payment of premiums cashless, and also improve the efficiency of the industry as a whole by enabling policy administration. To further promote appropriate claim adjustment operations, GIAJ has begun the development of a system that digitises and shares insurance claim-related documents, and conducts investigation and settlement processing without paper.

b. Digitisation of educational texts for general examination for general insurance solicitors

GIAJ will establish an environment in which educational texts for the General Examination for General Insurance Solicitors can be viewed on PCs, tablets, and smartphones to improve convenience and learning effectiveness for examinees and promote paperless initiatives, too.

3. Improving literacy towards general insurance

a. Enhancing the dissemination and understanding of general insurance

GIAJ will engage in awareness-raising activities on water damage compensation based on an appropriate recognition of their own water damage risks, such as flooding due to river overflows, landslides, and inundation due to inland flooding. To ensure that small and medium-sized enterprises (SMEs) are properly prepared for business risks, GIAJ will conduct a survey on SMEs' risk awareness and countermeasures, and engage in dissemination and enlightenment activities in cooperation with the Independent Insurance Agents of Japan and the local Ministry of Economy, Trade and Industry bureaus throughout Japan.

b. Strengthening cooperation with the life insurance industry

In cooperation with the Life Insurance Association of Japan and the Japan Institute of Life Insurance, with which GIAJ signed a "Comprehensive Collaborative Agreement on Insurance Education" last November, the general insurers’ body will expand seminars for junior high and high school teachers of home economics, social studies, and civics to deepen their understanding of private insurance, and create educational materials for private insurance education.

4. Other initiatives

Furthermore, GIAJ will steadily promote the following initiatives, which are indispensable to fulfil the GIAJ’s objectives:

  • Operation of the General Insurance Counselling and ADR Centre

  • Various requests and recommendations

  • Responses to international standards

  • Support to and cooperation with other economies in Asia

  • Promotion of disaster prevention education

  • Catastrophe loss reserve system

  • Raising awareness of traffic accident prevention

  • Donation of light fire trucks


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