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How the London Market can add value to the Japanese Insurance Industry

How the London Market can add value to the Japanese Insurance Industry. Takashi Oka Tokio Marine & Nichido Fire Insurance Co., Ltd. 2 nd November, 2005. Long historical connection with the London Market Tokio Marine Nichido started in 1890 Other Japanese co’ys have 75 year + relationships

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How the London Market can add value to the Japanese Insurance Industry

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  1. How the London Market can add value to the Japanese Insurance Industry Takashi Oka Tokio Marine & Nichido Fire Insurance Co., Ltd. 2nd November, 2005

  2. Long historical connection with the London Market Tokio Marine Nichido started in 1890 Other Japanese co’ys have 75 year + relationships The Japanese Insurance Industry is domestically focused. Less than 5% of income emanates from outside Japan Very large domestic Automobile portfolio 2004 Domestic automobile premium US$ 44.28 billion being 54.1% of total written premium Introduction

  3. Life Non Life USA Japan UK France Germany Relative size of the Japanese Market • Non- Life and Life Premium volumes (Amounts in USD Million) 1,200,000 1,000,000 800,000 600,000 400,000 200,000 0 Source: Sigma 2 / 2005

  4. Fire Voluntary Automobile Personal Accident Miscellaneous Casualty Marine Inland and Transit Compulsory Automobile Japanese Non-Life Premium Income by Class • Direct Premiums by Line (1 April, 2004- 31 March, 2005) 13.69% 16.84% 3.10% 9.03% 40.32% 17.02% Source: The General Insurance Association of Japan

  5. Introduction (cont’d) • London is important window for the Japanese Insurance Market • Immediate targets are Asia & BRIC, but Europe & USA remain major markets • Millea and other large Japanese Insurance Groups developing into general financial services companies • Greater opportunities for the London Financial community as a whole

  6. Provision of reinsurance capacity Long term stability of capacity Proven willing claims paying ability Quick response is a must Company underwriting is key. Equal treatment not necessarily fair Transparent and sophisticated regulatory regime Outwards cessions from Japan

  7. JAPAN M Respect the difference -one Norm?- JAPAN

  8. Technology transfer • Development of new policy forms & coverage • Many examples of policies developed in the London Market now successfully sold in Japan • Technical support on complex niche business • Development of sophisticated analytical techniques such as financial modelling and portfolio management

  9. Additional Services • Legal, Accounting and Actuarial services • Access to a large highly skilled and talented workforce in the underwriting, broking and support industries • Training

  10. Inwards to Japan • Market access to variety of business • Support of a large and flexible distribution system through London brokers • Help grow the overall size of the Japanese Insurance Market • Ease of entering the London Market through a variety of methods • Strong technical/infrastructure support easily available

  11. Working Environment in London • Large Japanese community in London • Ease of obtaining work permits • Language • Many longstanding friendships

  12. Value of London versus other locations • Access to technical expertise in many lines of business • Lower operating overheads than some locations • Wide talent pool to work with and recruit from • Relative ease of obtaining work permits compared to other locations

  13. Value of London versus other locations (cont’d) • Strong infrastructure and technical support • Tested claims paying ability • Strong and transparent regulatory regime • Communications • Ease of language • History

  14. Conclusion • “History is more or less bunk” (quote by Henry Ford 1916) • This is not true for the London Market and the Japanese Insurance Industry • Please continue to enhance the London Market • The Japanese Insurance Industry is willing to help more in the future

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