Mitsui Sumitomo Insurance Group Holdings Inc. and two other nonlife insurers hope to double their combined overseas sales and will try to avoid layoffs after they integrate in April 2010, top executives of the three companies say.
Mitsui Sumitomo Insurance Group President Toshiaki Egashira said that by merging their operations, his firm, Aioi Insurance Co. and Nissay Dowa General Insurance Co. will have overseas bases in 38 countries.
“We will aim to earn ¥500 billion in net premium revenues from overseas operations,” Egashira said.
The firms announced the plan in January. The three-way integration will create Japan’s largest and the world’s fifth-largest nonlife insurance group.
Under the agreement, Mitsui Sumitomo, the second-largest domestic nonlife insurer, will create a new holding company that will bring under its wing the fourth-ranked Aioi and sixth-ranked Nissay Dowa, but not until after those two first merge into a single entity.
Egashira expressed hopes of close cooperation with Toyota Motor Corp., which is expected to become the top stakeholder in the new holding company. He said the integrated companies will actively seek to explore markets centering on Asia and target not just Japanese corporate clients but also tap markets for insurance policies for individuals.
Nissay Dowa President Ichiro Tateyama said he does not anticipate job cuts after the integration.
“We will not carry out restructuring,” he said. “There may be an excess of personnel, but we will assign them to be in charge of quality enhancement of operations, damage surveys and sales.”
Tateyama said the company has not been able to tap sufficiently into the clients of Nippon Life Insurance Co. in selling nonlife products. Nippon Life is Nissay Dowa’s top shareholder. Currently, Nissay Dowa has policy contracts with only about 8 percent of Nippon Life’s individual clients.
While the merger will dilute capital ties with Japan’s top life insurer, Tateyama said he hopes to maintain a close relationship by transferring the additional personnel to support sales at Nippon Life.
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