There were 3,649 cases of suicide in fiscal 2005 that resulted in the person’s consumer loan debts being paid off by their life insurance companies, the Financial Services Agency said Wednesday.
Five major consumer loan companies in Japan — Acom Co., Aiful Corp., Takefuji Corp., Promise Co. and Sanyo Shinpan Finance Co. — received insurance payouts in a total of 39,880 cases that resulted from borrowers’ deaths during the year to March 31. In 3,649 of the cases, 9.1 percent of the total, the borrowers committed suicide, the officials said.
Large consumer loan companies typically buy group life insurance policies and name themselves as the beneficiaries when signing contracts with borrowers so they can recover their money if the clients die.
The FSA has been investigating the five firms because they are suspected of taking out policies without telling the clients. The FSA is now telling consumer loan companies they must obtain the client’s consent before taking out the insurance, the officials said.
The FSA’s investigation into the procedures at the five loan firms was sparked by a question from House of Representatives member Akira Nagatsuma of the Democratic Party of Japan.
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