Nonlife insurers agreed Thursday to use industry-pooled funds to help failed Taisei Fire & Marine Insurance Co. make payouts, according to Hiroyuki Uemura, chairman of the Marine & Fire Insurance Association of Japan Inc.
Taisei Fire failed after incurring massive losses, estimated at between 70 billion yen and 90 billion yen, related to the Sept. 11 terrorist attacks in the U.S.
The use of the pooled funds, collected through the Nonlife Insurance Policy Holder's Protection Corp., represents the latest blow to the industry from the attacks.
Sompo Japan Insurance Inc., which will take over Taisei Fire's policies, has yet to specify how much of the funds it needs, Uemura said. Taisei administrators have said they expect to request between 8 billion yen and 9 billion yen.
The insurance fund dwindled to less than 14 billion yen as of the end of March, compared to 40 billion yen two years earlier. Ninety percent of claim payments for individual policies are protected by the association.
Funds will be transferred as early as September to Sompo Japan, which will be established in July through a merger between Yasuda Fire & Marine Insurance Co. and Nissan Fire & Marine Insurance Co.