TOKYO: Sompo Japan Insurance Inc. inappropriately prearranged with other nonlife insurers premiums for contracts with a total of 385 corporate clients, in possible violation of the antimonopoly law, a report by an external investigation committee has shown.

The malpractice was found to have been conducted at about 80 percent of the company’s sales offices.

The committee also discovered cases in which Sompo Japan management was involved in the misconduct, warning that a similar scandal may occur unless the firm carries out drastic structural reforms.

It concluded that 96 of the company’s 125 sales offices inappropriately prearranged premiums with other insurers, and said that the practice was commonplace mainly among sales personnel.

Staff obtained from other companies the terms and conditions of insurance contracts and shared them internally, the committee said.

Many instances showing lack of awareness for governance and legal compliance were detected, such as involved management members deleting emails that could be evidence of conversations linked to the improper practice.

Japanese insurers were found to have prearranged premiums for joint contracts for corporate clients whose benefit payment risks are shared by multiple insurers. The Financial Services Agency has issued business improvement orders to Sompo Japan and three other major nonlife insurers for inappropriate acts regarding contracts with over 500 companies.

JIJI Press