The Financial Services Agency (FSA) has mandated several Japanese insurers, including Sompo Japan Insurance Inc., to report incidents involving the improper disclosure of policyholder information by employees on loan to insurance agencies.
Sompo Japan’s Compliance with FSA Directive
Sompo Japan Insurance Inc. revealed on Tuesday that it has received an order from the FSA to detail cases where loaned employees disclosed policyholder data to the non-life insurer. This directive is grounded in the insurance business law, according to a report by Nippon.
Broader Implications for Japanese Insurers
This directive isn’t isolated to Sompo Japan. Tokio Marine & Nichido Fire Insurance Co. also confirmed receiving a similar order from the FSA. In addition, Mitsui Sumitomo Insurance Co. and Aioi Nissay Dowa Insurance Co. have been issued comparable directives.
Sompo Japan admitted that employees seconded to nine different insurance agencies had leaked client information from other insurers. Specifically, approximately 2,700 sets of policyholder data were transferred from Tokyo-based Total Insurance Service Ltd to Sompo Japan. Furthermore, data on 1,518 fire insurance policyholders with investment condominium loans were leaked from Yokohama-based insurance agency Hoei Co.
Potential Data Breach at Tokio Marine
In a related development, Tokio Marine Holdings has reported a potential leak of personal data affecting around 63,200 policyholders. This issue arose following a ransomware attack on a server managed by an outsourced accounting firm. The breach potentially affects entities under Tokio Marine, including Tokio Marine & Nichido Fire Insurance Co., Tokio Marine & Nichido Life Insurance Co., and E.design Insurance Co. The compromised data includes names, addresses, and insurance policy numbers, although no unauthorized use has been reported so far.
Upcoming Fire Insurance Premium Increases
Industry sources indicate that Tokio Marine & Nichido Fire Insurance Co. is among Japan’s top four non-life insurers planning to increase fire insurance premiums by approximately 10% nationwide starting in October. This hike is in response to rising payouts for natural disasters and increasing home repair costs. The other insurers expected to follow suit are Sompo Japan, Mitsui Sumitomo Insurance Co., and Aioi Nissay Dowa Insurance Co.
Last year, the FSA approved a proposal to raise reference rates for fire insurance by an average of 13%, which insurers use to determine premiums.
