The deregulation of Japan's insurance sector last year has set domestic and foreign-affiliated companies squarely against each other in the cancer and medical insurance battlefield.

The competition has been focused on the securing of marketing channels for these so-called third-sector insurance products, the demand for which is expected to grow along with Japan's graying society.

Deregulation has provided a ray of hope for some domestic life insurers that have been hit by a wave of policy cancellations amid a problematic business climate.