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The incipient recovery of the global economy has led to various measures being spelled out under the Japanese government's so-called “three-arrow” economic strategy, consisting of monetary policy, fiscal policy, and growth strategies. As a result, Japan’s economy is now in a situation where there are positive signs of an economic upturn such as a correction to the strong yen and rising stock prices.
Also in the accounts settlement for fiscal 2012 of the general insurance industry, a number of companies returned to profit or showed earnings growth thanks to a reduction in claims related to natural disasters both at home and abroad, and an improvement in investment income. However, while some signs of improvement in its profitability were seen, the loss ratio of automobile insurance, which is a mainstay product, remained on the high side.
Since general insurance companies’ business performance is closely linked to economic trends, brisk corporate activities and an increase in consumer spending are positive factors that bring about growth in premium income. Looking from a mid- to long-term standpoint, however, we see that the situation surrounding the domestic general insurance market may remain tough due to the rapidly ageing population and the falling birthrate, which will lead to a depopulating society.
In order for the general insurance business to attain sustainable development and grow in a sound manner amid such an environment, GIAJ realises it is necessary to correctly perceive changes in society and the needs of the customers and carry out measures for the future in a steady fashion.
With the Great East Japan Earthquake as the turning point, there has been a rise in the public's awareness of and attention to accidents, disasters, and crimes. Damage caused by accidents, disasters such as earthquakes, and crimes, can be averted or mitigated to a certain extent by daily awareness of individuals and companies and the implementation of precautionary measures. As with providing better general insurance products and services and promoting their penetration, it is our industry’s important mission to plow ahead with measures for disaster prevention, crime prevention, and traffic safety, in order to help build a safer society.
The GIAJ’s Sixth Mid-Term Business Plan, which runs from fiscal 2012 through fiscal 2014, fosters a strong awareness of these missions and sets “reduction in social losses” as its big challenge.
The risks faced by individuals and companies have become sophisticated and complicated because of changes in society and the environment. GIAJ believes that general insurance companies will be able to help build a worry-free and safe society by precisely grasping such risks, carrying out measures to help reduce risks, and providing better insurance products and services, and thus thinks it will be able to contribute to the development of Japan’s economy as well.