Need cash? Short-term, low-value insurance plans gain traction in the market


After a 2006 review of the Insurance Business Act, the number of insurers offering “small, short-term insurance” plans with low premiums and low payments is expected to reach 100 companies by this summer, reporting to the both the popularity of the unique catering system and the diversity of lifestyles as well as the system which is gradually carving out a niche in the market.

In recent years, large life and damage insurance companies have entered the field of small and short plans, thus making the existence of the system known. According to the Small Amount & Short Term Insurance Association of Japan (SSI), the number of registered companies offering small and short plans has increased from 64 companies in 2008 to 97 at the end of 2017. There are already several companies that have entered the preparation phase, which means that the number of companies should reach 100 by the summer.

The most popular by type of insurance is household goods insurance, offered by 46 companies and driven by the growing number of real estate companies. Life and medical insurance came second with 32 companies offering policies and pet insurance third with nine companies. The plans are mainly distributed through internet sales or representative agencies, with insurance premium income for fiscal 2016 of 81.5 billion yen, an increase of 12% over the previous year. previous year for growth of 60% over the past five years.

One element behind the popularity of insurance plans is their uniqueness which is not found among the products offered by large companies. Japan Small Amount & Short Term Insurance Co. offers an insurance plan against false accusations of indecent assault. As part of the insurance, if the person under contract is suspected of assault on a train or other places, an emergency message is sent to the nearest lawyer via a smartphone or other device and the costs of this lawyer within 48 hours of the incident will be fully covered.

Meanwhile, AWP Ticket Guard Small Amount & Short Term Insurance Co. covers the cost of event tickets if the customer is unable to attend due to circumstances such as sudden illness or delays in the event. transport. There is also motorcycle insurance specifically for Harley-Davidson motorcycles.

In addition to the low income in insurance premiums per client, the limited number of people interested in these specialized policies has kept the plans out of the reach of the insurance giants. However, as some of the insurance policies have become very successful in recent years, large companies can no longer afford to ignore the trend.

Aiaru Shogaku Tanki Hoken’s “Lone Death Insurance” (Small Amount and Short Term Insurance) Corp. , prompting insurance heavyweights such as Tokio Marine & Nichido Fire Insurance Co. to also offer the same product. Funeral insurance, with a payment of several hundred thousand yen, also extends across the market to large companies.

There are now examples of large companies developing “on-demand insurance” that provides the necessary funds precisely when the registrant needs it and other such personalized products which were heretofore limited to small insurers only. At the end of 2017, it was revealed that Dai-Ichi Life Holdings Inc. was considering buying Aiaru Corp. It is possible that large life and P&C insurance companies will enter the small-term, short-term insurance market and take market share from small businesses. insurers.

Small Amount & Short Term Insurance Association of Japan Board Chairman Shoji Sugimoto said, “With flexible ideas and mobility that large companies lack, we would like to understand and meet the needs of the modes of life changing. ”

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