Stable stock prices have eased concerns about potential failure at the nation's nine largest life insurance companies, but they continue to struggle against shrinking business volume, according to interim reports announced as of Thursday.

In a war against attrition, aggregate volume of policies in force slipped for the sixth consecutive year, dropping 5 percent year-on-year to 1.066 quadrillion yen.

The result was that premium income fell at all but two insurers. Even at those two, gains were tiny: Industry giant Nippon Life Insurance Co. saw growth of 1.7 percent year-on-year to 2.7 trillion yen and midsize Mitsui Mutual Life Insurance Co. booked a 1.6 percent gain to 450.1 billion yen.

Companies simply found it difficult to retain customers. The value of new business could not keep up with the speed of policy terminations at all but Fukoku Life Insurance Co.

Insurers blamed the government's decision in July to allow life insurers in a pinch to cut promised rates of return to customers.

"It's an extremely severe climate for sales," said Mitsuhiro Ishibashi, executive vice president of Nippon Life. To keep policyholder flight at bay, the industry giant will have sales representatives visit customers often, he said, "to better respond to their needs."

Nippon Life's new business volume fell 17.1 percent to 10.3 trillion yen, while the volume of policy terminations grew 18.2 percent to 13.9 trillion yen.

In a nation where 10 years ago it was not uncommon to find customers with multiple life insurance policies, older customers are slashing monthly premium payments and younger people refuse to sign up, or opt to join large global insurance groups.

Fortunately, stable stock prices are buying time for the insurers.

Unrealized gains on domestic stocks ballooned six-fold at all nine life insurance companies, growing from 452.7 billion yen in March to 3.4 trillion yen.

With the extra boost to capital, solvency margin ratios -- a measure of an insurer's financial soundness -- grew at all nine.

Tomoo Yamada, senior managing director of Asahi Mutual Life Insurance Co., heaved a sigh of relief that policyholder flight had eased, dropping 14 percent from last year to 4.8 trillion yen.

"Policy terminations are still high, but the very violent wave we saw last year is behind us," Yamada said.

Asahi was able to book a 615 percent solvency margin ratio from 414 percent in March.

With the industry facing intensive price competition, many executives have pegged their hopes on nursing care and health insurance policies.

"We will continue to value life insurance policies, but we plan to focus more effort into nursing care insurance policies for seniors," said Katsutoshi Saito, senior managing director of Dai-ichi Mutual Life Insurance Co.

Meiji Insurance Co. Managing Director Tohru Matsuura was the only one to go against the consensus.

"I don't believe the life insurance market is saturated," he said. "Nursing and cancer insurance seem all the fashion, but there is certainly more we can do to help customers prepare against the worst-case scenario."

The race for new income is a race against time. Customers are shying away at a time when insurers continue to be squeezed by what is known as negative spread.

Given ultra-low long term interest rates, insurers have not been able to earn enough investment returns to keep up with promised insurance payouts to customers.