The posts ministry on Friday approved a new postal insurance product being opposed by other countries' trade watchdogs and domestic private-sector insurers.

The decision will likely spark heated exchanges at a Japan-U.S. working-level meeting on insurance policy to be held Monday in Tokyo.

Japan Post -- a public corporation created in April to take over the Postal Services Agency's mail delivery, postal savings and "kampo" life-insurance services -- plans to launch the new product Jan. 1.

The so-called fixed-term whole-life policy pays maximum death benefits in the event of a policyholder's death while working -- but much less after retirement age, thereby helping to reduce the burden of premium payments.

The product has been a mainstay of private-sector life insurers, while postal insurance services have focused on savings-oriented life insurance products.

Earlier Friday, posts minister Taro Aso said Japan Post must widen the range of its products in order to bolster its financial profile before being privatized.

But Financial Services Minister Heizo Takenaka on Friday appeared to side with the critics of the new insurance product.

"From the viewpoint of healthy development of the insurance business . . . there would be concern if Japan Post, with government guarantees, were to sell a new product that competes with that of the private sector," Takenaka told reporters.

On Thursday in Washington, the U.S. Chamber of Commerce issued a statement urging Tokyo not to approve the new product of the "kampo" postal insurance system.

"The U.S. chamber joins with other national and international organizations in urging the government of Japan to reject kampo's new product and to ensure that no additional products will be introduced that compete with the private sector until such time as a level competitive environment is achieved," U.S. Chamber of Commerce President Thomas Donohue said in the statement.

Japan Post overseen by the Postal Services Agency, has applied for government approval to sell the fixed-term, whole-life insurance policy.