Major nonlife insurance firms enjoyed sizable increases in sales of fire insurance policies and resultant rises in premium revenues in the April-July period.
The upsurge was attributed partly to a rush by mortgage takers to purchase homes and condominiums prior to the June 30 deadline for a tax deduction of up to 5.87 million yen, industry officials said.
Starting July 1, the government cut tax deductions for new mortgage takers by 15 percent on average, though it extended the eligibility period for smaller deductions of up to 5 million yen until Dec. 31, 2003.
The officials said the increase stemmed from the April 1 removal of a government ban on policy sales at branches of banks that have tied up with insurers.
The biggest beneficiary of the home-buying spree was Tokio Marine & Fire Insurance Co., which reported a 9 percent year-on-year rise in fire insurance premium revenues in the second quarter.
Sumitomo Marine & Fire Insurance Co. reported an increase of about 5 percent, as did Nissay Dowa General Insurance Co.
Among the 13 major nonlife insurers, 10 reported raking in larger fire insurance premium revenues than they did in the corresponding period a year before.
The domestic fire insurance market has been following a downward path over the past four business years. But the revenue surges in the first three months of 2001 have bolstered the spirits of the nonlife insurers, the officials said.
"Our revenue associated with the fire insurance policies purchased by mortgage takers in May was 1.5 times that of the corresponding revenue a year before," an official at Yasuda Fire & Marine Insurance Co. said.
An official at another major nonlife insurer said, "The removal of the government ban on insurance policy sales at bank branches from April appeared to have had a major favorable effect on our business."