Japan's Financial Services Agency (FSA) has warned of growing difficulties for high-risk companies and large factories to secure corporate insurance under the same terms as in the past, as non-life insurers strengthen risk-based underwriting.
The FSA highlighted the trend in its 2026 Insurance Monitoring Report, published on 6 August, noting that insurers are revising their underwriting practices amid natural catastrophe risks, changes in the reinsurance market and persistent challenges in Japan’s fire insurance sector.
Under the changing underwriting environment, major non-life insurers are placing greater emphasis on obtaining sufficient risk information when determining premiums and coverage. Insurers are also reducing underwriting amounts in some cases, while deductibles and lower compensation limits are becoming more common.
The shift represents a significant change for Japan’s corporate insurance market, which has traditionally relied on long-term relationships between insurers and corporate clients, with policies typically renewed annually.
The FSA described the changes in underwriting practices as an “essential and irreversible structural change” necessary to make greater use of international reinsurance capacity.
The regulator’s assessment suggests that the changes extend beyond temporary premium increases. Companies facing higher risks may increasingly need to reassess their insurance programmes, including coverage levels, deductibles and the amount of risk they retain themselves.
The evolving underwriting environment comes against a backdrop of rising natural catastrophe losses and changes in the international reinsurance market, which have increased pressure on insurers to more accurately reflect individual risks in pricing and capacity decisions.
The developments could also prompt Japanese corporates to place greater emphasis on risk mitigation and the quality of risk information provided to insurers when renewing or purchasing coverage.