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Japanese insurers fail to pay out

Following the insistence by the domestic Financial Services Agency to carry out a round of internal checks, six Japanese non-life insurers have revealed that they failed to pay out on over 262,000 legitimate claims in the last 12 months.

Unhappy with the performance of the non-life insurance industry, the Japanese Financial Services Agency (FSA) instructed firms to review their accounts. The move is the second time in recent history that such a demand has been made.

The results will have disappointed the Japanese FSA, as the number of failures to pay legitimate claims has almost doubled from the 140,000 such instances recorded in 2005. The total value of the unpaid claims amounts to Y16.23 billion.

Sompo Japan Insurance and Mitsui Sumitomo Insurance have already been forced to suspend business as the result of earlier investigations, while, according to the latest revelations, Aioi Insurance has emerged as the worst culprit as it failed to pay benefits on 68,395 contracts, the Mainichi Daily News has reported.