ISJ TEXTBOOKS
RESEARCH
Summarizing the original Japanese versions, we have translated and issued a number of brief papers of our research on the following theme into English. Those who wish to refer to these summary papers, please contact us via the enquiry form link below.
■The Status of Utilization of Data, Including Personal Identification Numbers, and Efforts to Standardize Operations in the Insurance Industry in Major Countries（2023.9）
The Digital Agency was established in Japan in September 2021 as a platform to promote Digital Transformation across society. Various measures, including those for the private sector, have been proposed to promote the use of the Individual Number (My Number) system and to expand the use of the My Number Card as a foundation for the digitalization of administrative services for citizens. The use of My Number is currently limited to administrative affairs related to social security, taxes, and disaster response, but in June 2023, a revised law was enacted to allow the use of My Number in other administrative affairs as well. In the general insurance industry, there is an ever increasing need to improve efficiency by standardizing operations in non-competitive areas, in parallel with efforts to improve convenience and create new value through digital transformation (DX)
Given such circumstances, we have conducted research on the latest developments in the general insurance industry in major countries regarding the utilization of data, including mainly Personal Identification Numbers, and efforts to standardize business operations. The purpose of our research is to provide references for the Japanese general insurance industry in considering business strategies and business expansion, including the use of data such as Personal Identification Numbers. We focused on the following subjects:
〇Utilization of Personal Identification Numbers in the general insurance industry
〇Usage of government data in the general insurance industry
〇Issues and future policies related to the use of the system of Personal Identification Numbers and others
〇Standardization of operations in the general insurance industry
■The Current Status, Issues with, and Measures of Efforts to Reduce the Damage from Natural Disasters and to Promote Insurance in Major Countries（2023.3）
Due to the effects of climate change associated with global warming, natural disasters have become more frequent and extensive, causing major damages around the world. Under these circumstances, in many developing countries and regions outside Japan, insurance coverage for economic losses in the event of a disaster is low due to underdeveloped public insurance systems or insufficient penetration of non-life insurance products in the private sector. In addition, even in developed countries with well-developed insurance systems, there is concern about the widening gap between economic losses and insured losses due to the increased severity of natural disasters in recent years.
Given such circumstances, the purpose of our research was to summarize the status of the penetration of insurance coverage for natural disasters in major countries (including the actual situation of insurance enrollment), the causes of and issues with the protection gap, and examples of countermeasures such as government-private partnerships and related policies, and to provide this information to Japanese non-life insurance companies as a fundamental resource for them to discuss their policies and make recommendations for countermeasures to resolve the issues. We focused on the following subjects:
〇Status of protection gaps in natural disaster
〇Efforts undertaken by international organizations and each country
〇Causes of and issues with protection gaps
■Responses by the Insurance Industry in Major Countries for the Realization of Carbon Neutrality—Focusing on Insurance Underwriting and Related Services that Support the Shift to Renewable Energy（2022.9）
Against the backdrop of the manifestation of natural disaster risks resulting from climate change, efforts aimed at realizing carbon neutrality have been accelerating in countries and regions around the world since the adoption of the Paris Agreement in 2015. There has also been a call for the general insurance business in Japan to actively promote initiatives such as improving the sustainability of their business activities, promoting carbon neutrality through insurance underwriting and investment, and disclosing environment-related information appropriately.
Given such circumstances, the purpose of our research was to summarize the trends of international initiatives and international organizations, and the status of responses by the insurance industry and insurance companies in major countries and regions, toward carbon neutrality. By doing so, the research also aims at contributing to the general insurance industry and general insurance companies in Japan in considering what initiatives aimed at realizing carbon neutrality should look like, and how they should contribute to new renewable energy projects, etc. We focused on the following subjects:
〇International trends and the current status in Japan
〇Trends in international initiatives
〇Responses by the insurance industry in major countries and regions
■The Current State of Anti-Money Laundering and Countering the Financing of Terrorism by the Insurance Industry in Major Countries（2022.3）
While money laundering and terrorism financing risks in general insurance business are considered generally low, there is an increasing risk of the general insurance industry finding itself getting involved in financial crimes unintentionally, mainly through overseas transactions, with the progress in globalization and digitalization. In such environment, the Financial Action Task Force (FATF), an intergovernmental forum established to promote international cooperation in countermeasures for money laundering, announced the results of the fourth round of FATF mutual evaluations for Japan on August 30, 2021, which rated Japan as a country requiring “Enhanced Follow-up,” which is at the middle of the three-scale assessment. Triggered by the announcement of the evaluation results, the Japanese government established the “Policy Council for Countermeasures for Money Laundering, Financing of Terrorism, and Proliferation Financing,” and also formulated action plans pertaining to countermeasures for money laundering and terrorism financing for the next three years.
Given such circumstances, the purpose of our research was to summarize the status of the establishment of regulations and guidelines pertaining to Anti-Money Laundering and Countering the Financing of Terrorism (AML/CFT) and responses to the regulations by insurance supervisory authorities, insurance associations, major (re-)insurance companies and insurance brokers in overseas countries/regions. The research results are intended to give Japanese general insurance companies suggestions for measures to be taken in relation to AML/CFT. We focused on the following subjects:
〇FATF’s activities and AML/CFT trends in Japan
〇International trends in AML/CFT
〇AML/CFT in major countries
■The Current State of Insurance Company Business Models in Major Countries（2021.9）
Since being forced to face a difficult business environment as a result of economic stagnation due to Covid-19 and increasingly severe and frequent natural disasters, the use of IT systems and innovative business models to improve productivity has become essential for general insurance companies.
Given such circumstances, the purpose of our research was to examine the actions taken by overseas insurance companies concerning their successful business strategies, the features of their sales distribution channels, how roll-sharing works with intermediaries and the commission systems employed, and also to learn about any initiatives to improve profitability, efficiency and operating expense reductions. The research results are intended to give Japanese insurance companies suggestions for innovating their own business models and fundamentally reform their operating expense structures. We focused on the following subjects:
〇Business model trends within the general insurance industry
〇Profitability, distribution channels and insurance intermediaries
〇Measures taken by insurance companies
〇Measures taken by general insurance intermediaries
■Measures Taken by the Insurance Industries of the U.S. and Europe against Novel Coronavirus Disease（2021.3）
The novel coronavirus disease (Covid-19), which has caused both personal and economic losses in many countries, has also affected the general insurance industry in many ways. Its impact has resulted in not only causing a decrease in premium income, but it has also led insurers to discuss how to protect their policyholders, explore new products to cover pandemic risks, and also re-design their business processes.
Given such circumstances, the aim of our research was to examine recent trends among insurance related entities, such as regulatory authorities, insurance associations and other organizations and insurance companies in the U.S. and Europe. The information we gathered was provided to Japanese insurers to assist them in formulating effective strategies for the post-coronavirus world, and to help them consider ways of modifying their business practices in the new environment. We focused on the following areas:
〇Economic impact on the general insurance industry, and the effect on the development of insurance products as well as business operations
〇Measures taken by regulatory authorities and insurance associations
〇Measures taken by insurance companies
■Responses by insurers in major countries to natural catastrophes intensified by climate change（2020.9）
Large-scale natural catastrophes have been occurring frequently in recent years, causing enormous damage worldwide. There is a view that climate change is a contributing factor, and the insurance industry is required to further strengthen its responses.
Given such circumstances, the aim of our research project was to examine recent trends in the insurance schemes in major countries to address natural catastrophes, and to look at the latest examples of how they are currently responding to such catastrophes. The data we gathered was provided to Japanese insurers to assist them in formulating effective strategies to counter future natural catastrophes. We focused on the following subjects:
〇Insurance schemes addressing natural catastrophes in major countries
〇Measures taken by insurance companies
〇Measures taken by other companies and organizations
■The trend of ERM (Enterprise Risk Management) in Europe and the USA, including how ERM affects insurers’ businesses（2020.3）
Over the last decade since we completed our report entitled “ERM and the Trends in Solvency Regulations in Major European Countries and the U.S.”, insurance companies have improved their ERM by adapting to changes in their surrounding business and market environments. As regulators have implemented laws and regulations encouraging insurance companies to strengthen their ERM, including economic value-based solvency and ORSA requirements, ERM is becoming increasingly important for insurance companies.
With this in mind, our goal was to provide useful data for Japanese non-life insurance companies to consider when enhancing their ERM. In addition to examining up-to-date ERM practices among (re)insurers in major European countries and the United States, we looked at the development of major laws and regulations, and the measures being taken by related organizations such as rating agencies. We focused on the following areas:
〇Outline of ERM
〇Laws and regulations, and measures taken by related organizations
〇Measures taken by leading insurance companies
■Cyber Insurance Market Trends in Europe and the USA（2019.9）
With cyber risk exposure rising year by year, the market demand for cyber insurance is growing globally. While growth in this field is projected to continue, insurance companies are faced with many challenges when underwriting cyber insurance, such as understanding the changing impact of cyber risks and ways of managing them. With this in mind, we hope to provide effective data that Japanese non-life insurance companies will find informative when considering their future business strategies, risk management and suitable insurance products/services.
To achieve this, we believe that researching the measures that have been implemented by European and American insurance companies, and studying the trend of cybersecurity regulations in Europe and the USA will be enormously helpful. Focusing on the following subjects, we conducted research in the UK, France, Germany, Switzerland and the USA.
〇Current situation of cyber insurance
〇Trend of cybersecurity laws and regulations
〇Actions taken by insurance companies and others
■Global Trends in InsurTech Activities（2019.3）
InsurTech-related activities are on the rise around the world as the digitalization of the global economy is
growing rapidly. There is a movement to provide new insurance products/services and improve business processes by using various innovative technologies, such as IoT, AI, Big Data, blockchain, and new business models are surging such as Peer-to-Peer (P2P) insurance.
Under such a global trend, we studied examples observed in other countries concerning InsurTech activities and the trends of regulatory bodies. The following areas are the major focus of our research:
〇Company overviews and services provided of InsurTech companies
〇Actions taken by existing insurance companies
〇Trends of insurance regulatory bodies
■Actions Taken by Foreign Insurance Companies and Others on ESG and SDGs（2018.9）
ESG investing, which incorporates ESG (Environment, Society and Governance) factors in investing
decision-making is increasing, mainly among institutional investors in Europe and the USA. In the
international community, actions taken in order to achieve sustainable development, such as Sustainable
Development Goals (SDGs), are in progress.
Under such a global trend, we focused our research on studying how “insurers and reinsurers” incorporate ESG factors into their core business activities to achieve SDGs. The following areas are the major focus of our research:
〇Global trends of international frameworks and measures taken by insurance companies concerning ESG and SDGs
〇Trends of the legal regulations and the actions taken by insurance regulatory authorities and insurance
trade organizations
〇Examples of business activities carried out by insurance companies
■Measurement, analysis and use of customer evaluations by insurance companies and related bodies (2018.3)
Due to the rapid spread of telecommunications, customer evaluations and word-of-mouth communication via internet are becoming more and more important when choosing an insurance company. The development of information communication technology and SNS means it is essential for companies to be well evaluated by each and every customer.
Under these circumstances, insurance companies and related bodies in foreign countries are gathering and analyzing customer evaluations from various viewpoints, and using the results to improve their business operations. By introducing their activities, we provide useful reference materials for insurance companies in Japan as they look to measure and utilize their customer evaluation records. The following areas are the major focus of our research:
〇Methods of gathering customer evaluations
〇Examples of customer evaluation gathering methods, and how they are used by insurance companies and related bodies.
■Personal Data Protection: Regulatory trends in major countries and countermeasures for the Insurance industry（2017.9）
In view of current global trends on strengthening regulations including the EU General Data Protection Regulation (GDPR), which went into effect from May 2018, to protect personal data, it is important for Japanese insurance companies to review such trends and understand their impact on the Japanese insurance industry.
Our research aims to highlight areas that require appropriate attention by the insurance industry while exploring the latest legal and regulatory environments surrounding personal data protection in the United Kingdom (UK), Germany, France, the United States of America (USA), Singapore, South Korea and China. The following areas are the major focus of our research:
〇Regulations on personal data protection
〇Guidelines and standards stipulated by the insurance industry
〇The current status of the insurance industry in terms of compliance with personal data protection
■Prevention and Mitigation of Natural Disasters by Insurance Industries in Other Countries (2017.3)
In order to assist the Japanese insurance industry in its study on future prevention and mitigation of natural disasters, we researched the measures provided by insurance industries in five countries; the USA, the UK, Germany, France and Switzerland, which are known for their advanced insurance markets and the global operations of their insurance companies.
After outlining the natural disaster insurance systems in those countries, we introduced the major loss prevention/mitigation services provided by insurance companies, insurance-related organizations and others in this paper.
■Systems & Status of Corporate Governance of Insurance Companies in Other Countries (2016.9)
In order to have the revised revitalization strategy of the Japanese Government take a concrete form, in June 2015, the “Corporate Governance Code” was newly introduced and applied to publicly listed companies in Japan. In line with the above move, Japan’s Financial Services Agency revised the Comprehensive Guidelines for Supervision of Insurance Companies and formally announced that their management structures would be monitored to see whether or not insurance companies were engaging in businesses in accordance with Japan’s Corporate Governance Code.
In order to study the ideal format of corporate governance, which would be applicable to the Japanese insurance industry, we researched the systems and status of corporate governance of insurance companies in five foreign countries, namely the UK, Germany, France, the USA and Singapore.
■Compensation for Damages in Other Countries (2016.3)
In accordance with the increasing number of inbound foreign tourists coming to Japan, liability claims filed by foreign individuals are expected to increase along with a rise in automobile accidents cases involving them. In order to handle negotiations smoothly and maintain appropriate insurance claim payments, it is important to understand the compensation systems in place in the victims’ countries of residence in terms of levels of compensatory damages as well as customs and culture.
Under these circumstances, we have compiled factual details, which should be kept in mind, such as how compensatory damages are handled in the following eleven countries and regions when dealing with auto claims in Japan involving foreign nationals: China, Taiwan, Hong Kong, South Korea, Thailand, Singapore, Malaysia, the Philippines, the United States, the United Kingdom and Germany.
■Use of the Internet & Mobile Devices in the Insurance Industries of Other Countries (2015.9)
A study was conducted to find out how the Internet and mobile devices are being used in the sales and claims handling of non-life insurance together with the extent of the implementation of other new information technologies in the following eight countries: The United States, the United Kingdom, Germany, Sweden, Netherlands, China, India and South Korea.
In order to understand how technological progress and changes in consumer behavior are likely to affect the non-life insurance industry and to help take necessary actions and make preparations, we summarized our findings in this paper, which is to be used for reference purposes. The situation in the following countries and regions was surveyed: Myanmar, Cambodia, Vietnam, the Philippines, Indonesia, Thailand, Malaysia, Singapore, South Korea, China, India, Brunei, Laos, Hong Kong and Taiwan.
■General Insurance Markets & Systems in Asian Countries（Part 2） (2015.3)
With the purpose of envisaging how Asian countries plan to cope with the new environment in light of the ASEAN Economic Integration of 2015, we conducted a second research project. Due to recent significant changes in insurance related laws and regulation systems, we updated our 2013 research project’s findings and facts. The survey was conducted in the following fifteen countries and regions: Myanmar, Cambodia, Vietnam, the Philippines, Indonesia, Thailand, Malaysia, Singapore, South Korea, China, India, Brunei, Laos, Hong Kong and Taiwan.
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