ACLI EXPRESSES “CONCERN” AT JAPAN POST INSURANCE PLANS

The American Council of Life Insurers (ACLI) has raised a number of concerns about Japan Post’s business plan for the privatisation of its Kampo Seimi Hoken life assurance arm. ACLI chief executive Frank Keating said that he appreciated Japan Posts’ transparency in releasing the plan, and said that the ACLI fully appreciated that Japan Post wanted to make the new Postal Insurance Corporation (PIC) attractive to private investors. However, he noted that “the framework of the Implementation Plan envisions that the future PIC will make its money by offering new and expanded product offerings after the start of the transition period in October 2007, but it does not clarify how the PIC will become fully compliant with all of the same legal and regulatory requirements that already apply to private sector insurance suppliers”. Mr Keating said that fair competition could only be maintained unless the PIC was required to “play by the same rules” as private sector assurers, “and the longstanding advantages it has enjoyed as a protected government entity are completely eliminated”. He said that this would not harm consumer interests. “The private insurance sector [in Japan] can already supply all the insurance products that the Japanese public desires”, he claimed, adding that “there is no need for the PIC to develop its own new or expanded products in the near term”.