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In May, Yamagata University disclosed that it had bungled its entrance exam grading, irretrievably altering the course of applicants’ lives.

After similar mishaps at two other universities, Ace Insurance Co. announced in July that it would provide coverage for claims against grading mishaps as well as bullying, corporal punishment and sexual harassment.

In July, nine children and two senior citizens in Akashi, Hyogo Prefecture, were crushed to death on an overcrowded pedestrian overpass after a fireworks display. Less than a week later, a new policy made headlines by covering payments made by organizers of such events if spectators are killed or injured.

While some might call it opportunistic, the industry, suffering escalating competition and stagnant sales, cannot afford to let any disaster slip by without emphasizing the need for coverage.

“It’s speed that counts,” said Ichiro Okada, a public relations officer at Yasuda Fire & Marine Insurance Co., which proposed the fireworks insurance policy.

Under the policy, municipal governments hosting fireworks displays with an expected turnout of 50,000 spectators can receive coverage of 1 million yen for a premium of 150,000 yen.

After the policy was launched in July, the insurer received more than 150 calls — mostly from local governments — asking for more information.

“A tragedy increases social awareness of a problem, and sometimes it helps to ride on the wave,” Okada said.

Of course there are always companies that refrain from joining in.

After a bout of food poisoning caused by Snow Brand Milk Products Co. in the summer last year, four different insurers announced a policy that covered food manufacturers against product recalls. Although Mitsui Marine & Fire Insurance Co. had a policy ready to launch, it decided against following suit, due to concerns that advertising it would give food producers the impression that it is acceptable to be lax about food safety.

Rapid-response tactics do not necessarily lead to higher premium revenues, a spokesman said.

“It’s a way to grab media attention,” said Itsuko Ogawa, spokesman for Mitsui Marine. “Sometimes, it’s just a matter of rearranging and repackaging what you have and putting on a new label.

While the company often gets a lot of requests for information, the new policies rarely translate into an immediate rise in premiums, she said.

For example, Mitsui Marine’s policy covering the cost of home appliance disposal drew a lot of attention when the Home Appliances Recycling Law went into effect in April, but it has yet to attract a single customer, she said.

Likewise, Tokio Marine made headlines in January with its policy covering the cost of installing security systems and hiring security personnel to prove stalking claims.

Despite “a large volume of calls,” the insurer is now looking into ways to market the product at schools and companies, possibly as a part of a group insurance policy.

But that doesn’t slow the pace of product development. That’s because companies hope some of these newsworthy policies will survive after they are no longer news.

Like Yasuda Fire’s policies developed in 1998 for claims against food poisoning by the 0-157 E-coli bacteria, some become special options to more comprehensive policies.

Insurers continue to come up with new, unconventional policies so they can show customers they have a full lineup, said Goichi Arai, manager of the business operation department at Marine & Fire Insurance Association of Japan.

The more products you have, the theory goes, the more choices there are for customers to design their own tailor-made policy.

With premium revenues for the entire industry stagnant, it is a race insurers are struggling to win.

After three consecutive years of decline, revenue premiums managed to rise a slight 0.6 percent to 6.9 trillion yen in fiscal 2000.

And the business climate is becoming increasingly tough as the liberalization of premium rates, deregulation and more foreign entrants create an environment of fierce price competition.

If competition increases faster than alternative sources of revenue can be found, companies will begin to log losses, said Hideyuki Ito, an analyst at Moody’s Japan’s rating group.

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