Six major property and casualty insurance firms failed to pay a total of 1.22 billion yen in legitimate claims in 4,365 cases involving medical and other “third-sector” insurance policies between July 2001 and June 2006, the Financial Services Agency said Tuesday.
Property and casualty insurers are also known as nonlife insurers. Third-sector products include medical, personal accident and nursing care insurance.
Mitsui Sumitomo Insurance Co. reported 1,140 instances of nonpayment involving third-sector products during the five-year period.
Sompo Japan Insurance Inc., reported 975 cases, followed by Nipponkoa Insurance Co., with 833, Tokio Marine & Nichido Fire Insurance Co. with 805, Aioi Insurance Co. with 470 and Nissay Dowa General Insurance Co. with 142.
Four companies had more than 200 million yen in unpaid claims. Mitsui Sumitomo had 284 million yen, followed by Sompo Japan and Tokio Marine at 270 million yen each, and 215 million yen at Nipponkoa.
Aioi failed to pay insurance claims worth 146 million yen, and Nissay Dowa rejected 37.74 yen in claims.
In-house investigations conducted at the FSA’s request uncovered the nonpayment at the six insurers.
“We failed to create a customer-oriented system,” Tokio Marine President Kunio Ishihara admitted at a news conference. “We are very sorry.”
Nonpayment of third-sector insurance money was first found at Mitsui Sumitomo, which was ordered by the FSA to halt sales of medical insurance products for an indefinite period starting July 10.
The financial industry watchdog ordered all 48 nonlife insurance companies nationwide to conduct internal investigations of nonpayment of third-sector insurance money by the end of October.
With all the insurers believed to have reported their findings, the FSA is expected to issue administrative penalties by the end of the year.
Earlier this year, 26 nonlife insurers, including the six major firms, reported 318,000 cases of nonpayment, valued at 6 billion yen, involving car insurance and other property and casualty products.
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