Japan's Financial Services Agency plans to postpone full liberalization of insurance policy sales at banks by eight months, until December 2007, according to sources cited Friday in a report by The Asahi Shimbun newspaper.
The change is primarily a concession to nonlife insurance companies, which opposed the measure on the basis of a similar delay in adopting partial deregulation. The agency, which had initially planned to end the ban in April 2007, is still consulting insurance representatives before making a final decision.
The insurance industry has called on the agency to ensure there is enough time to verify the effectiveness of measures to prevent unfair sales practices by banks after the planned partial deregulation is carried out.
In the latest phase of liberalization, the agency had planned to let banks start selling some savings-type products, such as single-premium, whole-life policies and personal accident insurance, in April. However, the partial deregulation is expected to be delayed until December because of opposition by the nonlife insurance sector, which is concerned about the impact on its agent networks.
The insurance industry now argues that the eight-month delay in partial liberalization leaves too little time to verify measures for preventing banks from engaging in unfair sales practices - if policy sales by banks were fully liberalized in April 2007.
