The Japan Fair Trade Commission (JFTC) conducted raids on four major Japanese insurance companies and two of their agents, following suspicions of cartel activities in business insurance policies. The companies involved include: Tokio Marine & Nichido Fire Insurance Co., Sompo Japan Insurance Inc., Mitsui Sumitomo Insurance Co., and Aioi Nissay Dowa Insurance Co.
The firms are under scrutiny for allegedly imposing trade constraints that are prohibited under Japan’s antimonopoly law. Sources familiar with the case indicated that the JFTC’s actions were initiated following an investigation that started in August, revealing evidence of widespread cartel formation among these insurers.
As per a report from The Mainichi, the raid marks the first instance where major general insurance firms have been targeted under the antimonopoly law for cartel allegations. The JFTC is reportedly considering imposing a surcharge on the companies involved.
According to the sources, the insurers are accused of coordinating the premiums of policies for several organizations, including Cosmo Energy Holdings Co., Cosmo Oil Co., Jera Co., Keisei Electric Railway Co., the Japan Organization for Metals and Energy Security, and the Tokyo Metropolitan Government. Most of these companies, except Aioi Nissay Dowa Insurance, are also suspected of manipulating premiums for Sharp Corp.
The investigation found that the policies for the Tokyo Metropolitan Government, which were single insurance policies underwritten by a single company, had specific firms assigned to each type of coverage. These assignments included auto insurance for public vehicle accidents and road liability insurance for accidents due to defects in metropolitan roads, with fixed pricing arrangements.
Prior to the JFTC probe, the Financial Services Agency (FSA) ordered the four companies to submit reports regarding cartel allegations in May, based on the Insurance Business Act. The fair trade commission began its investigations in August over policies sold to Tokyu Group and Sendai International Airport Co., following information provided by the FSA.
The JFTC reported that it intends to continue its investigation into these matters.
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